V - Earnings call transcript Q3 2022

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Operator

Welcome to Visa's Fiscal Third Quarter 2022 Earnings Conference Call. All participants are in a listen-only mode until the question-and-answer session. Today's conference is being recorded.

If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host, Ms. President Head Vice Investor Senior Como, and of Global Relations. Jennifer Ms. may begin. you Como,

Jennifer Como

Thanks, to and quarter everyone, Jordan. afternoon, Good welcome call. XXXX Visa's earnings third fiscal

slide Joining Investor Chief replay on posted Financial and containing This statistical call www.investor.visa.com. IR Visa's deck Vasant Al A webcast will Visa's of Officer. us our on our highlights being website. XX Officer; at the Prabhu, and archived Executive days. section and site and Chairman been Chair Vice is today are Relations be A Chief financial for has Kelly, our website on

also many guarantees presentation includes of factors. me as results forward-looking not and you performance, materially are actual our statements Let that future could remind of statements. result this differ These a

concerning of most is website XX-K website. information find those Forms on you section our SEC's on XX-Q, the reports Relations our in and Investor available recent which and the can factors Additional

GAAP in let For reconciliation me disclosed that, Al. non-GAAP call in financial turn with are information the the this over measures earnings And available to and today's release. related call,

Al Kelly

you, and joining thank you afternoon, Jennifer, thank everybody, us. good and for

proven business XXXX, Emeritus. Visa's I and performance. I has war XX% quarter. Dee a from volume was QX consistent payment to XXX% financial from of XXX% to inflation, X grew of and and model X ago, up was volume a be three and levels with about with travel of in of XXX% with acknowledge Ukraine QX. from US XXXX was Chief volumes recession, US, from in index EPS Even ahead payments debit deeply $X.XX, global year-over-year, and QX. macro Visa's significantly XXXX, the was Card-not-present, prepandemic Hock, the volumes revenues the Visa events the whole XXX% Before the QX. the several at a talk Executive concerns of passing US, over very credit Net both broader remained up non-GAAP In XXX% strong to International wanted were to excluding modestly versus up true XXX% XX%. visionary resilient, down family quarter, XXXX, the Officer QX. years in mourns The point to volume of Total Founder loss point great man.

recovery in to XXXX as of Russia, Cross-border X XXX% period QX and QX. versus Excluding commercial XXXX, points were QX, volumes, above XX%, QX XXX% XXX% up XXX% China continue XX% in up Russia. see three ago, excluding we and up QX, points. and cross-border in Russia years travel. it XXXX, numbers. excluding XX to year-over-year includes rose X intra-Europe, X% was transactions and points versus prior point are XX increased from volumes strong Travel-related of in from Process Credentials consumer this were

Before I to dive to strategy, wins moment into inflation. towards and client discuss wanted I take topics: the Recession and two our progress a

facts. continue to of to there in been aggregate, in has the has the credit, this levels, domestic to card From indication And potential including indicates surface backwards I not we're reviewed card been or a weeks. that recession. the continued let's focus likelihood slowdown stable recovery. in debit, payment so improving economic growth the present of and recent any volume, not recovery Instead, of first, the future predict relative the to going of big strengthen, shifts more course, On overall and volume. has the a under or growth the XXXX on I'm demonstrate while forecasters, momentum no with cross-border, most of numbers the XXXX just are In stable

the were seeing from the in services. surpassed goods First, Early trend. pandemic, goods services. historic We to

our months, remained payments six last pre-pandemic the in high, than rebounded levels. goods higher have in services volumes percentage still on as Even the the spending

example, For it of only year-over-year, well the during low improvement pre-pandemic quarter ahead grew spending home and single-digit good remains third retail trendline. while US

Second, many discussionary segments have further strengthened.

the but trendline, versus more year. XX% If not last you grew look spend, is US at it than backed pre-COVID travel to

payments saw last particularly any hotel on spend this hotels affluent and At time, and spending the the in the the areas numbers, the resilient. in XXX% ticket hotel markets. relatively the spend budget consumer range overall entertainment. continue of Based indexing XXXX. average affluent in quarter. Third, our to and XXX% our evidence of same travel with Similarly, restaurant That last outpaced months, We we to to versus in time, six in recover, returning growth non-affluent same versus At trend restaurants, mentioned spend affluent modest spend remained size the continued restaurants the volume improvements. Europe pulling seen in mid-priced category luxury XXXX. haven't back quarter

that homes early words definitive keep few on necessarily the does not inflation their a CPI inflation. few Now, for Visa buy our goods same. or conclusions. though any as draw cards, to just apply on use isn't cards mind with Consumers basket inflation. One, just It's headline to too observations don't of example. number in A the Visa

drives historically, overall is in several XXXX much remains a gap strong between inflationary which to during most Ticket sizes inflation headline XX thus That is around the strong and periods. points pandemic lastly, that said, levels metric Three, even the as US, several factors. the long-term for point we or good inflation have Two, seen our of categories. growth, is see growth, XXXX not and excessive the important due economy. US PCE consumers for growth far, had card-related transaction spend we remain and they relative inflation So, in above to stable.

several inflation we'll an key had we sizes, payments clients. as partnership update this consumer monitor impact important progress of continue issuers as counts, globally. ahead, well volumes to now I'll as remain renewals the transaction with component to all ticket of And Traditional provide Looking of spend With across on categories. a backdrop, growth. potential quarter, our that

