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VI

VISA INC. (V)·Q4 2025 Earnings Summary

Executive Summary

  • Q4 FY2025 net revenue grew 12% to $10.724B, with non-GAAP EPS up 10% to $2.98; GAAP EPS declined 1% due to a $899M litigation provision tied to interchange MDL and other legal matters .
  • Results modestly beat Wall Street: revenue $10.724B vs $10.618B consensus*, and non-GAAP EPS $2.98 vs $2.972*; beats were driven by stronger value-added services, commercial solutions, and FX tailwind .
  • Management raised the quarterly dividend 14% to $0.670 per share and reiterated capital returns (Q4 buybacks ~$4.9B; $24.9B authorization remaining) .
  • FY2026 guidance implies low double-digit adjusted net revenue and EPS growth with low double-digit OpEx growth; Q1 expected at the high end of low double-digit revenue growth, highlighting pricing timing and continued resilience .
  • Strategic catalysts: accelerating value-added services (+25% to ~$3B), expanding tokenization (16B tokens), agentic commerce leadership, and stablecoin pilots (settlement and payouts), supporting multi-year growth narratives .

Note: *Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well

  • Net revenue growth outpaced volume drivers: 12% net revenue vs 9% payments volume and 11% cross-border ex intra-Europe; data processing +17% on pricing and mix, other revenue +21% on advisory/VAS .
  • Value-added services accelerated 25% to ~$3B, led by issuing solutions, advisory and card benefits; CMS revenue +14% constant dollars with commercial payments volume +10% .
  • Strategic progress: 16B tokens; agentic commerce standards (Visa Intelligent Commerce, Trusted Agent Protocol); Visa-as-a-Service stack scaling to 700B API calls; selective stablecoin pilots expanding settlement and payouts .
    Quote: “We are now powering live agentic transactions…Visa Trusted Agent Protocol…built on existing messaging standards…easy for merchants to integrate” .

What Went Wrong

  • GAAP OpEx +40% YoY and GAAP EPS −1% YoY, driven by the $899M litigation provision; GAAP net income −4% YoY despite strong revenue, highlighting legal headwinds .
  • International transaction revenue +10% lagged 11% cross-border ex intra-Europe growth on mix (e.g., Canada→U.S. corridor) and hedging offsetting FX benefits .
  • Latin America growth moderated sequentially (Argentina disinflation), and elevated OpEx reflected FX and deferred compensation mark-to-market (EPS-neutral but pressured OpEx) .

Financial Results

Headline P&L vs prior quarters

MetricQ2 2025Q3 2025Q4 2025
Net revenue ($USD Billions)$9.594 $10.172 $10.724
GAAP Net Income ($USD Billions)$4.577 $5.272 $5.090
GAAP Diluted EPS ($)$2.32 $2.69 $2.62
Non-GAAP Net Income ($USD Billions)$5.442 $5.834 $5.803
Non-GAAP Diluted EPS ($)$2.76 $2.98 $2.98

Revenue components

Revenue Component ($USD Billions)Q2 2025Q3 2025Q4 2025
Service revenue$4.399 $4.330 $4.602
Data processing revenue$4.701 $5.153 $5.394
International transaction revenue$3.291 $3.633 $3.800
Other revenue$0.937 $1.028 $1.176
Client incentives$(3.734) $(3.972) $(4.248)
Net revenue$9.594 $10.172 $10.724

KPIs

KPIQ2 2025Q3 2025Q4 2025
Payments volume YoY (constant)8% 8% 9%
Cross-border volume ex intra-Europe YoY (constant)13% 11% 11%
Cross-border volume total YoY (constant)13% 12% 12%
Processed transactions (billions)60.7 65.4 67.7

Results vs Estimates (Q4 2025)

MetricConsensusActual
Revenue ($USD Billions)$10.618*$10.724
Primary EPS ($)$2.972*$2.98
# of EPS estimates29*—
# of Revenue estimates27*—
Target Price (consensus, $)$394.43*$394.43*

Note: *Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted net revenue growthFY2026n/aLow double digits New
Nominal net revenue growthFY2026n/a~Consistent with FY2025 (~11%) with ~0.5 pt FX benefit New
Adjusted EPS growthFY2026n/aLow double digits New
Adjusted operating expense growthFY2026n/aLow double digits; Q2–Q3 higher due to Olympics/FIFA marketing New
Non-operating expenseFY2026n/a$125–$175M New
Non-GAAP tax rateFY2026Long-term 19–20%18.5–19% (below LT due to absence of one-off benefits in 2026) Update
Q1 adjusted net revenue growthQ1 FY2026n/aHigh end of low double digits New
Q1 adjusted OpEx growthQ1 FY2026n/aLow double digits New
Q1 non-operating expenseQ1 FY2026n/a~$15M New
Q1 tax rateQ1 FY2026n/a~18% New
Client incentives cadenceFY2026n/aGrowth similar to FY2025; Q3 toughest comp; ~20% PV impacted by renewals New
Dividend per shareQ4 FY2025$0.590 (Q3) $0.670 (declared Oct 28, 2025; payable Dec 1, 2025) Raised 14%

