Visa (V) 8-K Visa Inc. to Host Investor Conference Call to Discuss Changes to its Income Statement Presentations and Other Pending Financial Impacts

Visa Inc. Financial

Discussion

Byron Pollitt

Chief Financial Officer

October 26, 2010

Exhibit 99.2

Information Classification as Needed

2

Agenda

Incorporating CyberSource

Results

Reporting of Non-Visa Transaction Pass-Through Revenue and Expense

Adjusting for Visa Extras Revenue and Expense

Revaluing the Visa Europe Put Option

2

Information Classification as Needed

Revenue

–

Pre-acquisition, CyberSource

revenue included interchange passed through to issuers

–

Post-acquisition, will report net of interchange, primarily as data processing revenue

–

Will introduce “billable transactions”

as an operating metric

Intangible and Technology Assets

–

Transaction

created

$727

million

in

amortizable

assets,

of

which

$605

million

were

intangibles

–

For first 5 years, annual amortization rate is $76 million

–

Please note that $68 million of annual amortization related to the 2007 reorganization

fully amortized in Q4 FY 2010

Year-Over-Year Comparables

–

FY

2010

included

2

months

of

results

representing

$41

million

in

net

revenue

–

EPS dilution in FY 2011 expected to be slightly dilutive, about 4¢,

compared to 2¢

in Q4 and 3¢

in total for FY 2010

Incorporating CyberSource

Results

3

Information Classification as Needed

Historically, Visa has processed a modest number of non-Visa transactions whereby fees,

primarily interchange, pass through Visa in the settlement process with minimal margin

applied

–

Revenue booked to Data Processing

–

Expense booked to Network

Given a substantial increase in pass-through volume expected in FY 2011, management

revisited its income statement presentation of these transactions

While the “gross”

accounting treatment applied in FY 2010 is acceptable under GAAP,

management believes a “net”

presentation, which only reports Visa’s earned margin as

revenue, is more conservative and better reflects the underlying

economics

Adopting the “net”

presentation means that $140 million of pass-through revenue and

expense booked in FY 2010 will not repeat in FY 2011

The earnings impact is neutral

Beginning next quarter, we will footnote the corresponding pass-through revenue and

expense for FY 2010

Reporting of Non-Visa Transaction

Pass-Through Revenue and Expense

4

Information Classification as Needed

Visa Extras is a turnkey, full feature cardholder rewards program developed to support our

issuers

When a reward is redeemed, the service provider invoices Visa for the cost, and Visa

passes through the expense to the client, no margin is applied

–

Revenue booked to Other

–

Expense booked to Marketing

Two call outs for FY 2011

–

Visa now moving to direct bill, where service provider bills issuer directly, not through Visa

–

Large issuer converted away from platform in June 2010

This means $89 million in revenue and expense booked in FY 2010 will not repeat in

FY 2011

Since this revenue has no margin, earnings impact is neutral

Beginning next quarter, we will footnote the corresponding Extras revenue and expense for

FY 2010

Adjusting for Visa Extras Revenue and Expense

5

Information Classification as Needed

As part of the 2007 reorganization, Visa Europe received a Put option which gives it the

perpetual right to sell its business to Visa Inc.

Visa Inc. recorded a liability of $346 million related to the Put option to reflect that under

certain circumstances, the Put could require Visa Inc. to purchase Visa Europe for an

amount above fair value

Under GAAP, Visa is required to revalue the Put option each quarter, with changes in value

recorded as a non-operating gain or loss in the income statement.  Through Q3, no such

adjustments in value have been required

In Q4, management’s evaluation indicated that the Put option decreased in value by

$79 million, primarily due to the decline in Visa’s forward PE ratio, which, under the terms of

the option, is applied to Visa Europe’s earnings to calculate the purchase price

This change in the Put option value

–

Is recorded as a non-cash income statement event

–

Is not subject to tax

–

Does not reflect any change in Visa Europe’s intent to exercise

Revaluing the Visa Europe Put Option

6