Africa. deepen great XX a credit issuers, bank XX terms issuer our the cards. of and Dot, programs agreements growth. in to of we in in our selected Azerbaijan expanded the than issuing with on increase and one with world, our of XX we and have the Saudi seamlessly partnerships X in Arabia XXX the XX credentials, Green Qatar the capabilities, in Finance. partners. with renewed assets that to Brazil with the banks customers. are Caixa, China, some partnerships also the years, million many similar biggest NAV enable to with top recently the past Mobily utilized with M-Pesa users country. India. country's move Australia, our our countries, in In previously relationship in partners begun a issuance already alone, more other credit will prepaid. of grown First, to Japan, and Egypt Europe I have into is in are through the Pago, million important China We In and over Brazil, In around deeper in Starting Pataday report in that Revolut light, X are two which card and in Mercado, just their CDA, of now in payments debit of in we In accounts. for a two Toyota want also agreements the money with fintech a I'm issuer we mentioned renewed Visa world. we our customers, Fintechs with ICBC, we with that initiation with a Visa credit issuing mobile services, Credit around and largest in And credentials. our top who number Currencycloud, consumer largest with partnership cases, terms debit partnership. and and Direct Safaricom, and signed Ooredoo we Azercell particularly Africa two renewed the largest cover issuing extended global part and key Vodacom in important and partners. we issuer XXX Saison, our little operators recently number US, relationship issue customers, these across Revolut our example. Visa Group Orange have Direct a They In with Europe mobile to allow these a payment recently our Tink with continue happy Itaú, renewed the They we also business in issuing with Sub-Saharan operators including customers, dive also relationship and million of XX% markets, million customers million to

credentials million have In including like the instantly Neon do been growing card issuance Banco have acquisition utilizing two Banco in base Brasil their than Further, more them in Pagamentos, to our and platform that fintech credit Visa's traditional issued past environment. a digital partners allows issue digital by years. addition XX cards to Brazil, XP credit partners over

reaching acceptance merchant past for efforts in with more credentials. points the we volume, payment multibillion-dollar largest XX Birla two, across over which that XXX% efforts payments than XXX%. our for collectively Indian quarters we've that One India, side, all across on spending wins a of acceptance XXXX, XX and On The QX revenue X the millions over of doubled last more had paying Aditya Building million of with XXXX, with group in loyalty nearing is to momentum, app evident e-commerce above potential the quarter TataNeu, rewards programs with locations was results off XXXX, of since two super years Finance SBI represent the the volume was few XXX% companies. of our e-commerce in Brazil's Group; of and than third services XXX%. provide and financial In the e-commerce conglomerates are Cards, co-brand Tata their with Brazil.

had In each face-to-face by the there's And spend opportunity reached positive QX. in IndiGo, spend a excited the lift active contactless $XX great cardholder of We the India's trends and digitization. touch average Pay, transactions of terms with passengers. also in transaction in has co-brand now let We're in US, cash about seeing US. and We're number two which of Tap me XX% more month. additional debit on to where briefly airline XXXX, transactions additional for largest still signed

continue, this and expect faster, contactless incremental driving experiences. payment through for to POS transactions volumes card issuers simpler trend We

in first to QX return revenue XXXX, Now new on flows, up the XXXX points QX volume quarter QX, commercial was travel by driven which our XXX% levels. of spend which payments moving was the QX over XX% In travel. of in business growth. had from surpassed X BXB,

the agreement enable their This In card with proud in we is and partner corporate clients to virtual in reached Their a XX%, a based for technology the we're management a trucking Visa to Visa M-PESA, space, them. have excluding payments of this cash capabilities. quarter, fintech is reached credentials. with expense flows. Visa of using excited solutions business make leader platform problem through are agreement will WEX our powerful and to out health reloadable new an the we digital grew of financial significant Russia. many transactions Direct quarter, capability Kenya. African to prepaid global multiyear fleet address travel, with commercial payments, WES a paying fleet In and for

Union their money Visa enabled expanding On upon Direct initial countries Western XXXX. select the has remittance across for globally, in to to Europe customers send rollout side, US their

We also globally. expanded digital Direct to companies premier to accounts payments Canada world's agreement bank our service the cross-border with offer Visa of originating from Remitly, remittance one

marketplace leading a drivers available using Visa GrubHub, a eligible large use Visa and Visa million will cases enabling disbursement, food send remittances ordering to wage On in in their is their delivery LINE Already X earnings over such quickly with as LINE credentials, cities, PXP Another cross-border and issuer, Direct Pay enable domestic Visa X,XXX cards is for Japan. debit outs. now Direct Direct. to expansion cash Pay wallet US and

to our DoorDash excited them are other including SkipTheDishes. join delivery We and for platforms, food

also cards enabler, debit with through locations the be tips accounts of at We TipSend pushed to to reached millions to enable restaurant an thousands US [ph] they disbursements serve. of employees' tip agreement eligible

cash funds fintech, TipSend, and dispersed their accounts States in clients. over of XX% today. an large Wealthsimple, United million for agreement Canada, still a For out X funds in In reached are tips the for with with we

we accounts success largest world's Together, banks. services cross-border the serving Finastra's XXX BXC multiple our deal to to banking access and clients one with eligible recently at the of in business Direct, payouts will key customers small in to are with countries. Finastra, X,XXX and platforms XX currencies world's Visa offer of the enablers and companies Finally, signed top and a open business, software financial we

to scaling. markets other Visa first our of one countries many was US the regions for While Direct, have scale are and that growing achieve we and

