Earnings

Investors Eyeing Card Volume, B2B Gains For Visa’s Earnings Report

Card Volume, B2B Gains Eyed for Visa Earnings

Investors and analysts will have their eyes on Visa’s growth across cross-border transactions and card spend in its fiscal first quarter, a double-digit trajectory seen in its latest earnings report last October.

The headline numbers show that expectations headed into the Wednesday report have the company posting revenue of $5.4 billion, which would be up 12 percent year on year, and adjusted earnings of $1.21. Analysts expect international transactions to contribute about $1.9 billion, as estimated by sites such as AlphaStreet.

Drilling down a bit into what lies beneath those numbers, payments volume in the latest reading stood at $2.1 trillion, with 11 percent growth in the quarter that ended in September. Credit transactions were up 10 percent, and debit transactions were up 12 percent.

On a global stage, it will be worth watching the impact of the economic slowdown that is hitting several regions, especially China, where in the past growth in the United States has offset a slump in dual-branded card volume. The company said last quarter that major aspects of the integration of the Visa Europe deal was complete, and so analysts will likely want to hear further anecdotes over traction in the region.

CEO Alfred Kelly said in commentary during the post-release earnings call last quarter that new contracts with clients have been boosting payments volume overall.

Management has also pointed to growth in digital payments, which has been in the triple digits on a percentage basis. Visa Direct transactions are being completed in more than 150 countries.

Kelly also noted in October that “we are quickly increasing the number of issuers moving to real-time payments,” with Spain and Ireland added in the quarter to over 70 countries that are fast funds-enabled. Contactless payments also have been growing at double-digit rates. In one recent push into contactless, Chase said late last year that it would roll out tap-and-pay functionality across its Visa card portfolio. Tap-and-pay also came to Pentagon Federal Credit Union – the second-largest federal credit union in the country – through Visa credit and debit cards earlier this month.

Kelly also has stated that B2B payments remain a top strategic focus, and volume stood at $950 billion, at 11 percent of volume in the last fiscal year. In recent news related to cross-border and B2B payments, Visa bid roughly $250 million in December to buy U.K.-based payments firm Earthport, which facilitates cross-border payments for banks and enterprises. Mastercard earlier this month trumped that bid, with an offer that was roughly 10 percent higher than Visa’s, and was ultimately embraced by Earthport.

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