VISA INC
For the period ended Dec 31, 2024. Filed Jan 31, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2024 · Filed Jan 31, 2025
V$422.65+0.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-07-24.
0001403161-24-000041
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-01-31.
0001403161-25-000017
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 83 previous paragraphs and 82 current paragraphs.
46 unchanged; 26 reworded; 10 added; 11 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
Acquisition. In December 2024, we acquired Featurespace Limited (Featurespace), a developer of real-time artificial intelligence payments protection technology that prevents and mitigates payments fraud and financial crime risks, for a purchase consideration of $946 million. See Note 2—Acquisitions to our unaudited consolidated financial statements.
Current report
•Severance costs. For the three months ended December 31, 2024, we recorded severance costs within personnel expense to realign our organizational structure and focus on areas that will drive higher long-term growth. This broad-based optimization effort has been excluded as it is not representative of our ongoing operations.
Current report
For the three months ended December 31, 2024 and 2023, revenue from value-added services was $2.4 billion and $2.1 billion, respectively. Value-added services revenue increased 17% primarily due to growth in consulting and marketing services, issuing solutions and risk and identity solutions.
Current report
NM - Not meaningful
Current report
•Network and processing expenses increased over the three-month prior-year comparable period primarily due to continued technology and processing network investments to support growth.
Current report
The effective income tax rate decreased over the three-month prior-year comparable period due to various items including a change in the geographic mix of earnings.
Current report
The Organization for Economic Cooperation and Development (OECD) published administrative guidance around the implementation of a 15% global minimum tax (Pillar Two). Various OECD member countries have either enacted or are in the process of enacting Pillar Two legislation. While we do not expect a material tax impact in fiscal 2025, we are monitoring developments and evaluating the potential impact of Pillar Two on future years.
Current report
Investing activities. Cash provided by investing activities increased over the three-month prior-year comparable period primarily due to the absence of investment security purchases and higher proceeds from investment security sales and maturities, partially offset by cash paid for an acquisition in the current period.
Current report
Senior notes. A principal payment on our senior notes of $4.0 billion is due in December 2025 for which we have sufficient liquidity. See Note 7—Debt to our unaudited consolidated financial statements.
Current report
In November 2024, the FASB issued ASU 2024-03, which requires disclosure of additional information about specific expense categories underlying certain income statement expense line items. Subsequently, the FASB also issued an amendment to this standard. The amendments in the ASU are effective for our annual periods beginning October 1, 2027, and interim periods beginning October 1, 2028, and require either prospective or retrospective application. We are currently evaluating the impact of the ASU on our disclosures.
Removed paragraphs (11)
Previous report
Class B-1 common stock exchange offer. In May 2024, we accepted 241 million shares of class B-1 common stock tendered in the exchange offer. In exchange, we issued approximately 120 million shares of class B-2 common stock and 48 million shares of class C common stock. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Previous report
Acquisition. On January 16, 2024, we acquired Pismo Holdings (Pismo), a global cloud-native issuer processing and core banking platform, for a purchase consideration of $929 million. See Note 2—Acquisitions to our unaudited consolidated financial statements.
Previous report
•Indirect taxes. During the three and nine months ended June 30, 2024, as a result of the resolution of an audit, we recognized a benefit within general and administrative expense related to the release of the reserve previously recognized in fiscal 2021. This one-time benefit is not representative of our ongoing operations.
Previous report
•Charitable contribution. During the three and nine months ended June 30, 2024, we donated investment securities to the Visa Foundation and recognized a non-cash general and administrative expense. We have excluded this amount as it does not reflect the underlying performance of our business.
Previous report
•Marketing expenses increased over the three and nine-month prior-year comparable periods primarily due to higher spend including for client marketing and the Olympic and Paralympic Games Paris 2024. The increase during the nine months ended June 30, 2024 was partially offset by spend related to the FIFA World Cup TM in the prior year and absent in the current year.
Previous report
•Professional fees increased over the three and nine-month prior-year comparable periods primarily due to higher consulting fees. The increase during the nine months ended June 30, 2024 also included higher advisory fees.
Previous report
•Interest expense increased during the three months ended June 30, 2024 primarily due to higher losses from derivative instruments and higher interest expense related to taxes. Interest expense increased during the nine months ended June 30, 2024 primarily due to higher losses from derivative instruments, partially offset by higher interest benefit related to taxes and lower interest expense related to lower outstanding debt.
Previous report
The effective income tax rates differ primarily due to the following:
Previous report
•During the nine months ended June 30, 2024, a $184 million tax benefit as a result of the conclusion of an audit; and
Previous report
•During the nine months ended June 30, 2023, a $142 million tax benefit due to the reassessment of an uncertain tax position as a result of new information obtained during an ongoing tax examination.
