On July 25, Visa (V) posted its third fiscal quarter results. The company posted an EPS of $1.20, which exceeds Wall Street analysts’ expectations by $0.11. According to the company’s management, the third fiscal quarter results were impacted by the favorable economic environment globally and business fundamentals.
Visa’s payments volume rose 11% YoY, on a constant dollar basis, in the third fiscal quarter. During the same period, the company’s total processed transactions rose 12% YoY. In the March quarter, Visa’s payment volumes were $1.9 trillion, while Mastercard’s (MA) gross dollar volumes were $1.4 trillion. To calculate Visa’s service revenues, the previous quarter’s payments volumes are taken into consideration.
In the third fiscal quarter, Visa generated revenues of $5.24 billion, which beat the expectations by $150 million. Capital One Financial (COF), a consumer finance company (IYF), posted total net revenues of $7.2 billion in the second quarter, while American Express’s (AXP) total revenues were $10 billion.
Of Visa’s total payments volumes, which amounted to $2.1 trillion in the third fiscal quarter, its debit programs contributed $919 billion and credit contributed $1.2 trillion.
Visa saw $928 billion in payments volume from the US in the third fiscal quarter, which implies 10.5% growth YoY on a constant dollar basis mainly due to lower unemployment levels. On a sequential basis, the growth represents a marginal rise. In the second quarter, the payments volume grew 10.1% YoY. Commerical and debt transactions contributed to the sequential increase.
Visa expects strong growth opportunities from the European region. The European economy depends on cash for the transactions.