Harshita Rawat

Harshita Rawat inquired about the competitive environment in Europe and the U.S., as well as trends observed among low-income consumers.

Answer

CEO Sebastian Siemiatkowski expressed confidence in Klarna's competitive position due to its unparalleled global geographic coverage, which attracts large global merchants and partners like Stripe and Adyen. Regarding consumers, he described Klarna's users as 'self-aware avoiders' who are financially conscious, prefer zero-interest fixed installments over credit cards, and maintain better financial health, showing stable shopping and spending habits.

Harshita Rawat inquired about the competitive environment in Europe and the U.S., and separately, about the consumer landscape, specifically concerns regarding continued pressure on low-income consumers.

Answer

CEO Sebastian Siemiatkowski expressed strong confidence in Klarna's competitive position, citing its unparalleled geographic coverage as a global payment solution, which provides a strategic advantage in securing deals with large merchants and partners like Stripe and Adyen. Regarding consumers, he described Klarna's users as 'self-aware avoiders'—financially conscious individuals actively shying away from credit cards, borrowing less, and appreciating Klarna's zero-interest, fixed-installment products as a healthier alternative. He noted good performance and responsible borrowing among this customer base.

Harshita Rawat from Bernstein posed two questions: first, what factors would drive the pace of backbook conversion for Clover to reach the high end of its 10-15% volume growth range, and second, a follow-up on banking customer feedback regarding service and product levels after recent investments.

Answer

Paul Todd, CFO of Fiserv, explained that the 10% GPV growth represents the core organic rate, and reaching the high end of the 10-15% range would require a very significant and deliberate backbook conversion, ensuring a strong value proposition for merchants. Mike Lyons, CEO of Fiserv, stated that anecdotal feedback from banking clients is positive, but they are looking for sustained delivery on commitments, indicating that the company is in the early stages of a multi-quarter effort.

Harshita Rawat asked about the drivers for Clover's 10%-15% volume growth, specifically what pace of backbook conversion could lead to the high end of the range, and sought an update on banking customers' feedback regarding service and product improvements.

Answer

CEO Mike Lyons explained that the 10% Clover GPV growth represents the core organic rate, with the higher end (15%) requiring significant, deliberate backbook conversion with clear value propositions. On banking, he stated that clients appreciate the investments and changes but are looking for sustained delivery on commitments.

Harshita Rawat questioned the viability of turning around the branded business amidst intensified competition and e-commerce aggregation, asking about the impact of upstream presentment on transaction margin dollars due to potential price-based competition, and if PayPal can grow earnings without branded improvement.

Answer

Jamie Miller, Executive VP and CFO, acknowledged that investments in branded checkout are multi-year and critical for competitiveness, potentially impacting transaction margin dollars. However, she highlighted PayPal's diversified growth drivers (Venmo, PSP, debit, credit) which enabled solid transaction margin dollar growth and mid-teens EPS growth in 2025, even with low-to-mid single-digit branded growth, demonstrating multiple paths to win.

Harshita Rawat questioned if the branded business can be turned around given intensified competition and e-commerce aggregation, asking if transaction margin dollars in branded will decrease due to focus on upstream presentment and price-based competition, and if PayPal can grow earnings without branded improvement.

Answer

Jamie Miller (Executive VP and CFO, PayPal) stated that investments in merchant co-investment and product will be consistent for several years to remain competitive. She highlighted PayPal's diversified revenue and margin growth sources (Venmo, PSP, debit, credit), which allowed for solid transaction margin dollar growth and mid-teens EPS growth in 2025 even with a low-to-mid single-digit branded checkout profile, demonstrating multiple ways to win.

Harshita Rawat inquired about the branded business's 5% growth, noting headwinds and expected Q4 deceleration, while also considering the potential benefit from Buy Now, Pay Later and Venmo promotions during the holiday season. She asked for clarity on the overall path to branded acceleration and whether to focus on diversified growth drivers.