Previous report
Investing activities. Cash used in investing activities for the nine months ended June 30, 2024 was higher than the prior-year comparable period primarily due to cash paid for acquisitions, net of cash acquired, the absence of cash received from the settlement of net investment hedge derivative instruments and higher purchases, net of maturities and sales, of investment securities. See Note 2—Acquisitionsto our unaudited consolidated financial statements.
Reworded paragraphs (26)
Previous wording
Highlights for the first nine months of fiscal 2024. For the three and nine months ended June 30, 2024, net revenue increased 10% and 9% over the prior-year comparable periods, respectively, primarily due to the growth in nominal cross-border volume, processed transactions and nominal payments volume, partially offset by higher client incentives. During the three months ended June 30, 2024, exchange rate movements lowered our net revenue growth by approximately one percentage point. During the nine months ended June 30, 2024, exchange rate movements did not have a material impact on net revenue growth. See Results of Operations—Net Revenue below for further discussion.
Current wording
Highlights. For the three months ended December 31, 2024, net revenue increased 10% over the prior year, primarily due to the growth in processed transactions, nominal cross-border volume and nominal payments volume, partially offset by higher client incentives. For the three months ended December 31, 2024, exchange rate movements did not have a material impact on net revenue growth. See Results of Operations—Net Revenue below for further discussion.
Previous wording
For the three months ended June 30, 2024, GAAP operating expenses decreased 4% over the prior-year comparable period, primarily driven by lower litigation provision. For the nine months ended June 30, 2024, GAAP operating expenses increased 5% over the prior-year comparable period, primarily driven by higher personnel and general and administrative expenses, partially offset by lower litigation provision. See Results of Operations—Operating Expenses below for further discussion. During the three and nine months ended June 30, 2024, exchange rate movements did not have a material impact on our operating expenses growth.
Current wording
For the three months ended December 31, 2024, GAAP operating expenses increased 22% over the prior year, primarily driven by higher personnel and general and administrative expenses. See Results of Operations—Operating Expenses below for further discussion. For the three months ended December 31, 2024, exchange rate movements negatively impacted our operating expenses by approximately one percentage point.
Previous wording
For the three and nine months ended June 30, 2024, non-GAAP operating expenses increased 14% and 11% over the prior-year comparable periods, respectively, primarily driven by higher general and administrative, personnel and marketing expenses.
Current wording
For the three months ended December 31, 2024, non-GAAP operating expenses increased 11% over the prior year, primarily driven by higher personnel and general and administrative expenses.
Previous wording
Interchange multidistrict litigation. During the nine months ended June 30, 2024, we recorded additional accruals of $140 million to address claims associated with the interchange multidistrict litigation. See Note 13—Legal Matters to our unaudited consolidated financial statements.
Current wording
Interchange multidistrict litigation. For the three months ended December 31, 2024, we recorded an additional accrual of $27 million to address claims associated with the interchange multidistrict litigation. See Note 13—Legal Matters to our unaudited consolidated financial statements.
Previous wording
Common stock repurchases. During the nine months ended June 30, 2024, we repurchased 42 million shares of our class A common stock in the open market for $11.2 billion. As of June 30, 2024, our share repurchase program had remaining authorized funds of $18.9 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Current wording
Common stock repurchases. For the three months ended December 31, 2024, we repurchased 13 million shares of our class A common stock in the open market for $3.9 billion. As of December 31, 2024, our share repurchase program had remaining authorized funds of $9.1 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Previous wording
•Lease consolidation costs. During the nine months ended June 30, 2024, we recorded a charge within general and administrative expense associated with the consolidation of certain leased office spaces. We have excluded these amounts as they do not reflect the underlying performance of our business.
Current wording
•Lease consolidation costs. For the three months ended December 31, 2024, we recorded a charge within general and administrative expense associated with the consolidation of certain leased office spaces. We have excluded these amounts as it does not reflect the underlying performance of our business.
Previous wording
•Litigation provision. Litigation provision includes significant accruals related to certain legal matters that are not covered by the U.S. retrospective responsibility plan or the Europe retrospective responsibility plan (uncovered legal matters) and additional accruals associated with the interchange multidistrict litigation which are covered by the U.S. retrospective responsibility plan (U.S. covered litigation). Litigation provision associated with these matters can vary significantly based on the facts and circumstances related to each matter and do not correlate to the underlying performance of our business. During the three and nine months ended June 30, 2024 and 2023, we have excluded these amounts to facilitate a comparison to our past operating performance.
Current wording
•Litigation provision. Litigation provision includes significant accruals related to certain legal matters that are not covered by the U.S. retrospective responsibility plan or the Europe retrospective responsibility plan (uncovered legal matters) and additional accruals associated with the interchange multidistrict litigation which are covered by the U.S. retrospective responsibility plan (U.S. covered litigation). Litigation provision associated with these matters can vary significantly based on the facts and circumstances related to each matter and do not correlate to the underlying performance of our business. For the three months ended December 31, 2024, we have excluded this amount to facilitate a comparison to our past operating performance.
