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Visa Q4 Earnings Beat Estimates on Strong Payment Volumes
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Key Takeaways
V's Q4 adjusted EPS rose 17% to $3.48, beating estimates by 1.5%, while revenues grew 13% to $12.1 billion.
Payment volumes increased 9% YoY, while cross-border volume rose 14% and processed transactions grew 10%.
Visa returned $5.2 billion to its shareholders and raised its quarterly dividend 16% to 78 cents per share.
Visa Inc. (V - Free Report) reported fourth-quarter fiscal 2026 adjusted earnings of $3.48 per share, up 17% year over year and beating the Zacks Consensus Estimate by 1.5%.
Net revenues came in at $12.1 billion, rising 13% year over year and topping the consensus mark by 0.5%.
The strong quarterly results reflected higher payment volumes, robust cross-border activity and increased transaction processing. However, the upside was partly offset by increased operating expenses.
On a constant-dollar basis, cross-border volume increased 14% year over year, reflecting international payment activity. Excluding transactions within Europe, cross-border volume also rose 14% in constant dollars. On a constant-dollar basis, payments volume increased 9% year over year to $4.1 trillion.
Network throughput also improved. Total processed transactions were 74.2 billion for the September quarter, marking a 10% year-over-year increase.
Adjusted operating expenses were $4.1 billion, up 12% year over year. It came in a bit higher than our estimate of $4 billion. Higher personnel costs of $1.9 billion and marketing expenses of $711 million were notable contributors, alongside general and administrative expenses of $829 million. The litigation provision totaled $474 million in the quarter, down sharply from $903 million a year ago.
V’s Segment Performance
Service revenues increased 14% year over year to $5.3 billion and beat our model estimate of $5.2 billion, supported by higher payment volumes. Data processing revenues climbed 16% to $6.3 billion and surpassed the Zacks Consensus Estimate of $6.2 billion, benefiting from increased transaction activity across the company's network.
International transaction revenues rose 8% to $4.1 billion and beat our model estimate by 0.8%, while other revenues advanced 40% to $1.7 billion, topping our estimate of $1.5 billion. Offsetting a portion of these gains, client incentives, recorded as a contra-revenue item, increased 21% year over year to $5.1 billion. It came in higher than our estimate of $5 billion.
Visa Returns Capital Aggressively
Visa continued to emphasize shareholder returns. During the quarter, the company repurchased $4 billion of Class A shares and paid $1.3 billion in dividends, totaling $5.2 billion returned to its shareholders. V had $24.4 billion remaining under its repurchase program as of Sept. 30, 2026.
Cash generation remained solid. Free cash flow was $6.9 billion in the quarter, after $493 million of capital expenditures. Visa ended Sept. 30, 2026, with $14.2 billion in cash, cash equivalents and investment securities. Its long-term debt amounted to $19.4 billion, down from $19.6 billion at fiscal 2025-end. Current maturities of debt were $2.7 billion.
The board also approved a 16% increase in its quarterly cash dividend to 78 cents per share, payable Dec. 1, 2026, to shareholders of record as of Nov. 10.
V’s FY26 Update
In fiscal 2026, Visa achieved net revenues of $45.9 billion, marking a 15% year-over-year increase. Adjusted EPS increased 16% year over year to $13.27.
Visa’s payments volume rose 9% year over year on a constant-dollar basis. Processed transactions totaled 281.3 billion, representing a 9% year-over-year increase. Cross-border volume expanded 13% on a constant-dollar basis in fiscal 2026.
V Outlines Strong Growth Targets Ahead
For the first quarter of fiscal 2027, Visa expects net revenues and operating expenses to grow at low-double-digit rates on a non-GAAP adjusted constant-dollar basis. Adjusted earnings per share growth is projected at the low end of the mid-teens range.
For full-year fiscal 2027, management anticipates low-double-digit net revenue growth and operating expense growth. Adjusted earnings per share are expected to increase at a low-double-digit to low-teens rate, reflecting continued expectations for growth in the company's payments business.
Major rival Mastercard Incorporated (MA - Free Report) is scheduled to report third-quarter 2026 results on Oct. 29. The Zacks Consensus Estimate for adjusted earnings is pegged at $5.14 per share, indicating 17.4% year-over-year growth. The same for revenues is pegged at $9.6 billion, signaling a 12% increase. MA beat earnings estimates in each of the past four quarters with an average surprise of 6.3%.
American Express Company (AXP - Free Report) reported third-quarter 2026 EPS of $4.68, which surpassed the Zacks Consensus Estimate by 4.7%. The bottom line advanced 13% year over year. Total revenues, net of interest expense, improved 9% year over year to $20.1 billion. AXP’s quarterly results were driven by increased Card Member spending, higher net interest income and improved card fee growth. However, the upside was partly offset by elevated operating expenses.
