Riding on the back with a boost in domestic spending, which has bounced back to close to pre-pandemic levels, and with international travel on the road to recovery with increased vaccinations across the globe, Visa Inc announced its quarterly profits which beat analysts’ estimate.
Payment companies are seeing an uptick in volumes following travel and entertainment sectors gathering force and the rise of e-commerce during COVID-19 lockdowns.
Visa reported a 34% jump in third-quarter payment volumes on a constant dollar basis, while the number of transactions processed jumped by a whopping 39%.
“In our domestic businesses, we are pretty much back to where we were, had the pandemic never happened,” said Vasant Prabhu, VISA’s Chief Financial Officer. “The one area of our business that is still not back to where it was is cross-border travel. That is the next stage of recovery”.
VISA’s cross-border volumes also surged by 47% on a constant currency basis in the quarter.
VISA also reported travel spending volumes approaching 2019 pre-pandemic levels in July, while entertainment surpassed those levels in May, said Prabhu to analysts on a call.
Total revenues rose by 27% to $6.13 billion in this quarter. Assuming the July trends continues, Visa’s fourth-quarter net revenue growth is expected to be in line with the third quarter, added Prabhu.
VISA reported a net income of $2.58 billion in the quarter ended June 30, up from $2.37 billion a year earlier. On an adjusted basis, it reported a profit of $1.49 per share. So far, no evidence has emerged on the impact from the Delta variant of the coronavirus on people buying things in their home countries.
“Even as infections are climbing, people don’t seem to be changing their habits like they were before,” said Prabhu.