Previous wording
Under the U.S. retrospective responsibility plan, we recover the monetary liabilities related to the U.S. covered litigation through a downward adjustment to the rate at which shares of our class B-1 and class B-2 common stock ultimately convert into shares of class A common stock. During the three and nine months ended June 30, 2024, there were no conversion rate adjustments. During the three months ended June 30, 2023, basic and diluted earnings per class A common stock was unchanged and during the nine months ended June 30, 2023, basic and diluted earnings per class A common stock increased $0.01 and was unchanged, respectively, as a result of the downward adjustments of the class B-1 common stock conversion rate during the period. See Note 5—U.S. and Europe Retrospective Responsibility Plans and Note 13—Legal Matters to our unaudited consolidated financial statements.
Current wording
Under the U.S. retrospective responsibility plan, we recover the monetary liabilities related to the U.S. covered litigation through a downward adjustment to the rate at which shares of our class B-1 and class B-2 common stock ultimately convert into shares of class A common stock. For the three months ended December 31, 2024 and 2023, there was no conversion rate adjustment. See Note 5—U.S. and Europe Retrospective Responsibility Plans to our unaudited consolidated financial statements.
Previous wording
(1)Service revenue in a given quarter is primarily assessed based on nominal payments volume in the prior quarter. Therefore, service revenue reported for the three and nine months ended June 30, 2024 and 2023, respectively, was based on nominal payments volume reported by our financial institution clients for the three and nine months ended March 31, 2024 and 2023, respectively. On occasion, previously presented volume information may be updated. Prior period updates are not material.
Current wording
(1)Service revenue in a given quarter is primarily assessed based on nominal payments volume in the prior quarter. Therefore, service revenue reported for the three months ended December 31, 2024 and 2023, respectively, was based on nominal payments volume reported by our financial institution clients for the three months ended September 30, 2024 and 2023, respectively. On occasion, previously presented volume information may be updated. Prior period updates are not material.
Previous wording
Net revenue increased over the three and nine-month prior-year comparable periods primarily due to the growth in nominal cross-border volume, processed transactions and nominal payments volume, partially offset by higher client incentives.
Current wording
Net revenue increased over the three-month prior-year comparable period primarily due to the growth in processed transactions, nominal cross-border volume and nominal payments volume, partially offset by higher client incentives.
Previous wording
Our net revenue is impacted by the overall strengthening or weakening of the U.S. dollar as payments volume and related revenue denominated in local currencies are converted to U.S. dollars. During the three months ended June 30, 2024, exchange rate movements lowered our net revenue growth by approximately one percentage point. During the nine months ended June 30, 2024, exchange rate movements did not have a material impact on net revenue growth.
Current wording
Our net revenue is impacted by the overall strengthening or weakening of the U.S. dollar as payments volume and related revenue denominated in local currencies are converted to U.S. dollars. For the three months ended December 31, 2024, exchange rate movements did not have a material impact on net revenue growth.
Previous wording
•Service revenue increased primarily due to 7% and 8% growth in nominal payments volume over the three and nine-month prior-year comparable periods, respectively.
Current wording
•Service revenue increased over the three-month prior-year comparable period primarily due to 6% growth in nominal payments volume.
Previous wording
•Data processing revenue increased primarily due to 10% growth in processed transactions over the three and nine-month prior-year comparable periods.
Current wording
•Data processing revenue increased over the three-month prior-year comparable period primarily due to 11% growth in processed transactions.
Previous wording
•International transaction revenue increased primarily due to growth in nominal cross-border volumes of 12% and 15% over the three and nine-month prior-year comparable periods, respectively, excluding transactions within Europe, partially offset by lower volatility of a broad range of currencies.
Current wording
•International transaction revenue increased over the three-month prior-year comparable period primarily due to growth in nominal cross-border volumes of 15%, excluding transactions within Europe.
Previous wording
•Other revenue increased primarily due to growth in consulting and marketing services and select pricing modifications over the three and nine-month prior-year comparable periods.
Current wording
•Other revenue increased over the three-month prior-year comparable period primarily due to growth in consulting and marketing services and select pricing modifications.
Previous wording
•Client incentives increased primarily due to growth in payments volume over the three and nine-month prior-year comparable periods. The amount of client incentives we record in future periods will vary based on changes in performance expectations, actual client performance, amendments to existing contracts or the execution of new contracts.
Current wording
•Client incentives increased over the three-month prior-year comparable period primarily due to growth in payments volume. The amount of client incentives we record in future periods will vary based on changes in performance expectations, actual client performance, amendments to existing contracts or the execution of new contracts.
