Visa profit beats expectation on resilient consumer spending

VISA’S fourth-quarter profit beat Wall Street expectations on Tuesday (Oct 29), as consumers set aside worries of a slowing economy and swiped their cards to splurge on travel and dining out, sending its shares up 2 per cent in trading after the bell.

US consumer spending has remained largely resilient despite elevated interest rates, with analysts expecting a soft landing for the economy to boost confidence and reignite spending growth.

Payments volume rose 8 per cent in the quarter on a constant US dollar basis, while cross-border volume excluding intra-Europe, a gauge of international travel demand, surged 13 per cent.

Visa chief financial officer Chris Suh on a call with analysts said consumer spend across all segments has remained relatively stable, compared with the third-quarter.

The world’s largest payments processor forecasts full-year 2025 adjusted net revenue growth of high single digits to low double digits. That compares with Wall Street expectations of 10.8 per cent growth, according to data compiled by LSEG.

It expects adjusted profit per share growth to be at the high end of low double digits, compared with expectations of 11.7 per cent growth.

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Meanwhile, the US Justice Department last month sued Visa for allegedly monopolising debit card markets. Visa has called the claims meritless.

The lawsuit came months after another major legal setback for Visa, when a judge in June rejected a US$30 billion antitrust settlement wherein Visa and Mastercard had agreed to limit fees they charge merchants.

Visa is also reportedly planning to lay off about 1,400 employees and contractors by the end of the year. The company currently employs more than 30,000 employees.

Visa’s net revenue jumped 12 per cent to US$9.62 billion in the quarter, beating expectations of US$9.49 billion.

Its fourth-quarter adjusted profit of US$2.71 per share topped expectations of US$2.58.

Visa’s shares have gained 8.3 per cent in 2024, trailing the 22 per cent jump in the benchmark S&P 500 index. REUTERS