Statement of Comprehensive Income

Comprehensive income is the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.

Mastercard Inc., consolidated statement of comprehensive income

US$ in millions

12 months ended:	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018
Net income	9,930)	8,687)	6,411)	8,118)	5,859)
Foreign currency translation adjustments, net of income tax effect	(675)	(387)	286)	23)	(279)
Translation adjustments on net investment hedges, net of income tax effect	275)	209)	(137)	28)	75)
Cash flow hedges, net of income tax effect	1)	5)	(147)	11)	—)
Reclassification adjustment for cash flow hedges, net of income tax effect	(8)	4)	3)	—)	—)
Cash flow hedges, net of income tax effect	(7)	9)	(144)	11)	—)
Defined benefit pension and other postretirement plans, net of income tax effect	(31)	43)	(10)	(18)	(13)
Reclassification adjustment for defined benefit pension and other postretirement plans, net of income tax effect	(1)	(2)	(1)	(1)	(2)
Defined benefit pension and other postretirement plans, net of income tax effect	(32)	41)	(11)	(19)	(15)
Investment securities available-for-sale, net of income tax effect	(5)	(1)	(1)	2)	(2)
Other comprehensive income (loss), net of income tax effect	(444)	(129)	(7)	45)	(221)
Comprehensive income	9,486)	8,558)	6,404)	8,163)	5,638)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

Net income exhibited a consistent overall upward trajectory from 2018 to 2022, increasing from US$ 5,859 million to US$ 9,930 million. A temporary contraction was observed in 2020, during which net income decreased to US$ 6,411 million, followed by a strong recovery in 2021 and further expansion in 2022.

Comprehensive income generally tracked the movements of net income, although the gap between the two metrics widened toward the end of the period. While comprehensive income grew from US$ 5,638 million in 2018 to US$ 9,486 million in 2022, the growth rate was attenuated by a significant decline in other comprehensive income during the final year.

Foreign Currency Translation Adjustments: Foreign currency translation represented the primary driver of volatility within other comprehensive income. After peaking at a gain of US$ 286 million in 2020, the figures shifted to a significant downward trend, resulting in a loss of US$ 675 million by December 31, 2022. This indicates an increasing negative impact from exchange rate fluctuations on the consolidated financial position.
Investment and Cash Flow Hedges: Translation adjustments on net investment hedges served as a partial offset to currency losses, showing a general increase from US$ 75 million in 2018 to US$ 275 million in 2022. In contrast, cash flow hedges remained relatively immaterial, with values fluctuating minimally and contributing negligible impact to the overall comprehensive income.
Pension and Postretirement Plan Adjustments: Adjustments related to defined benefit pension and other postretirement plans remained marginal throughout the period. These values fluctuated between modest gains and losses, peaking at a gain of US$ 41 million in 2021 before returning to a loss of US$ 32 million in 2022, suggesting these items do not fundamentally alter the comprehensive income profile.
Other Comprehensive Income (OCI) Trend: The aggregate other comprehensive income transitioned from a loss of US$ 221 million in 2018 to a significant loss of US$ 444 million in 2022. The most acute deterioration occurred between 2020 and 2022, where OCI moved from a near-neutral position of US$ -7 million to a substantial deficit, primarily driven by the aforementioned currency translation losses.

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Mastercard Inc. (NYSE:MA)

Statement of Comprehensive Income