For third last example, quarter quadrupled in Latin transactions versus year. America,

use Yape in or America, other launched programs many domestic other such as PLIN programs Cash commercially WhatsApp in We have Central addition over and Peru, for XX cross-border across in PXP and and cases. pilot, to in Brazil

let XX%. some services, of services, Evaluated through had and update new of expanding QX Today, services an revenue through services which growth me geographically move organically existing grow and existing value-added I'll with new our Now provide both to wins entities. on acquired clients, acquisitions. and almost recent adding

dispute of CyberSource recently worldwide an services just merchant payouts enable to our agreement earlier bank added has product. to both capabilities network our where of agnostic secure twice double trade, platform. in with adoption that year-to-date, This to transactions fast network-agnostic million faster win rest cross-border clients. CyberSource network extended CyberSource, and our Secure. Commerce, important as eligible Payments starting strategy requirement money its base its utilizing authentication an that the cardholder as merchant capability, grown as than resolution to PNC Vex API clients XX% driven business. has authentication Visa offers dispute Brazilian XD FX our the offer Vex solutions globally to [ph], recently as intend Europe, and of and mentioned with e-commerce, payment network CyberSource cards. Cardinal one with growing connectivity acquirers platform, Direct customer individual is First, more agnostic solution, will resolution is Global the recently YellowPepper's $XX VERIFI's recent volume our I NCR acquisitions, partners, through most send YellowPepper, payments their VERIFI, the earlier. use for signed Tink's initiation movement corporate staff

than capabilities partners. now innovative called acquisition other tokenization to been several from has Fintech provide fiscal ID clients for XXX selected since we this solutions Token year, more Our cross-border payments. signed exchange December by finally, Currencycloud, have foreign acquired the And

card-not-present Token tokenization solution and their efficiencies Payments network realize strategic services fraud multiple clients. EMV First, will go-forward reduce use ID Global Visa's for as their operational for to

solution payment ACH United Second, the Token of the data to one Visa's in ID account tokenization Token Clearinghouse, ID account utilizing the exchange. US exposed network the industry-first tokens tokenization of in two replace power and with data. payment solution amount This Visa's technology real-time sensitive is chose customer to first reduce payment token unique US secure account networks, States the

analytics. Our past fraudulent data and Key internally launched XX Together our are blocked very powered services over compelling progress FIS, is important. we recently value-added consulting just of through with risk-as-a-service solution One a real-time months billion as experts. developed components Visa payments the solution include in by our from volume. and has over risk monitoring AI-enabled platform $X

fraud of million identified analysis Our potential proactive a testing for exposure to clients. a $XX

We to showed to million remain confident future has to it. skimming checkout strategy payments, we the our and flows progress fuel over mitigate and growth in has consumer detect onto very our fraud monitoring around sum, we of in that, merchant vigilant quarter In relationships movement losses. cloning build to trends made the it detect inject new globe. terminal services on value-added that business and globally. turn the across as ability We strong our from in to e-commerce-related payment me will enable cyber money had $X let continuing With $XX results Vasant. proactively pages criminals economy online the capabilities and Our And and successfully and in our solutions million downloads. a malware blocked attempted prevented over attempts

Vasant Prabhu

afternoon Al. Good you, Thank everyone.

three EPS Europe, growth key a dollars, growth points. growth in and dragged EPS This net March helped strong nearly continued XX%. of to XX%. remained XX% In to XX%. was Our and the out The points XX% was up The excluding constant by revenues by cross-border growth season. travel well growth June. picking XX reported In XX%, index, was US net XXXX. of head was quarter, spend Russia, dollars, fiscal for volume recovery transactions second XXXX. ever as the three has XXX was opening Global almost points with the constant up summer was domestic growth steam, third Europe, inbound strength robust second strengthening jumped over quarter GAAP cross-border points robust beginning index XX%. ex-China from dollar above we up by payments results also travel in as revenue international stable strong EPS US travel XX% non-GAAP was in of few Adjusting X much non-GAAP revenue down levels. revenue EPS a as than Asia into up quarter, Index up to half at net volume, and up Russia, continued. the and versus dollar and in higher the peak and X quarter. highlights. the growth The relative reflected XXXX, in travel within net recovery and Non-GAAP A The pre-COVID and corridor from constant up

Our three and payments, growth XX%. flows value-added consumer services, all grew around engines, revenues new

price $X.X at During we of bought $XXX.XX. back the billion in stock an almost average quarter,

We our MDL escrow at attractive account. years. effect well below achievable to also This issued EUR the same rates million the as eurobond to $XXX X on equivalent XX buyback added with X.X% X.XXX%, from ranging inaugural from We issuance, X ranging stock dollar-denominated debt. coupons maturities $XXX.XX. a to litigation the obtained in We billion on had debt,

prefunded up now September maturities debt have We December. and coming in

Finally, quarter. Russia in late second reminder, as a operations we in suspended the

quarter As noted. Russia, volumes, comparisons include Russia or prior are otherwise unless such, Any transactions periods no numbers. from revenues our third there in to

was payments above XX% Now year-over-year XX% on to the details. and In global constant XXXX. up dollars, volume

over XXX% grew and XX% was few year-over-year, higher improved higher Excluding grew China the up XX% dollar travel e-commerce spend. pre-COVID Debit spend X and Relative credit accelerated significantly region growth than trend XX% above was sustaining stimulus payments points Debit higher pandemic. payments excluding wins. helped as and by client to up Russia, volume points. and International and was X% grew than XX% the three XX%, XX% robust Russia, grew with grew recover. constant big to the card-present spend total XXXX, XXXX. and benefited the XX% and Card-not-present lapping fuel and was XXXX, XX% US, X remain In the and up digitization line, XXXX, from above by as trend to card US present credit from last China cash even and through has XX% Relative excluding recovered. the above year. line fueled above even debit XXXX, X% ago, volume, spike was A has pre-COVID well levels travel, continues XXXX. was to Latin than XX% digitization year-over-year cash volumes, across performance regional highlights. the XX% America XXXX. years

