Visa tops expectations, weighs up Facebook’s cryptocurrency
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Visa tops expectations, weighs up Facebook’s cryptocurrency

Visa had a strong second quarter, as it revealed this month. The company topped consensus estimates on top- and bottom-lines, thanks to higher card spending and, according to CEO Al Kelly, “getting its act together” in relation to “FinTechs”. These partnerships have been a source of success for Visa over recent quarters, but that was not always the case. As Kelly says: “I’d be the first to admit, I think we were a little bit slow [in regards to FinTechs] out of the chute a year and-a-half ago.”

Visa’s share price has appreciated by 40% so far this year

Visa July 30

Source: Yahoo Finance

For its fiscal third quarter, Visa said it collected revenues of $5.8 billion. That compared favourably with analysts’ expectations for revenues of $5.7 billion. The company managed a similarly marginal beat over consensus estimates when it came to earnings, reporting $1.37 per share, rather than the $1.32 per share that analysts had hoped for.

Putting a positive gloss on the quarter, Kelly told listeners on an earnings call: “Visa had an excellent third quarter in terms of accelerating business growth while advancing our strategy through acquisitions, investments and partnerships.”

One of those partnerships, in particular, was worthy of comment. Discussing Facebook’s proposed Libra cryptocurrency (which Visa has expressed an interest in), Kelly said that “the devil is in the details,” adding: “There’s just a tremendous amount to be finalized. But obviously, given that we’ve expressed interest we actually believe we could be additive and helpful in the association.”

Visa said that, adjusted for currency fluctuations, payments volume rose by 9% and cross-border transactions increased by 7%.

Disclosure

Dominion holds Visa in its Global Trends Ecommerce Fund.


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