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Visa Processed Transactions in Line with Expectations

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Aug. 18 2020, Updated 5:26 a.m. ET

Processed transactions

Visa (V) reported total processed transactions of 27.9 billion in 4Q15 compared to 25 billion in 4Q14. Total transactions represent the payments and cash transactions reported by the company’s clients on their operating certificates. Total transactions grew by 11% on a YoY (year-over-year) basis. The composition of the spending changed marginally. Of the total transactions, 38% were made through credit. The remaining transactions were made through debit.

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Of the total transactions, Visa processed total transactions of 18.4 billion compared to 17.0 billion in 4Q14. US transactions recorded 11% growth, while international transactions growth was flat. Processed transactions include transactions involving Visa, Visa Electron, Interlink, and Plus cards processed on the company’s networks.

Russia’s impact

Visa transferred the domestic processing of payments to the new national processor National Payment Card System of Russia in April. International processed transaction growth was 13% when normalized for the transfer of domestic processing in Russia that started at the end of April.

The company expects the negative impact on process transaction growth to continue for the next two quarters. In October, the process transaction growth rate was 8%. The US growth rate was 11%, and the international growth rate remained flat. The international growth rate fell primarily due to Russia’s impact and falling commodity and crude oil prices (USO).

Visa achieved operating profit margins of 65% in the last fiscal year ended September 30, 2015. Here’s how some of Visa’s peers in the payment processing industry fared with their operating margins in the last fiscal year:

  • MasterCard (MA) – 54%
  • American Express (AXP) – 25%
  • Discover Financial (DFS) – 43.6%

Together, these companies account for 2.3% of the Technology Select Sector SPDR ETF (XLK).

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