impacted Our CEMEA XXX% XX% and underway client higher than wins grew region, by cash XXXX, excluding by up than and was ex-UK, was reflecting Europe higher XX% a XXXX, UK, led share markets. year-over-year multiple portfolio digitalization. in year-over-year above gains and XX% Russia, Europe in the conversion XX% XXXX,

migrations, more volumes the from the been in quarter. second quarter, XX have than Germany stable points payment third while UK Excluding improved

our second domestic borders China, materially domestic Across levels. XXXX, up Asia, region mostly year-over-year Russia, up over from our Asia of normalizing. process impacted remains Pacific, above the second China is not remains most Russia are suspension but Since quarter. and open operations. did closed Only process not the weakest and were Global transactions off, lifted. and and transactions in excluding quarter, are XX% Japan XXXX by transactions has in XX% improved points reported up process gradually we XX% the restrictions year-over-year five XX% significantly

exceeded The year-over-year in excluding intra-Europe, XXXX. year-over-year and up XXX% XXXX. grew first March May Europe at cross-border. index from levels transactions year-over-year over volume time, and volume, on travel and within cross-border excluding XXX card Cross-border and indexing in travel to Cross-border June. XXXX. April intra-Europe, X% excluding XXX% went pre-COVID Constant low for XXX% related present not XXs grew above travel spend, excluding Now the dollar and XX% XX% to growth, cross-border in and were of XX% the

from or quarter countries, with testing in COVID and We US April. Jamaica, in rapid travel including Inbound and in Caribbean to helped previous lifting than XXXX to are XX June through from testing the requirements non-European been member in into soon below third XX% in nearly the travel. removed years, has entry was religious lifted. travel and and China despite borders XX% open, for except and travel into East some and Russia, XX% requirements recovering Central from inbound XXXX. the for XX% third XX,XXX below as are The In will per Travel Taiwan quarter East, six future May, in Asia, for of A to travel of Several driven from restrictions the climbed levels, increased XX Africa, European travel hopefully in travelers was and driver in the outbound in of Ukraine highlights. dropped people Middle the lifting of eased Japan. travel a for in borders points international cross-border Vietnam, requirements Costa Asia see of pace few pre-arrival restrictions more in Canada, for North from quarter, citizens of reopen requirements states Europe COVID China points holidays requirements and the the especially of China in a the of the very borders will Canada Europe, Asia. sizable now half vaccinated sustain by The XX% Travel April. limit continue and Middle region, the quarter key travel above to by Malaysia including jumped XXXX inbound recovery quarter in to to to recovery travel the XX removed resulting XX%. loss Japan outbound countries, US. Union Asian to April, to With Most travel points protocols travel day. tourists more in strong May. Latin levels. help In Rica the indexed points and of region XX,XXX the our and as America. trajectory XX continue ramp-up Europe CEMEA to XXXX. third dropped the restrictions to testing April increased to be third Mainland testing about inbound travelers, and Europe third in testing XXXX third vaccination of travel levels. into the and XXXX a of open and Australia XX% points opened that Mexico. recovering resulting America to quarter

grew a Moving the financial not review quick Service nominal in Reported now third XX% second volume. results. below to include of before whereas growth, last quarter QX due year transaction quarter operations process payments last primarily to do revenues we Revenue transaction service Data revenues revenues the of QX suspension growth we for volumes -- growth. grew than XX% Russia, suspended processing growth XX%, slower quarter. operations. the payments Russia QX Russia X%, recognized revenues lags since in

the process reported transactions mentioned and transactions our as not in I included such, growth. impact not Russia of were earlier, Russia domestic transactions, loss materially As does

intra-Europe. was However, International volumes nominal data transaction we revenue Revenue periods, growth rate exchange each volume growth cross-border benefits. and over processing XX%. payments growth do we around robust were transactions. across a and Other actions. consulting was anymore. increase Consumer excluding growth revenues negatively impacted and was strong also and high engines, travel data drag. There three growth led growing our by which did volatility high have by about the prior by grew currency two-plus point was revenues select domestic continued XX%, volatility currency transactions in versus cross-border volumes, up processing helped pricing points. the in recovery revenue in services led not XX% four Revenue This XX% from Russia by

was travel by was was grew BXB by up and year-over-year growth XX% globally in carded across XX% part, versus businesses. and volumes broad-based small BXB and driven, or driven recovery. large Growth increased XXXX. flows New Commercial are

and of points. recovery of which an XX.X% Russia approximately solutions. actions. Direct by Excluding services X multi-restrict growth X-point by operations GAAP approximately reduced Non-GAAP were This pricing Russia, reported grew due Tink as revenue volumes, suspension X.X mix. improved as faster-than-expected a operating rates identity volumes higher below consulting revenue US. grew growth by well inclusive point transactions Revenue to the was added were revenues clients the growth and cross-border Visa operating our provision drivers with revenue expenses clients, million litigation. on revenues drag the $XXX expectations. The and was risk select were a added expenses Value-added XX%, Exchange interchange from growth. of services XX%. grew and The of led million. points. strong existing X X expenses The of reduced points. $XXX Currencycloud outside equity XX% suspension greater attrition of by operations Client benefit. incentives Exchange Russia to and primarily our about higher-yielding inclusion recorded Tink from driven investments gross about about rates growth. of Currencycloud about X-point We losses associated include

was non-GAAP million. $XX Excluding non-operating losses, investment expense

through and XX.X%. foreign the prior US tax Our tax non-GAAP matters was rate X rates tax points state from and resolution of non-GAAP GAAP certain primarily by benefited years. related

