VISA Inc on Thursday reported better-than-expected quarterly earnings and said it expected full-year profit at the high end of its forecast, as it benefited from the purchase of Visa Europe and big credit-card portfolio won back home.
Shares of Visa, the world’s largest payments network operator, were up 2.5 per cent at $US93.45 ($F195) in trading after the bell, after it also announced a $US5 billion ($F20b) share buyback program.
The company said total payments volume jumped 37.2 per cent to $US1.73 trillion ($F3.6t) in the second quarter ended March 31, on a constant dollar basis.
San Francisco-based Visa, like rival MasterCard generates revenue by facilitating credit- and debit-card transactions.
The growth in payments volume was helped by the addition to Visa’s results of Visa Europe, a former subsidiary Visa bought in June last year in a deal worth as much as $US23b ($F48b).
Visa Europe made up nearly a fifth of total payments volume.
Payments volume in the US, Visa’s biggest market, increased 11.7 per cent on a constant dollar basis, helped both by major portfolio contracts as well as a stronger economy.
Warehouse club retailer Costco and USAA, one of the largest US issuers of credit and debit cards, switched their card portfolios to Visa last year, in a competitive environment where large portfolios are hotly sought-after by payment networks.
A healthier US economy, which has seen strong jobs growth and rising incomes in the first quarter of 2017, bodes well for consumer spending — a key economic indicator for payments processors like Visa.