Answer

CFO Jamie Miller explained that branded checkout has seen consistent mid-single-digit growth, with strong momentum in BNPL and Pay with Venmo. She noted macro-related deceleration in September, particularly in Europe and the U.S., with consistent transaction numbers but decreased basket sizes. Jamie Miller stated that Q4 guidance assumes a lower growth rate due to macro trends but expressed confidence in scaling initiatives internationally, building on U.S. progress.

Harshita Rawat (Sanford C. Bernstein & Co., LLC) questioned the trajectory of branded TPV growth, noting headwinds and Q4 deceleration, while also considering the positive impact of Pay with Venmo and Buy Now, Pay Later promotions. She sought clarity on the overall path to branded acceleration relative to Investor Day targets and the emphasis on diversified growth drivers.

Answer

CFO Jamie Miller acknowledged consistent mid-single-digit branded checkout growth, with strong momentum from Buy Now, Pay Later and Pay with Venmo, and higher U.S. growth year-to-date. She attributed Q4 deceleration to macro-related factors in September and October, including reduced basket sizes, and stated that 2027 targets assumed a consistent macro environment. Miller expressed confidence in scaling successful U.S. initiatives internationally.

Harshita Rawat of AB Bernstein followed up on the PayPal World announcement, asking what makes this attempt at wallet interoperability different from past efforts, given historical challenges with user experience and awareness.

Answer

President, CEO & Director Alex Chriss emphasized that the platform is designed for a simplified, native user experience. He explained that users can click the PayPal button and check out with their home wallet (e.g., UPI) without new merchant integrations. He also stressed that there is a strong CEO-to-CEO commitment among the partner wallets to ensure a frictionless, delightful experience for consumers globally.

Harshita Rawat sought clarification on whether the previously mentioned 100 basis point conversion uplift from the new checkout experience is holding steady and asked about the potential speed of the rollout in Europe.

Answer

CFO and COO Jamie Miller confirmed that the 100 basis point conversion uplift is holding as the new checkout is rolled out. She added that the rollout in Europe is expected to be much faster and easier because a higher proportion of European merchants are already on PayPal's latest integration platform.

Harshita Rawat inquired about the progress of conversations with large merchants for Fastlane adoption post-holiday season and the strategy for converting new or dormant Fastlane users into active PayPal users.

Answer

CEO Alex Chriss stated that go-to-market efforts for Fastlane are focused on large enterprise merchants like NBCUniversal and Roku, with implementations now underway in 2025. He explained that the 75% of Fastlane users who are new or dormant represent an opportunity to re-engage them through targeted marketing, reminding them of the full value of the branded PayPal experience.

Harshita Rawat asked for an update on Fastlane's momentum, specifically the feedback from larger merchants and the dynamic between the Fastlane guest experience and the traditional branded checkout.

Answer

CEO Alex Chriss clarified that over 1,000 merchants, mostly SMBs, are now on Fastlane. He noted that large enterprises are providing very exciting feedback and plan to ramp up testing in Q1, after the holiday code freeze and once the multi-processor strategy is fully enabled. He explained that Fastlane serves as a funnel, capturing users who bypass the branded mark and allowing PayPal to market the value of the full branded experience to them, creating a flywheel for growth in 2025.

Harshita Rawat of AB Bernstein inquired about the impact of the proliferation of Visa tokens (over 17 billion, 3x physical cards) on conversations with issuer customers, merchants, and merchant acquirers. She asked if the benefits of tokens, such as improved authorization rates, fraud reduction, and enabling agentic capabilities, are shifting discussions from network fees to the value of lending and creating opportunities for value-based pricing.

Answer

Ryan McInerney, Visa's Chief Executive Officer, highlighted the multi-year journey to achieve 17.5 billion tokens and over 50% tokenized transactions. He explained that the dialogue with merchants and acquirers is positive, driven by the demonstrated sales uplift and significant fraud reduction benefits of tokenization. Visa continues to focus on converting stored credentials to tokens, reducing guest checkout (currently 16% of e-commerce transactions), and expanding token solutions to new markets like Europe, CEMEA, and Latin America.