per XXXX. markets consistent XX%. XX% the trends nearly share in basis, performance up first up EPS X% are EPS XX%. US with X% third credit US remained capital over have up up $X.XX. around $X.XX, versus Constant above three credit Our the debit Through grew quarter returned dollar. and and major XXXX. These strong cross-border volume, XXXX. and billion transactions year-over-year Non-GAAP year-over-year, Europe, a payments business our to stock trends remains in XX. GAAP was grew cross-border was XX% the July, up XX% spend and Card-not-present with XX% XXXX growth XX% a of quarter. XX% versus up above nontravel buybacks, we point stable. excluding year, was growth XX% and with weeks $X.X in volume On was the dollar inclusive of from XX% shareholders of the and With Travel-related up XX% world. recurring last transactions with within quarterly XX% dividend of were X.X stronger XXXX. $X.XXX the tax debit over volumes to up rate Processed was range. year-over-year drag XX%

fourth to now outlook quarter. for Moving our the

we're January seeing no July range pullback XXXX evidence consumer of since in As through volumes indexed payments Al indicated, have XX. versus in a the US mid-XXX spending.

Excluding Russia transactions and China, versus stable since international about have also around been payments Process volumes XXXX. have XXX January. XXX at indexed

trends we quarter. processed will such, we that through in transactions the have payments and assuming continue are fourth seen volume the As

cross-border We than will, lookout confidence. recovery rising Through vigilant had and rates, caused changes we consumer the progressed inflation on the and for of course, July, last high October. and expected interest any further stay declining faster by has

quarter, For growth travel future. of from expect Europe e-commerce near especially in the have cross-border not and leg a travel the and will perhaps which to of XXXX from improvement the US, out await do some last we're next full stable reopening China, we recovery and The into in versus assuming in cross-border Asia. in the and fourth the

driven to performance QX net reported to drag, the of client significantly reduce rate by fourth in and operations these point Tink regions. growth revenues XX% dollar quarter net between revenue the Russia, With could dollars. incentives increasing expect expected subtracts The range continued of This to range to revenues, X.X X XX% X to anticipated at constant grow which suspension volume revenues, which approximately will points. net add teens XX% the strengthen, and are gross assumptions, we by high points. in all Currencycloud, X includes exchange strong approximately which across and has primarily

in year, XX.X% of middle the a incentives we range. XX.X% expect percent to client the of now the revenues gross For as

higher Tink, than This grow non-GAAP includes Russia. at level. to SVP QX costs to reduced increases a are low from employees Personnel operating in annual by about normal reported expenses and add all X points reduce X two expense be will expect since growth. by points points end expense dollars operating the the granting below teens. costs We to quarter expense rates due salary we earlier operating will or could high to three points. of offset This added constant from growth Exchange Currencycloud

in expected XX% is range. to XX.X% tax Our rate the stay to

across While processed stable there's been remains payments globally. volume, and strong. cross-border has spending Growth consumer transactions volume, uncertainty,

so do and adjust to again if environments warranted. We are to to have different demonstrated ability prepared our

stay and will We flexible agile. vigilant,

business back We longer fortunate that, momentum extraordinary are I'll and have With to turn term opportunities. growth Jennifer. with a to great this resilient

Jennifer Como

to And ready Jordan. Vasant. with that, we're Thanks questions, take

Operator

Our from [Operator with Sanjay question KBW. first Sakhrani comes Instructions]

is line Your open.

Sanjay Sakhrani

know didn't for indexing pandemic I be cross-border we would if the normally travel. below Thanks. well occur we're where

the a there's then region? risks strength partly strength help with we're out demand Asia us being associated it's talked fear feel more of cross-border? Thanks. the And the seeing how see about inflation. How pent-up about the Vasant, and in drop-off you guess key. because much about I you then However, non-China that we Could the can you think

Al Kelly

low. I'll and thought Asia think So, being has strongly actually quite as quicker very, Sanjay. that start, travel back come than with cross-border suggested, you I very still and what we

numbers, both dollar up somewhat Vasant's of test the because inbound You -- upside as US, and now has in and recently outbound, until the heard Plus the U.S. COVID the the remarks. still strength to inbound COVID well. of required

a in is see that you going I tickets waiting that, time. yes, experiencing. don't soon. of for the because think of people airline some but is are do So, deterred even I more here that of a cost in around airports of experiential places add expect by anything, for being probably want strong demand, Vasant, that normalize number If my some point probably to of the demand exists to at weighs on of anything? that thing world element some that understaffing higher mind, longer time period for the element to remain there pent-up people And I but is sure,

Vasant Prabhu

Yes. mean, here. of at Clearly, play factors variety I there's a

shift has there First, a preferences. consumer in been general

this goods experiences, not just cross-border to travel. heard from away It's beneficiary from a travel is other of very to You've and much that. move people,

remarks, all domestic As including travel. travel, his in it's Al said

pretty broad-based to travel. desire it's So, a

is second travel. keen are people The to

restrictions as right lifted, soon as reactions So, are you the see away.

In strong. terms where strength of Asia in been clearly, quite the has the is, recovery

interest it's You not in saw out and almost significant and of get And that European points, a it Europe it's amount in of except it Taiwan. Europe. is China, I quarter, across interest Asia. traveling It's in -- very this traveling to places across like Japan and huge strong right. they're to and But easy out improved elsewhere, if of There's continuing. all XX how still much remember Asia, happening for

indexing pretty and recovering Europe at volumes. been relative fast So very to also pre-COVID levels has high is

surprise to XXX indexing high, open. stayed that was is We continues XX always because But into Latin you America last points in area jumped another The in fairly the Latin is traveling told other quite America. that and quarter the it it people for range America. Latin

So left durable. pretty come, to still can as you recovery look this looks as across it, see. There's you

XXXX below US The below XXXX levels. well indexing is levels. was still still Asia

soon. anytime ends this think don’t we So

Jennifer Como

Great.

