![]() Visa Inc. Fiscal Third Quarter Financial Results July 28, 2010 Exhibit 99.2 |
![]() 2 Fiscal Q3 2010 Earnings Results 2 Safe Harbor Reminder • Certain statements contained in this presentation are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sections. These statements can be identified by the terms “continue,” “will” and similar expressions which are intended to identify forward-looking statements. In addition, any underlying assumptions are forward-looking statements. Such forward-looking statements include but are not limited to statements regarding certain of Visa’s goals and expectations with respect to tax rate, capital expenditures, revenue, incentives, expenses, operating margin, earnings per share, free cash flow, and the growth rate in those items, as well as other measures of economic performance. • By their nature, forward-looking statements: (i) speak only as of the date they are made, (ii) are not guarantees of future performance or results and (iii) are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward- looking statements as a result of a variety of factors, including all the risks discussed under the heading “Risk Factors” in Part 1, Item 1A – “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q or Periodic Reports on Form 8-K, if any. You are cautioned not to place undue reliance on such statements, which speak only as of the date of this presentation. Unless required to do so under U.S. federal securities laws or other applicable laws, we do not intend to update or revise any forward-looking statements. |
![]() 3 Fiscal Q3 2010 Earnings Results Solid Fiscal Third Quarter Results • Strong operating revenues of $ 2.0 billion, up 23% over prior year • Quarterly net income of $ 716 million, up 45% and diluted earnings of $0.97 per share, up 49% over prior year, excluding prior year gain on VisaNet do Brasil sale • On an as-converted basis, repurchased additional 6.7 million class A common share equivalents, at an average price of $74.22 per share, from the Company’s class B shareholders through the $500 million funding of the litigation escrow • Completed the acquisition of CyberSource Corporation in July 2010 • Positive secular trends and continued spending momentum contributed to solid growth |
![]() 4 Fiscal Q3 2010 Earnings Results 236 380 617 745 449 296 Total Visa Inc. Credit Debit 2009 2010 ROW 34 Quarter ended March US$ in billions, nominal, except percentages Payments Volume ROW 238 ROW 266 U.S. 379 U.S. 427 ROW 318 U.S. 176 204 ROW U.S. 182 U.S. 202 U.S. 245 ROW 51 Note: Figures may not sum due to rounding. Growth rates calculated based on whole numbers, not rounded numbers. From time to time, previously submitted volume information may be updated. Prior year volume information presented has not been updated, as changes made are not material. Constant dollar growth rates exclude the impact of foreign currency fluctuations against the U.S. dollar in measuring performance. YOY Change (nominal) 18% 25% 21% YOY Change (constant) 13% 8% 22% ROW = Rest of World |
![]() ![]() ![]() ![]() 5 Fiscal Q3 2010 Earnings Results 261 426 687 321 481 803 Total Visa Inc. Credit Debit 2009 2010 ROW 41 Quarter ended June US$ in billions, nominal, except percentages Payments Volume ROW 275 ROW 278 U.S. 412 U.S. 469 ROW 334 U.S. 192 234 ROW U.S. 204 ROW 56 Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on payments volume in the prior quarter. From time to time, reported payments volume information may be updated to reflect revised client submissions or other adjustments. Prior year volume information presented has not been updated, as changes made are not material. Figures may not sum due to rounding. ROW = Rest of World YOY Change (nominal) 17% 13% 23% YOY Change (constant) 14% 9% 22% U.S. 220 U.S. 265 |
![]() 6 Fiscal Q3 2010 Earnings Results 379 147 42 32 17 23 43 58 195 427 United States Asia Pacific Latin America and Caribbean Canada Central and Eastern Europe, Middle East and Africa 2009 2010 Quarter ended March US$ in billions, nominal, except percentages Payments Volume Note: Growth rates calculated based on whole numbers, not rounded numbers. From time to time, previously submitted volume information may be updated. Prior year volume information presented has not been updated, as changes made are not material. Constant dollar growth rates exclude the impact of foreign currency fluctuations against the U.S. dollar in measuring performance. YOY Change (nominal) 13% 32% 38% 34% 31% YOY Change (constant) 13% 14% 20% 9% 17% |
![]() ![]() ![]() ![]() 7 Fiscal Q3 2010 Earnings Results 20 41 49 165 412 25 50 62 197 469 United States Asia Pacific Latin America and Caribbean Canada Central and Eastern Europe, Middle East and Africa 2009 2010 Quarter ended June US$ in billions, nominal, except percentages Payments Volume Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on payments volume in the prior quarter. From time to time, reported payments volume information may be updated to reflect revised client submissions or other adjustments. Prior year volume information presented has not been updated, as changes made are not material. Figures may not sum due to rounding. YOY Change (nominal) 14% 19% 26% 22% 27% YOY Change (constant) 14% 12% 22% 12% 24% |