Harshita Rawat asked about the implications of the proliferation of Visa tokens (over 17 billion) and their benefits (authorization rates, fraud reduction, agentic capabilities) on conversations with issuer customers, merchants, and merchant acquirers, particularly regarding network fees versus value and potential pricing opportunities.

Answer

Ryan McInerney, Visa's Chief Executive Officer, highlighted the multi-year journey to achieve current tokenization levels. He explained that dialogues with merchants and acquirers focus on the sales uplift and fraud reduction benefits of tokenization, which are significant 'aha moments' for retailers. With issuers, the focus is on embedding tokenization into their tech stacks. Visa continues to work on converting stored credentials to tokens, reducing guest checkout, and expanding tokenization to new markets like Europe, CEMEA, and Latin America.

Harshita Rawat inquired about the most tangible areas of opportunity for Visa related to stablecoins in the coming years, spanning cards, Value-Added Services (VAS), and new payment flows.

Answer

Ryan McInerney, Visa's Chief Executive Officer, identified significant opportunities in stablecoin issuance, modernizing Visa's settlement network, leveraging the Pismo platform, enhancing cross-border money movement (including the Visa Direct pre-funding pilot), and enabling banks to mint and burn stablecoins via the Visa Tokenized Asset Platform. He emphasized that stablecoins offer product-market fit in emerging markets and cross-border money movement, areas where Visa is currently underpenetrated.

Harshita Rawat inquired about the most tangible opportunities for Visa related to stablecoins in the coming years, specifically across cards, Value-Added Services (VAS), and new money movement flows, following the passage of the Genius Act.

Answer

CEO Ryan McInerney identified significant stablecoin opportunities in issuance, modernizing settlement networks, leveraging the Pismo platform, enhancing cross-border money movement (including Visa Direct pre-funding), and consulting. He highlighted stablecoins' strong product-market fit in emerging markets and underpenetrated total addressable markets.

Harshita Rawat of AB Bernstein asked for more detail on the Q4 guidance, questioning the drivers behind the expected revenue deceleration from Q3.

Answer

CFO Chris Suh explained that Q4 is fundamentally strong but faces difficult comparisons to the prior year, which had unusually low incentive growth and strong Value-Added Services revenue. He noted the primary differences from Q3 are assumptions for lower currency volatility and the absence of Q3's one-time incentive benefits, while Q4 laps prior-year benefits.

Harshita Rawat of AB Bernstein asked for more detail on the Q4 guidance, seeking to understand the drivers of the expected revenue deceleration from Q3, particularly regarding FX volatility and client incentives.

Answer

CFO Chris Suh explained that Q4 is expected to be fundamentally strong but is impacted by lapping a prior year's Q4 that had one-time benefits, including lower incentive growth. He noted the key differences from Q3 are lower currency volatility expected in Q4 compared to the high levels in Q3, and the timing of one-time incentive adjustments that benefited Q3.

Harshita Rawat of AB Bernstein asked for more detail on the Q4 guidance, seeking to understand the drivers behind the expected deceleration from Q3's strong performance, particularly regarding FX volatility and client incentives.

Answer

CFO Chris Suh explained that Q4 is expected to be fundamentally strong but is impacted by lapping difficult comparisons from the prior year, specifically a quarter with very low incentive growth and a strong Value-Added Services (VAS) period. He noted the key differences versus Q3 are lower currency volatility assumptions and the absence of one-time incentive benefits that occurred in Q3, while Q4 anniversaries prior-year benefits.

Harshita Rawat of Bernstein asked how Visa, as a U.S.-based company, is navigating the risks of government nationalism in the current global environment.

