TLDR
- Visa posted Q1 fiscal 2026 earnings of $3.17 per share on revenue of $10.9 billion, surpassing analyst estimates
- Payment volumes increased 8% and cross-border transactions grew 12% during the quarter ended December 31
- Shares fell 1.9% as investors weighed higher operating expense projections against the earnings beat
- The company guides for low double-digit revenue growth in Q2 and throughout fiscal 2026
- Stock is down 5.4% year-to-date while the S&P 500 has gained 1.4%
Visa crushed earnings estimates for its latest quarter. The market response was less than enthusiastic.
The payments processor reported earnings of $3.17 per share for its fiscal first quarter. That beat the Street’s $3.14 forecast.
Revenue hit $10.9 billion compared to expectations of $10.69 billion. Both figures marked 15% year-over-year growth.
Robust holiday spending powered the results. Payment volumes jumped 8% in the quarter.
Cross-border volumes climbed 12%. Transaction processing increased 9%.
CEO Ryan McInerney attributed the performance to resilient consumers and a strong holiday season. Higher-income shoppers drove most of the activity.
Record holiday traffic and booming e-commerce sales lifted transaction counts. Budget-conscious households had less room to spend.
Trump’s tariff policies raised consumer prices. This squeezed purchasing decisions for many families.
Expense Growth Weighs on Sentiment
The stock dropped 1.9% Thursday afternoon following the report. Visa shares have declined 5.4% in 2026.
The S&P 500 has climbed 1.4% during the same stretch. Over the past 12 months, Visa is down 3.3%.
Evercore ISI analysts pointed to elevated operating expense guidance as a selloff trigger. Cross-border metric weakness also played a role.
The 12% cross-border growth represents a slowdown from recent quarters. These numbers serve as a window into global trade and travel patterns.
Analysts monitor these figures closely after Trump’s tariff policy shifts. Visa’s finance chief told Reuters tariffs haven’t materially affected business yet.
For Q2 ending March, Visa expects low double-digit net revenue expansion. Operating costs should rise in the mid-teens percentage range.
Diluted earnings per share growth is projected at the high end of low double digits. The full-year fiscal 2026 outlook calls for low double-digit growth in revenue, expenses, and earnings.
Digital Currency Expansion and Industry Pressures
Visa is moving deeper into stablecoin integration. The company sees cryptocurrency as a way to defend its market position.
Management described the stablecoin initiative as complementary to core operations. A December pilot lets select U.S. banks settle payments via Circle’s USDC stablecoin.
The payments sector faces regulatory challenges. Trump proposed a one-year cap on credit card interest rates at 10%.
Current U.S. credit card rates average 19.65%. Analysts suggest the actual impact may be modest.
Visa and Mastercard reached a settlement in November to reduce merchant processing fees. The agreement cuts fees by 0.1 percentage points over five years.
This resolves a 2005 antitrust case. A judge must still sign off on the deal.
Visa’s board approved a quarterly dividend of 67 cents per class A common share. The dividend pays out March 2 to February 10 shareholders of record.
Seaport Research Partners noted Visa typically provides conservative guidance and beats expectations. Mastercard delivered solid quarterly results Thursday as well.
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