VISA slipped in late trading on Tuesday (Jul 23) after reporting quarterly revenue that just missed Wall Street estimates – a rarity for the world’s biggest payments network.
Shares of San Francisco-based Visa declined 3 per cent to US$256.85 at 5.04 pm in New York.
Net revenue for the fiscal third quarter ended Jun 30 was US$8.9 billion, Visa said on Tuesday. That was about US$60 million – or 0.6 per cent – shy of the average estimate of analysts in a Bloomberg survey. Visa last missed analysts’ revenue estimates by an even narrower margin in 2020, data compiled by Bloomberg show.
Adjusted net income for the fiscal third quarter rose 9 per cent to US$4.9 billion, or US$2.51 a share, beating Wall Street’s prediction of US$2.43.
Worldwide card spending climbed 4.9 per cent from a year earlier. In the US, where Visa gets roughly 40 per cent of its revenue, spending advanced 5.1 per cent. US retail sales, excluding motor vehicles, rose last month by the most in three months, a sign that the economy is still holding up as the Federal Reserve gets closer to cutting interest rates.
Last month, a federal judge rejected a US$30 billion settlement that Visa and rival Mastercard had reached earlier in the year with US merchants in an attempt to resolve two decades of litigation over credit-swipe fees.
US district judge Margo Brodie in Brooklyn wrote that the accord would have “disproportionately and inequitably” benefited small, local merchants over larger companies such as Walmart and Target and that Visa and Mastercard appear capable of swallowing a “substantially” costlier deal. BLOOMBERG
