Mastercard Incorporated (NYSE:MA) Q2 2023 Earnings Call Transcript

And then specifically in my comments, I talked about that the strength in Cyber & Intelligence as well as in some of our Data & Services capabilities was offset by other solutions. And it’s really all about what the growth rate trends are for Cyber & Intelligence and Data & Services relative to growth rates and things like real-time ACH, especially on the infrastructure level. So when we talk about other solutions, think about it in the context of things like real-time ACH, which tend to grow at a lower pace there. So historically, what we had spoken about was just services. Now we are talking about value-added services and solutions. When we think about services in the historical context, in Q2, that services growth rate was more like 18%.

So just for a reference point beyond that.

Operator: We’ll move next to Timothy Chiodo at Credit Suisse.

Timothy Chiodo: I want to dig in a little bit on another business that is important to your — both your volume and your revenue growth algorithm over the medium term, which will be Mastercard Send. You touched a little bit on some of the cross-border use cases. I believe many of the initial use cases were much more domestic, but it’s evolving over time. Maybe you could just dig in a little bit more to some of the cross-border use cases that are really gaining traction.

Michael Miebach: Right. So Timothy, let me start off with that. So our Send business domestic and cross-border together, that’s how we look at it. There’s a big chunk in there, which is cross-border disbursement remittances, as you rightly said. The way that we go after that is by adding new geographies. I gave you 3 markets that we’ve added this year, Chile Bahrain and Slovakia. So there is tremendous reach — unparalleled reach in what we have in our cross-border proposition, 100 countries around the world. Then there’s new ways to go after it, and that is the use cases. So earlier when I was talking about gaming payout, some of that is domestic, some of that is international. The whole workers’ remittances piece, Al Fardan in Qatar, those are important corridors.

We very specifically go after these corridors, Middle East into South Asia and so forth. So it’s pretty methodological. But there’s another way that — which I haven’t talked about on how to accelerate this business, and this is how we make it easier for customers to onboard with us. So cross-border service express, which is kind of prepackaged solution around cross-border payments is another way for us to accelerate this business. So new geographies, new use cases, corridor-specific, great methodology. I think we have the right kind of assets here across our HomeSend integration, across our Transfast acquisition, the Mastercard proprietary system and our card reach. So all in, this is growing at a very healthy pace, and we like that business a lot.

We are experts in cross-border, as you know, on the card side, and we’re building that out here — over here in cross-remittances and disbursements.

Operator: We’ll go to our next question from Rayna Kumar at UBS.

Rayna Kumar: Both of you in the past have discussed how B2B remains a large opportunity for Mastercard. Can you talk about what trends you’re seeing in B2B payments in this macro environment, how you’re progressing against capturing the TAM and if you’re seeing any slowdown in corporate spending as companies potentially tighten their budgets?

Michael Miebach: Thank you, Rayna. I’m noticing a lot of questions coming from me means that there isn’t a lot of questions in the numbers, which is fantastic. And I love to talk about B2B. Let me take the lens, Rayna, that’s a little bit broader here on commercial overall. So I feel like I’m repeating myself here, but we’re choosing priorities because they are growing at a healthy clip, so is the story for commercial growing at a healthy clip. So this is — we’re seeing a quarter-over-quarter, year on — quarter 2 year-over-year growth above the consumer side. There’s particular strength in our international markets business. And we’ve sustained elevated levels of growth when we compare this back to 2019, all the noise of COVID out of it.