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Visa Q4 Earnings Beat Estimates on Strong Payment Volumes
Key Takeaways
Visa Inc. (V - Free Report) reported fourth-quarter fiscal 2026 adjusted earnings of $3.48 per share, up 17% year over year and beating the Zacks Consensus Estimate by 1.5%.
Net revenues came in at $12.1 billion, rising 13% year over year and topping the consensus mark by 0.5%.
The strong quarterly results reflected higher payment volumes, robust cross-border activity and increased transaction processing. However, the upside was partly offset by increased operating expenses.
Visa Inc. Price, Consensus and EPS Surprise
Visa Inc. price-consensus-eps-surprise-chart | Visa Inc. Quote
Visa’s Q4 Highlights
On a constant-dollar basis, cross-border volume increased 14% year over year, reflecting international payment activity. Excluding transactions within Europe, cross-border volume also rose 14% in constant dollars. On a constant-dollar basis, payments volume increased 9% year over year to $4.1 trillion.
Network throughput also improved. Total processed transactions were 74.2 billion for the September quarter, marking a 10% year-over-year increase.
Adjusted operating expenses were $4.1 billion, up 12% year over year. It came in a bit higher than our estimate of $4 billion. Higher personnel costs of $1.9 billion and marketing expenses of $711 million were notable contributors, alongside general and administrative expenses of $829 million. The litigation provision totaled $474 million in the quarter, down sharply from $903 million a year ago.
V’s Segment Performance
Service revenues increased 14% year over year to $5.3 billion and beat our model estimate of $5.2 billion, supported by higher payment volumes. Data processing revenues climbed 16% to $6.3 billion and surpassed the Zacks Consensus Estimate of $6.2 billion, benefiting from increased transaction activity across the company's network.
International transaction revenues rose 8% to $4.1 billion and beat our model estimate by 0.8%, while other revenues advanced 40% to $1.7 billion, topping our estimate of $1.5 billion. Offsetting a portion of these gains, client incentives, recorded as a contra-revenue item, increased 21% year over year to $5.1 billion. It came in higher than our estimate of $5 billion.
Visa Returns Capital Aggressively
Visa continued to emphasize shareholder returns. During the quarter, the company repurchased $4 billion of Class A shares and paid $1.3 billion in dividends, totaling $5.2 billion returned to its shareholders. V had $24.4 billion remaining under its repurchase program as of Sept. 30, 2026.
Cash generation remained solid. Free cash flow was $6.9 billion in the quarter, after $493 million of capital expenditures. Visa ended Sept. 30, 2026, with $14.2 billion in cash, cash equivalents and investment securities. Its long-term debt amounted to $19.4 billion, down from $19.6 billion at fiscal 2025-end. Current maturities of debt were $2.7 billion.
The board also approved a 16% increase in its quarterly cash dividend to 78 cents per share, payable Dec. 1, 2026, to shareholders of record as of Nov. 10.
V’s FY26 Update
In fiscal 2026, Visa achieved net revenues of $45.9 billion, marking a 15% year-over-year increase. Adjusted EPS increased 16% year over year to $13.27.
Visa’s payments volume rose 9% year over year on a constant-dollar basis. Processed transactions totaled 281.3 billion, representing a 9% year-over-year increase. Cross-border volume expanded 13% on a constant-dollar basis in fiscal 2026.
V Outlines Strong Growth Targets Ahead
For the first quarter of fiscal 2027, Visa expects net revenues and operating expenses to grow at low-double-digit rates on a non-GAAP adjusted constant-dollar basis. Adjusted earnings per share growth is projected at the low end of the mid-teens range.
For full-year fiscal 2027, management anticipates low-double-digit net revenue growth and operating expense growth. Adjusted earnings per share are expected to increase at a low-double-digit to low-teens rate, reflecting continued expectations for growth in the company's payments business.
V’s Zacks Rank
Visa currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
How Are Visa’s Peers Placed This Quarter?
Major rival Mastercard Incorporated (MA - Free Report) is scheduled to report third-quarter 2026 results on Oct. 29. The Zacks Consensus Estimate for adjusted earnings is pegged at $5.14 per share, indicating 17.4% year-over-year growth. The same for revenues is pegged at $9.6 billion, signaling a 12% increase. MA beat earnings estimates in each of the past four quarters with an average surprise of 6.3%.
American Express Company (AXP - Free Report) reported third-quarter 2026 EPS of $4.68, which surpassed the Zacks Consensus Estimate by 4.7%. The bottom line advanced 13% year over year. Total revenues, net of interest expense, improved 9% year over year to $20.1 billion. AXP’s quarterly results were driven by increased Card Member spending, higher net interest income and improved card fee growth. However, the upside was partly offset by elevated operating expenses.