In this news, we discuss the Visa profit falls 23% as payment volumes plunge.
(Reuters) – Visa Inc VN missed Wall Street estimates for fourth-quarter earnings on Wednesday as high unemployment due to the coronavirus-induced recession continues to weigh on consumer spending.
The payment processor said total spend fell 10% in constant dollars and the number of transactions processed fell 13% from the previous year.
Cross-border volume fell 47% as the global pandemic continues to hamper demand for travel.
Earlier on Wednesday, Mastercard Inc MA.N missed earnings expectations and warned that travel-related spending would likely be a major headwind for the industry until COVID-19 vaccines become widely available.
Visa’s net income fell to $ 2.4 billion, or $ 1.07 per Class A share, for the fourth quarter ended Sept. 30, from $ 3.03 billion, or $ 1.34 per share Category A, one year earlier. On an adjusted basis, the company reported earnings of $ 1.06 per share.
Net incomes fell 17% to $ 4.8 billion as consumer spending was constrained due to the health crisis, which triggered the worst economic downturn in decades and led to mass layoffs.
This is only the second time that the company’s quarterly revenue has declined year-over-year since its IPO in 2008.
Analysts polled by Refinitiv had expected revenues to drop 18.5% and earnings to $ 1.09 per share.
Reporting by Imani Moise; Edited by Leslie Adler and Jonathan Oatis
Original © Thomson Reuters