Visa reported a robust 9% growth in card-spending volume, reaching US$3.17 trillion in the last quarter, surpassing Wall Street’s expectations. The surge was driven by strong consumer demand for travel and dining out, indicating a positive outlook for the industry despite concerns about interest rate hikes.
27 July 2023 – Visa Inc. reported robust card-spending growth in the fiscal third quarter, surpassing Wall Street’s expectations, driven by strong consumer demand for travel and dining out. Payments volume climbed 9% to $3.17 trillion in the quarter, beating analysts’ average estimate of $3.14 trillion. Visa’s revenue rose 12% to $8.1 billion, exceeding analysts’ predictions of $8.06 billion, and adjusted net income of $4.5 billion, or $2.16 per share, was 5 cents better than estimates.
The continued willingness of cardholders to spend on travel and entertainment has benefited both Visa and its rival, Mastercard Inc. US consumer confidence reached a multi-year high in July due to a strong job market and easing inflation. Visa’s CFO, Vasant Prabhu, expressed confidence that the travel momentum will persist, citing consumers’ pent-up demand for travel. Visa also announced new co-brand credit-card deals during the quarter with Breeze Aviation Group, Allegiant Travel Co., and Indian conglomerate Adani Group, which will grant Visa access to 400 million customers through Adani’s airports and online travel services. Despite concerns about potential slowdowns as central banks raise interest rates, Visa remains optimistic about the consumer’s resilience and stability in spending both domestically and internationally. – source: Bloomberg