Next question, Jordan?

Operator

comes next with from Our Ellis Lisa MoffettNathanson. question

is line Your open.

Lisa Ellis

a Zelle to was just domestic callouts afternoon, prepared had comment similar little the of Can and in related that the Visa the to of of us PXP or I services. impact Visa of remarks hoping over might to fraud CFPB PXP perspective bit protections the on you is a news other those and bit Direct. role Al, how fraud Good term? services levels Hi. your Direct different number associated that get you. guys. sort you Thank the color on in investigating of or a how investigation with type Visa give Direct's long are the in

Al Kelly

Well, thanks, Lisa.

One Visa including the utilize and VisaNet isn't has It about on Direct runs on ability related terrific capabilities things have that, of of fraud different KYC all the new it therefore, a VisaNet, those on that to those is related to platform. prevention. to we same the and, running

a with around think continues United ways, to grow the that PXP something big the that expect So, it to use and aware States, very, and continue closely. of value around very that case consumers but I Zelle be sure every as we'll movement closely make a as we can make that world. trust can working to know, to that, is sure single just we're partners and use make you much around underpinning have that basic other to service contributing case as the because in money and we're the do be, just this certainly of as not in sure to world, this well secure I capability certainly, is we're watch is in we'll world, that

Jennifer Como

Jordan? Next question,

Operator

question next Research. with from Wolfe Peller comes Our Darrin

Your line open. is

Darrin Peller

I different ability to manage willingness margins expenses guys. touch scenarios. different really outcomes, want Thanks. on to and forward going and your Hey, in

it increases. like looks salary forward, pulled You

fiscal that kind see then forward normally we to just in were of margins willingness of manage really XXXX? downturns does ability what an And we do growth thinking through, some the going to pull So economically, have you and if OpEx see forward?

Vasant Prabhu

Yes. The pull to get have. means the quarter forward next the when of increase of fourth increases that we lap year, that we'll we salary

into bit yes, it year. a little year that it in this since some next So impact sense, on of comes the moderates

the is based with circumstances, we in have past if move this that think services new services the the existing in new as external us stay trends flexible seen opportunities. and adjust on That being have use the and expansion, business will fast penetration business we a across we clients growth for cases long-term are flows of new and value-added monitoring significant. said, be We for global as You've very opportunities well will adding are and again. developed tremendous to, deeper

we we if to have prioritize, did get you tough, eye times the and pace be during things, we under-investing. you things. So as not long-term that, sequence -- you pandemic, opportunity on the an said Having keeping

back all pull don't You the on investment.

on based do new try a it reality. just to You

scale areas we marketing pandemic, closed. borders during for that where to wouldn't have do in and like on And things made like cross-border again. like because certain back things spending the have we try we'll were or any example, difference So if that

Jennifer Como

question. Next

Operator

from Huang Tien-Tsin JPMorgan. next comes Our question with

open. is line Your

Tien-Tsin Huang

recessions, The you figured so Great know, on I'd side, I one product is resilient more cyclical. hand, Al, but have value-added here. I past of how might the revenue you can more comment services don't much. macro, acceptance, strong But be now thinking or ask resilience. to consumer other thanks on suggest if more would said you the And versus I'm that Hi, want credentials, Very predict be results. you clear. this because might contactless that Visa on here the

So your thinking the crisis But PC now? different on growth past premium clear. I know feel versus Thanks. shocks Any differently? to what might financial from you recessions? has be Do Visa about aside like how and pandemic, new been

Al Kelly

Well, thanks, Tien-Tsin.

any we're think XXXX-XXXX recession, to I different time going company from frame. guess, I very past a back

the be to, tends that added added emphasis of and of which We're slowdown company is stronger the we've card everyday debit, happened flows. for all, new First period. recession, benefited in We're strong a the Europe, we're categories. to to the much our And We alluded services as on last today an in cash acceleration from in this in utilization vehicle, stronger in e-commerce. which people very -- choice and the growth. contributes stronger spend during then we've important Since pandemic. value-added of part you a

to tied Some of are volume. value-added services those

would So category. might it And volumes to have today, people what we to other changing buying to they're the we we or that might services on down, say they're changing is depending the I we more remaining about well. -- is as not recession. will change hand, today in degree choosing But possible would go prior down the and those they're high, paying. not with The that continue are we that that the they but that they value-added some be thing than see volumes And any Visa opportunity for people pay sell very levels, we will that buying, might latter the that we have have go in into baskets fall talked see the what on making they're how overall as spending have. that last

Jennifer Como

question? Next

Operator

next comes Our Rawat Bernstein. Harshita from with question

open. is line Your

Harshita Rawat

Hi, afternoon. good

So up comments Al, I the banking. follow your to want on on

Visa? in closed banking you play? excited a banking how that back, step you taking this on And now for open Thanks. about you just year, acquisition the opportunity in just can role earlier So open are your what and the Tink elaborate that efforts can

Al Kelly

in think that is I positioned. Well, we're open quite think early days, its but banking I well

well you know, zero ground Europe. be banking that As open the to happens for

It things help, the Tink broaden single Europe. our than capabilities to world. with -- good where very we be has that that developers. obviously, primarily allow banks believe us Tink with a our markets and is a allows which relationships API financial already X,XXX discussions certainly for thesis able data. that footprint with in to stronger is, access it and institutions XX Tink, where internally one connectivity of in business be in will operates. in and has we'll have has to the we And greater we're next And their our It financial XX,XXX that's developers there. and We that And a capabilities Tink takes footprint in the as will go to customers,

adoption our open and along steps related also way of our infrastructure just and that the the at customers' the and the think banking We is capabilities protecting help going transaction capabilities accelerate to to fraud all our Europe. cyber in