Answer

CEO Ryan McInerney stated that nationalism is not a new challenge and that Visa has a proven track record of success in highly regulated markets. He highlighted the company's world-class government engagement teams and tailored local strategies, which involve working closely with clients, partners, and regulators to educate them on the benefits of the global payments ecosystem.

Harshita Rawat followed up on the 'unbundling' of capabilities to ask specifically about Visa's account-to-account (A2A) strategy, inquiring about the roadmap for use cases, monetization models, and potential for debit card cannibalization.

Answer

Ryan McInerney, Chief Executive Officer, confirmed that Visa A2A is a prime example of unbundling its brand, rules, and risk management. The initial launch is on track for early 2025 in the U.K., targeting Bill Pay. He also highlighted the success of Visa's A2A Protect service, which provides fraud scoring for RTP networks like Pix in Brazil, driven by strong client demand for security.

Harshita Rawat inquired about Visa's perspective on the U.S. regulatory and litigation environment, including the DOJ lawsuit and Reg II, and asked for the company's revenue exposure to U.S. debit.

Answer

Ryan McInerney, CEO, stated that Visa is confident in its ability to manage regulatory complexity and compete effectively. However, he noted that the company does not disclose specific revenue exposure for segments like U.S. debit.

Harshita Rawat asked for a framework on Mastercard's Agentic Commerce capabilities, including the identity trust layer and custom AI agents, given market fragmentation and competing protocols. She also questioned why Mastercard believes it will thrive in this era regarding trust, governance, and personalization.

Answer

Michael Miebach (CEO) expressed excitement for Agentic Commerce, anticipating its rapid scaling. He highlighted Mastercard's AgentPay framework for agent recognition, identity assurance, and integrating payment protections. He emphasized the value of the cards ecosystem, new relationships, and differentiated solutions (services, transaction opportunities, tokenization) as key factors for Mastercard to thrive, despite fragmentation, by focusing on consumer protection, safety, and security.

Harshita Rawat from Bernstein asked for an overview of Mastercard's Agentic Commerce announcements, including the Agent Suite, framing its capabilities like identity trust and custom AI agents amidst market fragmentation and competing protocols. She also questioned why Mastercard is positioned to thrive in this era, emphasizing trust, governance, and personalization.

Answer

Michael Miebach, CEO of Mastercard, highlighted Agentic Commerce as a fast-evolving, AI-driven use case that resonates with consumers for better commerce journeys. He emphasized Mastercard's AgentPay framework, launched over eight months prior, for recognizing agents, ensuring identity, and integrating payment protections. He expressed confidence in Mastercard's ability to set standards, build new relationships, and leverage its differentiated services and transaction opportunities, including tokenization, in this space.

Harshita Rawat inquired about the Mastercard Commerce Media announcement, its integration of assets (offers, loyalty, personalization), early feedback from advertisers, distribution channels, and the sustainability of high return on ad spend.

Answer

CEO Michael Miebach explained that Mastercard Commerce Media leverages proprietary spend data and insights from 500 million permissioned consumers and 25,000 merchants to enable attributable ad spend, a unique differentiator. He noted strong initial interest from advertisers and publishers, seeing it as a significant new business opportunity beyond payment transactions, building on Mastercard's long history in loyalty.

Harshita Rawat inquired about the Mastercard Commerce Media announcement, how it integrates existing assets (offers, loyalty, personalization), early feedback from advertisers, distribution channels, and the sustainability of its high return on ad spend.

Answer

CEO Michael Miebach described Mastercard Commerce Media as a significant development leveraging proprietary spend data and insights from 500 million permissioned consumers and 25,000 merchants. He highlighted its unique ability to attribute ad spend to specific transactions, addressing a key advertiser problem. Initial reception from advertisers and publishers is positive due to the clear proposition, though it's still early days for sharing specific numbers.

Harshita Rawat inquired about Mastercard's strategy and momentum in capturing the large international commercial point-of-sale (POS) opportunity, where card penetration remains low.