![]() 8 Fiscal Q3 2010 Earnings Results 14,305 9,360 15,491 10,266 10,648 11,721 16,118 17,596 Total Transactions Processed Transactions Total Transactions Processed Transactions 2009 2010 Quarter ended March in millions, except percentages Transactions Note: Processed transactions represent transactions involving Visa, Visa Electron, Interlink and Plus cards processed on Visa’s networks. Total transactions represent payments and cash transactions as reported by Visa members on their operating certificates. From time to time, previously submitted volume information may be updated. Prior year volume information presented has not been updated, as changes made are not material. Quarter ended June Debit 64% Credit 36% Credit 37% Debit 63% Credit 37% Debit 63% Credit 35% Debit 65% YOY Change 13% 14% 14% 14% |
![]() 9 Fiscal Q3 2010 Earnings Results 798 925 1,723 1,825 1,051 774 Credit Debit Visa Inc. 2009 2010 Quarter ended March in millions, except percentages Total Cards YOY Change (3%) 14% 6% Note: From time to time, previously submitted cards information may be updated. Prior year cards information presented has not been updated, as changes made are not material. |
![]() 10 Fiscal Q3 2010 Earnings Results 1,990 (344) 1,646 2,422 (393) 2,029 Fiscal 2009 Fiscal 2010 Revenue – Q3 2010 US$ in millions, except percentages Gross Revenues Incentives Net Operating Revenues YOY Change 22% 15% 23% Note: Growth rates calculated based on whole numbers, not rounded numbers. |
![]() 11 Fiscal Q3 2010 Earnings Results Revenue Detail – Q3 2010 US$ in millions, except percentages Service Revenues Data Processing Revenues International Transaction Revenues Other Revenues 769 605 458 158 183 574 792 873 Fiscal 2009 Fiscal 2010 YOY Change 13% 31% 25% 15% Note: Growth rates calculated based on whole numbers, not rounded numbers. |
![]() 12 Fiscal Q3 2010 Earnings Results Operating Margin – Q3 2010 US$ in millions, except percentages 1,646 824 822 1,137 892 2,029 Net Operating Revenues Total Operating Expenses Operating Income 50% 56% Operating Margin Fiscal 2009 Fiscal 2010 YOY Change 6 ppts 23% 8% 38% Note: Growth rates calculated based on whole numbers, not rounded numbers. |
![]() 13 Fiscal Q3 2010 Earnings Results 97 229 57 96 824 1 62 282 285 103 277 77 63 87 892 Fiscal 2009 Fiscal 2010 Operating Expenses – Q3 2010 US$ in millions, except percentages Personnel Network, EDP and Communications Advertising, Marketing and Promotion Professional and Consulting Fees Depreciation and Amortization Administrative and Other Total Operating Expenses Litigation Provision YOY Change 1% 6% 20% 24% 10% (9%) (38%) 8% Note: Growth rates calculated based on whole numbers, not rounded numbers. 0 |
![]() 14 Fiscal Q3 2010 Earnings Results Other Financial Results • Cash, cash equivalents, restricted cash and available-for-sale investment securities of $7.4 billion at the end of the fiscal third quarter which includes $ 2.0 billion of restricted cash for litigation escrow • Fiscal third quarter free cash flow of $1.2 billion • Capital expenditures of $65 million during the fiscal third quarter |
![]() 15 Fiscal Q3 2010 Earnings Results Less than $1 billion Advertising, marketing and promotion expenses Less than $1 billion Annual net revenue growth Financial Metrics for Fiscal Year 2010 Annual operating margin Mid to high 50% range High end of 16-17% range Volume and support incentives as % of gross revenues High end of 11-15% range |
![]() 16 Fiscal Q3 2010 Earnings Results Financial Metrics for Fiscal Year 2010 Capital Expenditures Moderately above $200 million Annual diluted class A common stock earnings per share growth 20% + GAAP tax rate 37% to 38% range Annual free cash flow $2 billion + |
![]() 17 Fiscal Q3 2010 Earnings Results Financial Metrics for Fiscal Year 2011 Annual diluted class A common stock earnings per share growth 20% + Annual free cash flow $2 billion + |
![]() Appendix Reconciliation of Non-GAAP Measures |
![]() ![]() Fiscal Q3 2010 Earnings Results Calculation of Free Cash Flow US$ in millions A1 Additions (+) / Reductions (-) to Net income attributable to Visa Inc. Net income attributable to Visa Inc. (as reported) 716 2,192 Capital Assets + Depreciation and amortization 63 187 - Capital expenditures (65) (2) (144) 43 Litigation + Litigation provision - (41) + Accretion expense 7 23 - Settlement payments (71) (215) + Settlement payments funded by litigation escrow 70 6 210 (23) Share-based Compensation + Share-based compensation 34 95 Pension + Pension expense 9 31 Taxes + Income tax expense 406 1,252 - Income taxes paid (218) 188 (977) 275 Changes in Working Capital (1) +/- Changes in other working capital accounts 231 (25) Total Free Cash Flow 1,182 2,588 Less: Retailers' Litigation Prepayment - Settlement payment - (682) Adjusted Free Cash Flow 1,182 1,906 (1) Includes changes in volume & support incentives, trade receivables, settlement receivable/payable, and personnel incentives. For the nine months ended June 30, 2010 For the three months ended June 30, 2010 |