Visa's adjusted profit soars 27%
Visa Inc, the world's largest payments network operator, reported better-than-expected quarterly earnings and said it expects full-year profit at the high-end of its forecast, as it reaps the benefits of its purchase of Visa Europe, Business Insider reported.
Visa's shares were up 2.8 percent at $93.70 in trading after the bell on Thursday, after the company also announced a $5 billion share buyback program.
The company said total payments volume rose 37.2 percent to $1.73 trillion in the second fiscal quarter ended March 31, on a constant dollar basis.
San Francisco-based Visa generates revenue by facilitating credit- and debit-card transactions.
The growth in payments was helped by the addition of Visa Europe, a former subsidiary Visabought in June in a deal worth as much as $23 billion. Visa Europe accounted for 19.4 percent of total payments volume.
Payment volumes in the United States, Visa's largest market, increased 11.7 percent to $775 billion on a constant dollar basis.
The U.S. economy has seen strong jobs growth and rising incomes in the first three months of 2017, which bodes well for consumer spending — a key economic indicator for payments processors like Visa.
Visa updated its full-year forecast, saying it now expects adjusted profit at the high-end of its forecast for a mid-teens percentage point increase.
Net income fell to $430 million or 18 cents per Class A share in the second quarter, from $1.71 billion or 71 cents per Class A share, a year earlier, reflecting a one-time charge related to the purchase of Visa Europe.
Excluding one-time items, Visa earned 86 cents per Class A share, beating analysts' average estimate of 79 cents, according to Thomson Reuters I/B/E/S.
Net operating revenue rose 23.5 percent to $4.48 billion.
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