Visa beats fourth-quarter income estimates amid resilient consumer spending

Investing.com -- Visa (NYSE:V ) reported fourth-quarter earnings that surpassed analyst estimates, suggesting some resilience in US consumer spending despite lingering - albeit fading - pressures from a time of elevated inflation. 

Despite many shoppers choosing to forego purchases on pricier items as they grapple with higher living costs, US consumer spending has been remained broadly resilient, fueling hopes of a so-called "soft landing" for the wider economy. In this scenario, an era of heightened interest rates successfully quells inflation without sparking a deep downturn in growth or labor demand.

The global payments group reported adjusted earnings per share of $2.71 for the quarter ended Sept. 30, beating analysts' consensus of $2.58. Revenue for the quarter came in at $9.6 billion, representing a 12% increase versus the year-ago period and exceeding Wall Street projections of $9.49 billion. 

Payments volume increased 8% year-on-year. Cross-border volume, excluding transactions within Europe, rose 13% on a constant-dollar basis. Total processed transactions reached 61.5 billion, a 10% uptick.

"Consumer spend across all segments from low to high spend has remained relatively stable to [the third quarter]. Our data does not indicate any meaningful behavior change across consumer segments from last quarter," Chief Financial Officer Chris Suh told analysts in a post-earnings call.

For its 2025 fiscal year, Visa guided for adjusted net revenue growth in the high single digits to low double digits, Analysts had estimated a rise of 10.8%, according to LSEG data cited by Reuters.

"We believe [the fourth-quarter] results and the [2025] guide are another proof point in the breadth and depth of Visa’s business and we see potential volume and growth upside with an economic recovery," analysts at Deutsche Bank led by Bryan Keane said in a note to clients.

Shares in Visa edged higher in premarket US trading on Wednesday.

(Senad Karaahmetovic contributed reporting.)

Source: Investing.com