Previous wording
•Personnel expenses increased over the three and nine-month prior-year comparable periods primarily due to a higher number of employees and compensation, reflecting our strategy to invest in future growth, including acquisitions.
Current wording
•Personnel expenses increased over the three-month prior-year comparable period primarily due to severance costs in the current period to realign our organizational structure and a higher number of employees and compensation focused on areas that will drive higher long-term growth, including acquisitions.
Previous wording
•Depreciation and amortization increased over the three and nine-month prior-year comparable periods primarily due to additional depreciation and amortization from our on-going investments and acquisitions.
Current wording
•Depreciation and amortization increased over the three-month prior-year comparable period primarily due to additional amortization and depreciation from our on-going investments and acquisitions.
Previous wording
•General and administrative expenses increased over the three and nine-month prior-year comparable periods primarily due to a charitable contribution to the Visa Foundation in the current year, higher usage of travel related card benefits, higher indirect taxes and higher unfavorable foreign currency fluctuations, partially offset by the release of the reserve on indirect taxes previously recognized in fiscal 2021. The increase during the nine months ended June 30, 2024 also included lease consolidation costs in the current year.
Current wording
•General and administrative expenses increased over the three-month prior-year comparable period primarily due to unfavorable foreign currency fluctuations, lease consolidation costs in the current period and higher usage of travel related card benefits.
Previous wording
•Litigation provision decreased over the three and nine-month prior-year comparable periods primarily due to lower accruals related to the U.S. covered litigation. The decrease during the nine months ended June 30, 2024 was partially offset by accruals related to uncovered litigation in the current year. See Note 13—Legal Matters to our unaudited consolidated financial statements.
Current wording
•Litigation provision increased over the three-month prior-year comparable period primarily due to the accrual related to the U.S. covered litigation in the current period. See Note 13—Legal Matters to our unaudited consolidated financial statements.
Previous wording
•Investment income (expense) and other decreased during the three months ended June 30, 2024, primarily due to losses on our investments, partially offset by higher interest income on our cash and investments. Investment income (expense) and other increased during the nine months ended June 30, 2024, primarily due to higher interest income on our cash and investments and lower losses on our investments.
Current wording
•Investment income (expense) and other decreased over the three-month prior-year comparable period primarily due to losses on our equity investments and lower interest income on our cash and investments.
Previous wording
Operating activities. Cash provided by operating activities for the nine months ended June 30, 2024 was lower than the prior-year comparable period primarily due to higher incentive payments and higher cash paid for taxes due to the timing of payments, partially offset by continued growth in our underlying business.
Current wording
Operating activities. Cash provided by operating activities increased over the three-month prior-year comparable period primarily due to growth in our underlying business and the timing of payments related to income taxes.
Previous wording
Financing activities. Cash used in financing activities for the nine months ended June 30, 2024 was higher than the prior-year comparable period primarily due to higher share repurchases and higher dividends paid, partially offset by the absence of the principal debt payment upon maturity of our December 2022 senior notes. See Note 9—Stockholders’ Equityto our unaudited consolidated financial statements.
Current wording
Financing activities. Cash used in financing activities increased over the three-month prior-year comparable period primarily due to lower funds held on behalf of clients, higher share repurchases and higher dividends paid.
Previous wording
Common stock repurchases. During the nine months ended June 30, 2024, we repurchased shares of our class A common stock in the open market for $11.2 billion. As of June 30, 2024, our share repurchase program had remaining authorized funds of $18.9 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Current wording
Common stock repurchases. For the three months ended December 31, 2024, we repurchased shares of our class A common stock in the open market for $3.9 billion. As of December 31, 2024, our share repurchase program had remaining authorized funds of $9.1 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Previous wording
Dividends. During the nine months ended June 30, 2024, we declared and paid $3.2 billion in dividends to holders of our common and preferred stock. On July 23, 2024, our board declared a quarterly cash dividend of $0.52 per share of class A common stock (determined in the case of all other outstanding common and preferred stock on an as-converted basis). See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements. We expect to continue paying quarterly dividends in cash, subject to approval by the board.
Current wording
Dividends. For the three months ended December 31, 2024, we declared and paid $1.2 billion in dividends to holders of our common and preferred stock. On January 28, 2025, our board of directors declared a quarterly cash dividend of $0.59 per share of class A common stock (determined in the case of all other outstanding common and preferred stock on an as-converted basis). We expect to continue paying quarterly dividends in cash, subject to approval by the board of directors. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements.
Previous wording
Acquisition. On January 16, 2024, we acquired Pismo for a purchase consideration of $929 million. See Note 2—Acquisitions to our unaudited consolidated financial statements.
Current wording
Acquisition. In December 2024, we acquired Featurespace for a purchase consideration of $946 million. See Note 2—Acquisitions to our unaudited consolidated financial statements.