Answer

CEO Michael Miebach characterized commercial POS as a significant short-to-medium-term opportunity. He outlined a strategy focused on building relationships with issuers and SME-focused marketplaces, leveraging differentiated products like their fleet card solution. He noted that Mastercard has established specialized SME teams globally to execute on the ambitious growth targets for this segment.

Harshita Rawat inquired about the composition of Mastercard's cross-border business, seeking clarity on the mix between travel and e-commerce, and specifically on U.S. inbound trends.

Answer

CFO Sachin Mehra explained that the cross-border portfolio is highly diversified, with no single corridor pair representing more than 3% of total volume in 2024. He referenced past disclosures suggesting a roughly even split between card-present and card-not-present transactions, with travel being a component of the latter. Mehra noted that this general mix remains stable and that card-not-present (ex-travel) continues to show very strong growth.

Harshita Rawat asked about Mastercard's progress with stablecoins in cross-border money movement and its overall strategic positioning for growth in the crypto ecosystem.

Answer

CEO Michael Miebach confirmed that Mastercard has moved beyond proofs-of-concept into live stablecoin transactions and sees B2B cross-border payments as a significant upside opportunity. He highlighted the live Multi-Token Network (MTN) and key partnerships with firms like JPMorgan, emphasizing that Mastercard is well-prepared to support the ecosystem's growth through its focus on interoperability and governance.

Harshita Rawat from AllianceBernstein inquired about Mastercard's cybersecurity services, asking how they are sold and whether they function as an add-on to transactions or a distinct business line.

Answer

Chief Executive Officer Michael Miebach clarified that cybersecurity is a significant part of Value-Added Services, with solutions sold both with and without a direct link to a transaction. He noted that about half of these services are not transaction-related, highlighting the recent agreement to acquire Recorded Future as a move to add subscription-based threat intelligence and expand the addressable market.

Harshita Rawat followed up on the Financial Solutions business, questioning how conditions could change so dramatically in two months within a recurring segment, especially after the full-year guidance was trimmed just three months prior. She also asked why there wasn't more visibility into this level of intra-quarter revenue weakness.

Answer

CEO Mike Lyons acknowledged the unexpected reset, explaining that the July recalibration focused on major projects. Subsequent financial surprises in Q3 prompted a more rigorous review, which uncovered additional assumptions (macro, industry, broad-based productivity, record sales, stretch revenue numbers) that were difficult to achieve simultaneously. He also cited the deprioritization of short-term initiatives that were a significant part of the original guidance for the back half of the year. Lyons expressed confidence in the current baseline after the comprehensive review and leadership changes. CFO Paul Todd added that the first half 2025 growth rates (7-8%) for Financial Solutions were higher than typical, and the current lower single-digit range is more normalized, expecting similar dynamics in H1 2026 before normalizing in H2 2026 and 2027.

Harshita Rawat from Bernstein questioned the dramatic and unexpected revenue weakness in the Financial Solutions business during Q3, especially given the full-year guide trim just one month into the quarter and the segment's recurring nature, seeking clarity on the lack of intra-quarter visibility.

Answer

CEO Mike Lyons acknowledged the unexpected reset, explaining that while initial Q2 recalibrations focused on major projects, subsequent financial surprises in Q3 prompted a deeper, more rigorous review. This uncovered additional optimistic assumptions and short-term initiatives that needed revisiting, leading to the current baseline. CFO Paul Todd added that the first half's higher growth rates for Financial Solutions were atypical, and the current lower single-digit range is more normalized.

Harshita Rawat from Sanford C. Bernstein & Co., LLC followed up on merchant operating margins, asking for a quantification of the drivers behind the recent performance and whether the Q2 result was in line with prior expectations.

Answer

CFO Robert Hau explained that the full-year adjusted operating margin guidance was revised from at least 125 bps to approximately 100 bps of expansion. This change was driven by the margin impact of four recent acquisitions, which have below-company-average margins, and the revised 10% organic growth outlook providing less operating leverage. He stated that the Q2 merchant margin was generally in line with internal expectations, reflecting these acquisitions and intentional investments in growth.