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q4)Trend
AI/agentic commerceProduct drop and early sandbox pilots; standards work underway Live agentic transactions; Trusted Agent Protocol launched; open, easy to integrate Accelerating deployment
StablecoinsSupport for regulatory clarity; pilots on settlement and remittances corridors Expanded settlement coins/chains; pre-funding pilot; new stablecoin payout pilot via Visa Direct Broadening use cases
Data processing pricing/mixBack-half pricing timing; yield lift vs transactions +17% revenue vs +10% transactions; higher cross-border mix aiding yields Sustained yield advantage
Cross-border e-com/travelAbove pre-COVID trend; June softness; corridor/mix effects (Canada→U.S.) E-com +13%; travel ~10%; ~40% e-com share of cross-border; mix and hedging moderated revenue Stable, with mix nuances
Regional trendsAPAC improvement (~2.5pts); LAC moderated (Argentina) APAC momentum sustained; LAC growth slower on inflation moderation Mixed by region
OpEx/marketingBack-half pricing; higher renewals; Q4 incentives peak FY2026 OpEx low double digits; Q2–Q3 elevated for Olympics/FIFA Investment cadence rising in events

Management Commentary

  • “Fiscal fourth quarter net revenue grew 12% year over year to $10.7 billion, and EPS was up 10%…Visa has become a hyperscaler…build on top of the Visa-as-a-Service stack” .
  • “Over half of the new [VisaNet] codebase was built with the assistance of generative AI…enabling easier scaling, configuration, and faster feature deployment” .
  • “We now have over 16 billion Visa tokens…goal of 100% of e-commerce transactions tokenized” .
  • “Value-added services revenue grew 25%…to $3 billion, driven by issuing solutions, advisory and other services, and pricing” .
  • “In Q4, we bought back approximately $4.9 billion in stock…$24.9 billion remaining in our buyback authorization” .
  • “In 2026, we expect full year adjusted net revenue growth to be in the low double digits…adjusted operating expense…low double digits” .

Q&A Highlights

  • Macro/spend resilience: Diversified exposure across credit/debit and spend bands; higher-spend cohorts driving growth; assumption of stable macro into FY2026 .
  • Agentic commerce adoption: Standards via Visa Intelligent Commerce and Trusted Agent Protocol; near-term integration into shopping journeys; long-term autonomous purchasing potential .
  • Cross-border yield/mix: International transaction growth lagged volume on mix (e.g., Canada→U.S.) and hedging; e-commerce remains ~40% of cross-border and growing faster than travel .
  • Latin America moderation: Sequential slowdown tied to Argentina disinflation; region remains high-growth overall .
  • FY2026 non-op/tax: Non-op expense $125–$175M; tax rate 18.5–19% (still below long-term) .

Estimates Context

  • Revenue and EPS beat: Actual revenue $10.724B vs $10.618B consensus*, and EPS $2.98 vs $2.972*; momentum was driven by value-added services, commercial solutions, and FX .
  • Estimate implications: Strength in VAS and CMS likely supports upward revisions to FY2026 VAS/CMS contributions; OpEx guidance and event spend may temper aggregate margin expectations near-term .

Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

  • Modest top-line and EPS beat vs consensus, with VAS (+25%) and CMS strength offsetting mix/hedging headwinds in international transaction revenue .
  • Litigation provision ($899M) depressed GAAP EPS; non-GAAP results better reflect underlying drivers; monitor ongoing MDL-related provisions .
  • FY2026 setup: Low double-digit adjusted revenue/EPS growth, continued pricing contribution, and event-driven OpEx cadence; Q1 positioned as strongest YoY growth quarter .
  • Strategic moat expanding via tokenization (16B tokens), agentic standards, and stablecoin pilots (settlement and payouts) that can unlock underpenetrated TAMs (emerging markets, cross-border) .
  • Cross-border remains above pre-COVID trend; e-commerce’s 40% share and faster growth support durable international yields, albeit with corridor/mix variability .
  • Capital returns intact: Dividend raised to $0.670; buybacks ~$4.9B in Q4 with $24.9B authorization remaining—supportive of EPS growth .
  • Watch list: Incentive growth vs renewals (~20% PV impacted), FX/volatility normalization, and Latin America moderation; these are the main swing factors for quarterly cadence .