The news: Capital One’s net revenues increased 25% QoQ to $12.5 billion—one of the many dramatic changes after its merger with Discover.

• Credit card period-end loans skyrocketed 72% QoQ to $269.7 billion. Without Discover, that stat was up 4% YoY.
• Credit card purchase volume surged 22% on the year. Excluding Discover, volume rose 6% YoY.

State of the consumer: Capital One’s credit card metrics reflected improved consumer health.

• The 30-day delinquency rate was 3.56%, down on the quarter (4.27%) and the year (4.17%).
• Net charge-off rates were 5.2%, down on the quarter (6.14%) and the year (6%).

What’s happening: Capital One just cemented itself as the largest credit card company in the US by outstanding loan value post-Discover merger. Having inherited Discover’s portfolio and its network, Capital One is ready to use its new infrastructure and size to make its offerings more competitive.

CEO Richard Fairbanks stated the issuer’s new reality plainly: “We are one of two banks in the world with their own network, and we are moving to capitalize on this rare and valuable opportunity.”

• Fairbanks hopes to expand the international reach of the Discovery network and then develop a global brand to onboard more big spenders—like VentureX cardholders.
• Capital One started reissuing some debit cards onto the Discover network in June.
• The bank also sees Discover’s student credit and secured card segments as key areas to dial in investment.

Capital One anticipates onboarding all debit customers onto the Discover network by early 2026.

Our take: The scale of Capital One’s merger is eyewatering. As the issuer looking to maximize its yields, it can both offer more attractive credit and debit products within a regulatory environment that is friendly to ambitious growth. 

On the network side, Mastercard risks being the biggest loser of this deal as Capital One onboards more of its portfolio onto Discover and off its platform. But that onboarding will be slow going—Capital One needs to invest in expanding Discover’s international acceptance before it can start moving premier cards like the Venture X onto the network.

This content is part of EMARKETER’s subscription Briefings, where we pair daily updates with data and analysis from forecasts and research reports. Our Briefings prepare you to start your day informed, to provide critical insights in an important meeting, and to understand the context of what’s happening in your industry. Non-clients can click here to get a demo of our full platform and coverage.