Harshita Rawat of Sanford C. Bernstein & Co., LLC followed up on merchant operating margins, asking for a quantification of the drivers behind the decline and the expected cadence going forward, and whether the Q2 margin was in line with prior expectations.

Answer

Robert Hau, CFO, explained that the full-year operating margin guidance was revised down to approximately 100 basis points of expansion due to the impact of four recent acquisitions with below-average margins and a lower organic growth forecast. He stated that the Q2 merchant margin was generally in line with internal expectations, reflecting intentional investments in marketing, distribution, and new product development.

Harshita Rawat asked about January business trends and requested an explanation for the deceleration in Clover's GPV growth, particularly given accelerating U.S. volume data from networks.

Answer

CFO Bob Hau stated that January trends were in line with expectations and the consumer remains resilient. He clarified that the reported Clover GPV growth rate was impacted by tough comparisons from the unique inflation and interest rate dynamics in Argentina in 2024, as the reported volume is not adjusted for such factors or for FX movements.

Harshita Rawat questioned the competitive positioning of the STAR and Accel debit networks, particularly regarding their signature and dual-messaging capabilities in the evolving U.S. payments landscape.

Answer

Chairman, President and CEO Frank Bisignano stated that STAR and Accel are strategic assets that allow Fiserv to compete for transactions for its clients' benefit. He confirmed the networks have strong PIN, signature, and dual-messaging capabilities, giving merchants and issuers choices. He expects steady volume share gains rather than a meteoric rise.

Harshita Rawat inquired about Toast's new AI-powered assistant (Toast IQ), asking about feedback from pilot customers, the value it provides, and its key points of differentiation in the market.

Answer

CEO Aman Narang reported that customer feedback on the AI product has been very positive, with users valuing the ability to get insights, recommendations, and take action through a human-like interface. He stated the goal is to build the best GPT-like tool for restaurants by leveraging Toast's unique data, with plans for general availability later in the year.

Harshita Rawat asked about the financial impact of hardware tariffs, the company's ability to mitigate these costs, and the potential to pass them on to customers. She also requested a breakdown of the location growth algorithm.

Answer

CFO Elena Gomez stated that incremental tariff costs are manageable and already factored into guidance, thanks to proactive supply chain diversification away from China. She noted they will be thoughtful about any potential price adjustments. Regarding location growth, she explained it's a balanced mix of new and existing restaurants, with the core segment as the primary driver and new verticals expected to contribute more over time.

Harshita Rawat inquired about market share gains in the core U.S. restaurant segment, specifically the performance of flywheel markets, and asked if Toast was rethinking its international distribution strategy.

Answer

CEO Aman Narang stated that the bulk of record net adds came from the core SMB business, with flywheel markets continuing to outperform the company average. Regarding international strategy, he said the current focus is replicating the successful U.S. direct sales model in initial markets, though other models like resellers could be considered for future expansion based on market-specific factors.

Asked about customer growth trends in March and April and the company's exposure to discretionary spending. Also inquired about the progress of the U.S. sales pipeline following increased hiring.

Answer

The executive reported no significant changes in business trends in March and April, aside from currency effects. The U.S. sales ramp-up is progressing well, with new customer cohorts developing as expected, contributing to North America's position as a fast-growing region.

Asked for details on Cash App Pay volumes and strategy for e-commerce penetration, and also inquired about compliance investments within Cash App as it expands its banking services.

Answer

Amrita Ahuja reported that Cash App Pay has reached 3 million monthly actives and $2.5B in annualized GPV, driven by partnerships with DoorDash, Adyen, and Stripe. Jack Dorsey addressed compliance, stating it is a significant and constant area of investment to build trust, especially for their banking ambitions, and that new technologies are making these efforts more efficient.