Visa (V) Q4 Earnings and Revenues Top Estimates, Rise Y/Y

Visa Inc (NYSE:V). V reported fourth-quarter fiscal 2021 earnings of $1.62 per share, which outpaced the Zacks Consensus Estimate by 5.88%. The bottom line improved 45% year over year.

Net revenues rose 29% year over year to $6.6 billion in the quarter under review. The top line beat the consensus mark by 1.2%.

Results were aided by solid growth in payments volume, processed transactions and cross-border volume, partly offset by elevated operating costs.

Financial Performance

Payments volume of Visa climbed 17% year over year in the third quarter. The company’s processed transactions grew 21% year over year to 45.3 billion, courtesy of domestic transactions.

Total cross-border volume improved 38% year over year in the quarter. Its cross-border volume excluding transactions within Europe usually bolsters the company’s international transaction revenues.

Service revenues surged 41% year over year to $3.1 billion, driven by an improved payments volume recorded in the prior quarter. While data processing revenues climbed 20% from the prior-year quarter to $3.4 billion, international transaction revenues of $1.79 billion soared 41% year over year. Other revenues grew 36% year over year to $490 million.

Client incentives increased 40% year over year to $2.4 billion in the quarter under review.

Operating expenses of $2.2 billion escalated 15% year over year due to rise in marketing, personnel and professional fees.
Interest expense declined 13.8% year over year to $125 million in the quarter.

Balance Sheet (as of Sep 30, 2021)

Visa exited the quarter with cash and cash equivalents of $16.5 billion, which increased 1.2% from the level at the fiscal-year end on Sep 30, 2020.
Total assets were $82.9 billion, up 2.4% from the fiscal-year end level as of Sep 30, 2020.

Long-term debt decreased 5.2% to $20 billion from the fiscal-year end reading on Sep 30, 2020.

Share Buyback and Dividend Update

In the quarter under review, the company bought back shares worth $3.1 billion.

The board of directors increased Visa's quarterly cash dividend by 17% to 37.5 cents per share

Zacks Rank

Visa presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

Other Business Services Sector Releases

Some other companies in the business services space that already released results are Equifax Inc (NYSE:EFX). EFX, American Express Co. AXP and Discover Financial Services (NYSE:DFS) DFS, which beat earnings estimates by 7.6%, 27.53% and 3.51%, respectively.

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