Key Takeaways
- The payment processor reported adjusted earnings per share of $3.31, surpassing the $3.10 forecast, while revenue reached $11.2 billion compared to expectations of $10.75 billion
- Top-line figures expanded 17% compared to the same period last year — marking the strongest growth rate in two years
- Payment volumes increased 9%, international transactions climbed 12%, and total processed transactions expanded 9%
- The company unveiled a fresh $20 billion stock repurchase authorization and set a quarterly dividend at $0.670 per share
- Shares climbed more than 5% during extended trading hours following a regular session close of $309.10, down 0.1%
The payment technology giant exceeded Wall Street projections for both profits and sales in its fiscal second quarter. The company released results on Tuesday evening, April 28.
Adjusted earnings per share registered at $3.31, climbing from $2.76 in the year-ago period and surpassing the analyst projection of $3.10. Total revenue touched $11.2 billion, representing a 17% year-over-year expansion and the most robust growth pace since 2022. Wall Street analysts had anticipated $10.75 billion.
GAAP-based net income totaled $6.0 billion, translating to $3.14 per share — a 36% increase from the comparable quarter last year. The reporting period incorporated a $311 million litigation reserve related to the interchange multidistrict litigation matter.
Total payment volumes advanced 9% when measured on a constant-currency basis. International volume excluding intra-Europe transactions grew 12%, while the number of processed transactions reached 66.1 billion, representing a 9% year-over-year gain.
Chief Executive Ryan McInerney highlighted that consumer spending patterns remained healthy throughout the period. He emphasized advancements in the company’s “hyperscaler of payments” initiative, which now includes emerging agentic and stablecoin functionalities being developed by Visa.
Service-related revenue advanced 13% to $5.0 billion. Data processing revenue jumped 18% to $5.5 billion. Revenue from international transactions expanded 10% to $3.6 billion. Client incentives reached $4.2 billion, up 14%.
Capital Allocation Strategy
The company bought back approximately 25 million shares for $7.9 billion throughout the quarter. Directors authorized a new multi-year $20 billion share repurchase program and approved a quarterly cash dividend of $0.670 per share.
Shares jumped more than 5% during Tuesday’s after-hours session on the back of these results, following a regular trading close at $309.10. The stock remains approximately 12% lower year-to-date.
Competitor Mastercard advanced 2.8% in extended trading, while American Express shares gained 1%. Visa traded around $325 during Wednesday’s premarket session.
Darrin Peller, an analyst at Wolfe Research, indicated his firm maintains a “constructive” view following the quarterly report, expressing confidence in sustainable growth momentum and potential for modest estimate increases. He observed that spending patterns appear solid, with the exception of travel-related softness connected to the Iran conflict.
Potential Headwinds Emerge
Several challenges face the payment processing sector this year, affecting Visa, Mastercard, and American Express.
Elevated oil prices stemming from U.S. military action in Iran have contributed to sustained higher interest rates. President Trump floated a proposal in January to limit credit card interest rates to 10% — approximately half the prevailing average of 19.57%. Digital stablecoins present an evolving competitive threat over time, providing merchants with reduced transaction fees and accelerated settlement times.
Tom Porcelli, chief economist at Wells Fargo, noted that daily card expenditure has declined notably in recent weeks, with year-over-year growth approaching zero. He linked this trend to “spending fatigue amid the ongoing Iran conflict.”
This softness is anticipated to appear in the Census Bureau’s retail sales figures for April.