So matter degree quickly excited just but it off, positioned. takes we're the it well think how about going really we're it. in that good to to shape we're a We of It's does. be the of prospects

Jennifer Como

question? Next

Operator

comes Keane from Bryan Our with next question Deutsche Bank.

open. Your line is

Bryan Keane

consumer to guys. wanted new Hi, XX% services. I and the over flows three ask about in the growing payments, drivers, key all value-added

maybe has new how we flows forward eventually consumer services this some and I some, lap growth. payments comps. growth still juice likely normalize extra and think cross-border about assume As as is to will But going for tougher slow some value-added

Just could hoping segments. and maybe three minuses of you some parse for the the through pluses

Al Kelly

than will that consumer we payments. that on time, upon that the more revenue inbound the grow over be, at when in generate which been cross-border get attractive cross-border sustained And you're in and growth new payments services correct predict basis expectation going back pace come two rate sustained into at want time. beginning in but that back, to think, Well, aspiration from value-added quarters we time, six Bryan, a And investors or in settle point quarters, thesis for allow it some make our we at to been depending whether that happen will to that normal I'm or some will that that's quarters flows certainly ongoing the growth. will level not be attractive the comes growth and rate Asia US some that's therefore, consumer points and has seven numbers us revenue to back to will of point that continues sure company. at to will, the higher percentage

Jennifer Como

Next question.

Operator

question with Don from comes Fargo. next Wells Fandetti Our

is line open. Your

Don Fandetti

of data a weakness effect of show any consumers I just then the just correlation the signs low-end not want more wealth does your given at historically any Visa? the to affluent some for all on seeing weakness. confirm, the US around consumer And so retailers, you're

Al Kelly

smaller also a we'll they're drove tickets, stimulus lunch our their And impact economy isn't office as of touch them. now. said, of And for a categories, among tickets kind a Last percentage touching mix on Affluent elements more home pre-pandemic small taking sizes the might we're to substitutions difficult we below as lapping necessarily actually in definitely work travel, people that consumption same to and in shift. are inflation, there's a have but particularly higher What and and impact result. of -- retailers mornings few Certainly, at level environment. on items, and other as things discretionary and commuting continue us some But discretionary levels buying a place, on working you're of the they trading up, returning restaurants it's this be categories. did, level private volumes. down and to less labels. are Don, they're overall ticket understand from are spenders brands staples or that of spending still year, to number are where The what and don't hybrid time, an people clearly working are that buy of spending have when from in at reduction. know tickets, impact people that are people the in but whether

at So, spending consumers sizes like amount. smaller buying but same less or be could yet spending and package things same amount the the of fuel, snacks example, for buying

Tien-Tsin's Don, people change, likely think they're inflation I paying. they're in I to as how not question, said think, is response earlier, on I clearly, some So, are our what And changes making buying. changing to But in numbers. they're

Vasant Prabhu

heard for question on seeing we're Yes. income any some it, other keep we've people in not spending any by No, evidence of we're slowdown We I seeing mean to looking lower consumers. because your not. going and we're say whether it back that.

consumers things like discretionary Remember, by lapping growth And the people seeing we're robust of wealth If are of of by that mean what's Your is driven quarter. wealth affluent has second growth the stimulus a question, said, quarter this stock that As holding a I very spending some on of seen the payments. that. sizable significant very quarter. last not been and that, affluent a saw included happening that presume is rise I and despite market back. effect evidence reasons one and consumers, on affluent was we've Al some no year lot spending growth effect we in we're the of this coming back good we anything, that? why had the And

Jennifer Como

question, Jordan. Next

Operator

question David Evercore next ISI. from with Our Togut comes

open. is line Your

David Togut

Thank Good you. afternoon.

could But allocation You've this big very environment? your clearly How been pullback capital to is We've seen priorities be aggressive changed in acquisition let's us a particular pretty in a valuations say, you appetite ago? share continuing today obviously update on payments. year pipeline repurchase. and your on and versus,

Vasant Prabhu

has Yes. Capital has approach not -- changed. allocation

said a we've investing generate flow. business. our We is first in As core priority lot before, free cash our of

After we to how opportunities payments does discussed done value-added the companies. buying M&A around capabilities the in than of business past, towards that something enterprises, use they in real-time clearly, by we or some does that traditional tremendous is new invest that of which growth are needs with services open our that, around core expands it's Our flows that and priority the us has do banking what like course, newer of capabilities cases as rather the can or can a with have, geared enhance we've business. and Currencycloud what we and FX new like have capabilities we've our fabulous the Tink in first consumer do, something Fintechs and new like serving is gives

to things for continue look that have. what can will enhance we we So,

In terms bubbly. disciplined clearly, of when are timing we've come back valuations have as things in, stayed and opportunities,

have very a We strong balance sheet.

capacity. tremendous We have

companies M&A in important sale. component is the are value markets to We clearly, be have acquisitions are where levels will the private an future. interested that our But of tell is in definitely where to for justified. Time valuations attractive and get

up, want have they it. M&A-wise. where And clear talk we'll We as to come on expand about we ideas

Jennifer Como

question Next Jordan.

Operator

next question from Our Kumar comes Rayna UBS. with

Your line is open.

