Here's our initial take on Visa's (NYSE: V) fiscal 2025 second-quarter financial report.
Key Metrics
| Metric |
Q2 2024 |
Q2 2025 |
Change |
vs. Expectations |
| Revenue |
$8.8 billion |
$9.6 billion |
+9% |
Beat |
| Earnings per share (adjusted) |
$2.51 |
$2.76 |
+10% |
Beat |
| Processed transactions |
55.5 billion |
60.7 billion |
+9% |
n/a |
| Payments volume |
$3.17 trillion |
$3.34 trillion |
+5% |
n/a |
Consumer Spending Holds Up
Economic uncertainty has ramped up since Visa last reported its results in January, but it was largely business as usual for the credit card giant in its fiscal second quarter. Revenue and processed transactions jumped 9% year over year, while total payments volume jumped 5%. Adjusted for currency, payments volume was up 8%. "Consumer spending remained resilient, even with macroeconomic uncertainty," noted Visa CEO Ryan McInerney.
While GAAP net income dipped slightly due to some nonrecurring litigation expenses, adjusted net income rose by 6%. Share buybacks over the past year have driven down the share count, which pushed adjusted earnings per share up by 10%. Visa has $4.7 billion remaining under its previous share-repurchase authorization. In April, the company allocated an additional $30 billion for share buybacks which will be used over the course of multiple years.
While Visa's year-over-year growth slowed down a bit from the first quarter, the company put up strong results considering the macroeconomic backdrop.
Immediate Market Reaction
Shares of Visa were up about 2% in early after-hours trading soon after the fiscal second-quarter report was released. The company beat analyst estimates for revenue and earnings, and the generally strong results despite recent economic upheaval were likely reassuring to investors. Visa stock still trades below its 52-week high, but it's regained much of the ground it lost earlier this year.
What to Watch
Visa doesn't provide guidance in its earnings report, but the company has an earnings call with analysts scheduled for Tuesday evening. How the company sees consumer spending evolving given the abrupt tariffs put into place by the Trump administration will certainly be of interest. Visa's various value-added services provide some diversification, but the company's core business is exposed to a potential economic slowdown.
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Timothy Green has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Visa. The Motley Fool has a disclosure policy.
