01—Abstract
Summary
Summary of the 10-Q filed July 29, 2021. Cited figures are marked; the original filing is the authoritative source.
Visa Inc. reported strong financial performance for the third quarter of fiscal year 2021, ending June 30, 2021.
The company saw a significant increase in net revenues, driven by the recovery in payment volumes and processed transactions as economies reopened from COVID-19 impacts. This growth was particularly evident in the quarter-over-quarter comparison, indicating a robust rebound. While operating expenses also increased, primarily due to investments in personnel and marketing, the company maintained healthy profitability.
Visa continues to execute on its strategic priorities, including expanding its payment network and pursuing strategic acquisitions like Tink AB and Currencycloud, which are expected to enhance its open banking and cross-border payment capabilities. The company also continued its share repurchase program and dividend payments, reflecting a strong commitment to returning value to shareholders.
02—Key points
Key Highlights
- Net revenues increased by 27% year-over-year for the three months ended June 30, 2021, reaching $6.13 billion, driven by recovery in payment volumes and processed transactions.
- Processed transactions saw a significant increase of 39% year-over-year for the three months ended June 30, 2021.
- The company is strategically expanding through acquisitions, with definitive agreements to acquire Tink AB for €1.8 billion and Currencycloud for £700 million.
- Operating expenses rose by 12% year-over-year for the quarter, largely due to increased personnel and marketing costs.
- Net income for the quarter was $2.575 billion, a 9% increase year-over-year.
- Visa repurchased 10 million shares of its class A common stock for $2.2 billion during the quarter, with $7.8 billion remaining under its repurchase program.
- The company declared a quarterly cash dividend of $0.32 per share, continuing its commitment to shareholder returns.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2021filed July 29, 2021Financial Statements
Q3 FY2021 against Q3 FY2020
| Line item | Q3 FY2021Q3 FY2020 | Change |
|---|---|---|
| Revenue | $6.13B$4.84B | +26.7% |
| Operating Expenses | $2.07B$1.84B | +12.4% |
| Operating Income | $4.06B$3.00B | +35.5% |
| Net Income | $2.58B$2.37B | +8.5% |
05—Questions
Frequently Asked Questions
How did Visa's revenue perform in the third quarter of fiscal year 2021?
Visa's net revenues increased by 27% year-over-year to $6.13 billion for the three months ended June 30, 2021. This growth was primarily driven by a rebound in payment volumes and processed transactions as economies began to recover from the COVID-19 pandemic.
What are Visa's key growth strategies and recent developments?
Visa is focused on expanding its payment network and pursuing strategic acquisitions. The company has entered into definitive agreements to acquire Tink AB, a European open banking platform, and Currencycloud, a UK-based global platform for foreign exchange solutions. These acquisitions aim to strengthen Visa's position in open banking and cross-border payments.
How is Visa returning capital to shareholders?
Visa continues to return capital to shareholders through its share repurchase program and dividend payments. During the quarter ended June 30, 2021, the company repurchased $2.2 billion of its stock and declared a quarterly cash dividend of $0.32 per share. As of June 30, 2021, Visa had $7.8 billion remaining under its share repurchase authorization.
What is the impact of the UK tax rate change on Visa's financials?
The UK enacted legislation to increase its corporate tax rate from 19% to 25%, effective April 1, 2023. In response, Visa recognized a non-recurring, non-cash tax expense of $1.0 billion in the three months ended June 30, 2021, due to the remeasurement of its net UK deferred tax liabilities. This significantly impacted the effective tax rate for the period.
06—Continue