U.S. credit card purchase volumes jumped 10% from the figure of $769 billion in Q2 2016 as well as Q1 2017 to reach a record high of $844 billion in Q2 2017. Visa gained the most from the continuing surge in cashless transactions, as the payment giant’s 19% y-o-y jump in the figure helped its market share increase from under 49% a year ago to almost 53% now.
The payments industry is seasonal, with purchase volumes peaking in the fourth quarter of the year due to the impact of holiday season shopping, before falling sharply in the first quarter. The figure then increases steadily over the second and third quarters. This trend is seen clearly in the table below, which captures the changes in credit card purchase volumes for these companies over the last five quarters.
Visa’s dominance in the industry is also evident from the table above, as the company continues to process more credit card payments than its three rivals combined. While American Express’s card purchase volumes fell below the peak level in Q2 2016 due to the company’s sale of its Costco and JetBlue co-branded card portfolio, MasterCard and Discover have not been able to match Visa’s substantially faster growth rate.
You can see how changes to Discover’s card purchase volume impacts our estimate for the company’s share price by modifying the chart below.
View Interactive Institutional Research (Powered by Trefis):
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
