Visa Reports Higher-Than-Expected Quarterly Profit Driven by Increased U.S. Credit Card Spending

Visa Inc. reported a higher-than-expected quarterly profit for its fiscal second quarter of 2024, driven by increased credit card spending in the United States. The company's GAAP net income rose to $4.7 billion, or $2.29 per share, from $3.65 billion, or $1.70 per share, a year earlier. Analysts had expected a profit of $1.81 per share, according to Refinitiv data.

Visa's total processed transactions increased 12% to 48.6 billion, while cross-border volume, which tracks international travel and e-commerce, grew 23% on a constant-dollar basis. The company's results surpassed US consumer spending in the U.S., particularly on credit cards, as the economy continues to recover from the COVID-19 pandemic.

Visa's payment volume climbed 8% in the second quarter, with cross-border volume excluding intra-Europe, a gauge of international travel demand, jumping 16%. Processed transactions rose 11% in the period. The company expects net revenue growth in the 'low double-digit' range for the current quarter ending June 30 and reaffirmed its 2024 revenue and earnings forecasts.

Why this matters: Visa's strong performance indicates a robust recovery in consumer spending and international travel, signaling a positive outlook for the global economy. The company's ability to navigate market dynamics and maintain growth despite challenges underscores its resilience and market leadership in the digital payments industry.

The upbeat earnings come after Visa and rival Mastercard reached a $30 billion settlement to limit credit and debit card fees for merchants. Visa's second-quarter adjusted profit per share of $2.51 beat estimates, and its net revenue of $8.8 billion also topped expectations. "Our second quarter results demonstrated robust trends in consumer spending, with notable growth in travel-related spending and e-commerce," said Alfred F. Kelly, Jr., Visa's Chairman and Chief Executive Officer.

Key Takeaways

• Visa reported higher-than-expected Q2 2024 profit of $2.29 per share.
• Visa's total processed transactions increased 12% to 48.6 billion.
• Cross-border volume grew 23% on a constant-dollar basis.
• Visa expects low double-digit revenue growth for Q3 2024.
• Visa's strong performance signals robust recovery in consumer spending.