October 26, 2021
(Reuters) -Visa Inc reported a rise in quarterly profit on Tuesday that beat Wall Street estimates, as the world’s largest payment processor benefited from a pickup in travel with economies reopening worldwide and more people shopping online.
Payment companies are seeing volumes rebound from the coronavirus-induced slump as massive government stimulus and speedy vaccine rollouts fuel an economic recovery, unleashing pent-up demand for both goods and services.
The reopening of the U.S. economy has also fueled widespread demand for travel and shopping from consumers stuck indoors for more than 18 months, but there are fears that supply constraints could disrupt the holiday shopping season.
Visa’s net income rose to $3.58 billion, or $1.65 per Class A share, for the fourth quarter ended Sept. 30, from $2.14 billion, or 97 cents per Class A share, a year earlier.
Analysts on average had expected a profit of $1.54 per share, according to Refinitiv data.
Total cross-border volume rose 38% on a constant dollar basis from a year earlier.
“Our performance was driven by the continuation of the recovery in many global economies,” Chief Executive Officer Alfred Kelly Jr said.
The health crisis has also triggered a massive shift in consumer spending towards e-commerce and brought a greater share of transactions to payment companies.
Total payment volumes rose 17% on a constant dollar basis from a year earlier, while the number of transactions processed by Visa rose 21% to 45.3 billion.
American Express reported a profit that topped Wall Street estimates last week, as higher usage of its cards, particularly by millennial and Gen Z customers, fueled a strong recovery in overall spending.
(Reporting by Noor Zainab Hussain and Sweta Singh in Bengaluru; Editing by Devika Syamnath)