uploads///EV to Rev

Visa’s Operating Revenue Rose Year-over-Year

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Feb. 12 2018, Published 10:00 a.m. ET

Net operating revenue

In fiscal 1Q18, Visa (V) generated net operating revenue of $4.9 billion compared to $4.5 billion a year earlier, representing a rise of 9%.

The company’s service revenue was $2.1 billion in fiscal 1Q18 compared to $1.9 billion a year earlier, reflecting a rise of 12% mainly due to positive momentum in nominal payment volumes. These volumes rose 10% in fiscal 1Q18 on a YoY (year-over-year) basis.

Visa’s data processing revenue amounted to $2.1 billion in fiscal 1Q18, while a year ago, this processing revenue came to $1.9 billion. The difference represents a rise of 13%. This rise was seen primarily as the result of a 12% rise in the company’s processed transactions.

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International transaction revenue

Visa generated other revenue of $229 million in fiscal 1Q18 compared to $203 million a year ago, implying a rise of 13%. The company garnered international transaction revenue of $1.7 billion in fiscal 1Q18 compared to $1.5 billion a year ago, reflecting a rise of 12%. This rise was seen mainly as a result of a 14% rise in nominal cross-border volumes.

Visa’s operating revenue is affected by the fluctuations in the US dollar. Its international transaction revenue, services revenue, and client incentives are all metrics that are majorly affected by fluctuations in the dollar.

Visa’s enterprise value-to-revenue ratio stands at 14.61x on a trailing-12-month basis. Peers (XLF) Fiserv (FISV), Green Dot (GDOT), and Total System Services (TSS) have enterprise value-to-revenue ratios of 5.69x, 3.70x, and 3.82x, respectively, on a trailing-12-month basis.

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