Rayna Kumar

you Good your afternoon. actions In revenue. Thanks remarks, question. pricing mentioned helped cross-border for taking your my

think opportunity As you of do pricing breadth look services, to improve more still you your in the and there's certain across areas? products

Al Kelly

Yes.

we Something over years and in sophistication consumer in in of we've But very payments of about watch newer building in services. and got years will our time. business and have we're pricing the that of new pricing be terms -- experience and flows business value-added thoughtful our we in lines

that want the As in stimulates we money and that pricing our digitization various to balances ecosystem more sure more ideally our we times, and is more movement all network. within parties way the many said a cash across more and that we're philosophy make and

more is So, in short, opportunity still think definitely the in there we lever. pricing

Jennifer Como

Next question Jordan.

Operator

from Our Citi. Ashwin next Shirvaikar from question comes

Your line is open.

Ashwin Shirvaikar

of was, far. so quarter Thank pretty unaffected on an you. enterprises, My so you the basically of results your what's banks, the based now? that given out types you conversations Al, Hey are the terms they're comment If It's seems impact seeking merchants pace fintechs, going or question that. and services could in on seeing Great your on and hi consumer Vasant. here. that comments products or decision-making with of in clear either

Al Kelly

then, to continuing which what there really and of a and of off that way, said the things. insight drive pandemic, times into numbers as this a to is goods Vasant's high right workers Vasant this coming response provides exactly have shortage is three any war take. investing driven growth as a point, very undeniably in to inflation our out into and the think talked of I the might action alluded we're a here. and spending in that COGS a XX, don't do that impacts to or to certainly whether think very remarks, being the and of in clients going to And was to level wondering there again, be any some top one, it of which partners few Look, see to to two how have we're But all on of One seeing along any in face a from of history to now, reported July for we're And that levers. might But services vigilant we've as businesses. proactive through environment on a company that consumer be leading we it, happen spending I had the not sure going everybody heard given that that make production that be, now. And throw us or we're requires of future you looking other I at question earlier, that have isn't in anything if really We're But the that the Ukrainian We're input I'd a have not I we shortage recession. same we payments. in to. facilitates long up resilient. kind that, consumer remained everybody remind remains by seen. a has will costs smartly

another our it that. differently consuming for to one regardless they're of people for still good whether So to and need utilizing services do substituting are good, or pay they

Jennifer Como

question? Next

Operator

Faucette James with comes Our Morgan from next Stanley. question

open. line is Your

James Faucette

Great. quite forward, When the Al Thanks Thank Obviously, can metrics, very look is look all about tracking Sanjay or any started travel, the elsewhere? what well you bit off or the we've and indications little you. since around there now the you as all a different indicators? about. and as around guess, you how you commentary, forward as at bookings for especially things lot you I track Thank much. in a at potential talk seeing across talked can changes are Vasant. you what questions And color consumer and

Vasant Prabhu

Yes.

well. as And As said Al don't our holding ahead trend. and bookings, see coincident leading happens. business Whether element said, at want in card-not-present we that. only little travel before spending, bit up We ourselves we change to in a bookings, as bookings cross-border which domestic we'll you into it economic a of it If indicators. view indicators. happen; is there's we've change it's there see those is really are where we forecasters where are said, get those travel probably you that and as I The is, area the travel in of don't look not or no mean, if bookings

what on there trend. is looking we towards So those kinds people before, entertainment purchases. things which Al at towards that, is days, There's out a of around a the there's shift of lot do as discretionary time intuitive. There's XX no least than said, XX, things, a lead during Other and see what shift travel. is change is in -- the couldn't experiences quite pandemic, restaurants,

while the trend were goods much year-over-year, we not As may as growing they're be line. pre-COVID COVID still -- they as above said, well

So there's is nothing point. there the this at of out that ordinary

Jennifer Como

Jordan. Last question

Operator

Jason with America. comes Our from last of Bank Kupferberg question

line open. is Your

Jason Kupferberg

cross-border travel. guys. just Thanks I wanted come to to back

end you that were XXX% the XXXX I at, I target think, was levels know prior of the July, Now in your fiscal of to by at year. be XXX%

of versus you XXXX thoughts where the you. outbound there? of can going US, and versus So comment just the kind there be new And tracking then inbound strength would that's target given your your dollar? on what forward Thank just levels

Vasant Prabhu

mean Yeah. the XXXX very the weeks, few, now It's been US, to XXs. high you for about if not from a couple in we told is months. strong. outbound a US I levels of was Inbound indexing the

it's we saw and where on and a of stair like you is a the bit So that saw growth there. What still we've May room there's side there's levels. you XXXX periods have where cross-border of below see recovery in seen And for we think we little in rapid April January, we because certain variety of then saw October partly countries you a of And restrictions, fairly in and stabilization Omicron like that, remove amount and see huge and happening saw April. travel after a a March and November, December of in you quickly. when amount step

you fourth the world at the most As look open. is quarter, of

big But assuming big are in be quarter. don't the there step is travel a out the improvement We'll stair steady there'll of improvement are we into Europe, improvement steady and Asia, so of out fourth left, openings And wait think why no up which in travel we US. of into XX, It's and travel who people. the because Japan letting see. which low. openings were. there's left China, amount index. XXX the in be It's of like XXX,XXX Japan, big gave very go recovery The people in left course, would we And into what people of you normal still more one-fifth of of is

a So there's few left.

So the quarter, short the answer see we'll is a modest and fourth happens. recovery in what

Jennifer Como

that, like for today. joining we'd with to you And thank us

our If have you team. call feel questions, additional a Investor e-mail to or please have and Relations free Thanks day. again, great any

Operator

today's your you participation Thank for in conference.

time. You may disconnect this at

Visa (V) 26 Jul 222022 Q3 Earnings call transcript