[Overseas Stocks Spotlight] "Mastercard Accelerates Cashless Society... Mid- to Long-Term Growth Potential Up"

[Asia Economy Reporter Eunmo Koo] MasterCard (MA US) reported a decline in payment-related revenue in the second quarter of this year, but other revenue, which includes non-payment processing income, increased due to rising demand for digital payment infrastructure development. Analysts suggest that the long-term growth potential remains high as the cashless society accelerates.

MasterCard's revenue and earnings per share (EPS) for the second quarter of this year were $3.34 billion and $1.36, respectively. These figures exceeded consensus estimates by 2.5% and 21.8%, respectively, but represent decreases of 18.9% and 28.0% compared to the same period last year.

Jae-woo Kim, a researcher at Samsung Securities, explained in a report on the 1st, "Global lockdown measures due to COVID-19 led to a sharp decline in consumption, causing payment amounts and transaction volumes to drop by 13.6% and 9.3% year-over-year, respectively." He added, "Given the ongoing uncertainty regarding the scale and timing of consumption recovery due to COVID-19, MasterCard, like Visa, did not disclose its outlook for the third quarter."

It is expected that MasterCard will pursue differentiation by strengthening value-added services in the rapidly changing payment market. Other revenue, which includes non-payment processing income, reached $1.08 billion, up 12.4% from the same period last year, accounting for 21.2% of total revenue.

Researcher Kim stated, "This increase is due to the activation of e-commerce and rising demand for digital payment infrastructure even among small and medium-sized stores, which has significantly boosted demand for data analytics and solution-related services." He further explained, "Going forward, MasterCard has expressed its commitment to enhancing value-added services by focusing investments on new trends in the rapidly evolving payment market, such as open banking, real-time payments, and cybersecurity services."

Considering its structural growth potential, MasterCard is still regarded as attractive. Kim said, "As the cashless society accelerates, structural growth is being achieved, and a sharp revenue recovery is expected once consumption normalizes post-COVID-19. Additionally, efforts by MasterCard to differentiate itself are likely to improve its market share."

This content was produced with the assistance of AI translation services.