* Sees 3rd-qtr revenue growth in "mid-single digits" in
* Second-quarter adjusted profit $2.20/Class A share
* Operating revenue growth hurt by strong dollar
* Shares down 5 pct after the bell
(Adds executive comments from conference call; updates shares)
By Aman Shah
April 24 Visa Inc, the world's largest
credit and debit card company, said U.S. sanctions on Russia
were hurting its card transaction volumes and that revenue
growth would slow further this quarter, sending its shares down
5 percent after the bell.
Visa's quarterly revenue growth slid to a single digit in
percentage terms for the first time in more than four years, due
to a strong U.S. dollar.
The company and rival MasterCard Inc stopped
providing services to two Russian banks after U.S. President
Barack Obama imposed sanctions on Russia in March after a
standoff over Ukraine.
"We are caught between the politics of the United States and
the politics of Russia," Chief Financial Officer Byron Pollitt
said on a post-earnings conference call on Thursday.
"We're clearly seeing a drop-off in cross-border volume and
sanctions are expected to have some impact on volume."
Uncertainty over the companies' operations in Russia lingers
as Russian President Vladimir Putin has said the country would
develop its own credit card system to reduce dependence on
Visa said it would assess the situation in Russia and was
hopeful it would still have a "meaningful opportunity" to
continue to do business there.
"We have 100 million cards there (in Russia) and it is not
in anyone's best interest, inclusive of the Russians, to make
those cards not available to their own citizens," Pollitt said.
SLOWING REVENUE GROWTH
Visa said strength in the U.S. dollar was likely to slow its
revenue growth further this quarter to "mid-single digits" in
The company's revenue growth slowed to 7 percent in the
second quarter ended March 31 from 11 percent in the first
Chief Executive Charlie Scharf said the impact of the strong
dollar would be "slightly more pronounced" this quarter before
rebounding in the following three months.
Net income attributable to Visa rose 26 percent from a year
earlier to $1.60 billion, or $2.52 per Class A share, in the
Visa earned $2.20 per share, excluding a tax benefit of $218
million in the quarter.
Total operating revenue increased to $3.16 billion from
Analysts on average had expected a profit of $2.18 per share
on revenue of $3.19 billion, according to Thomson Reuters
Visa said it expected full-year revenue to grow 10-11
percent. The company had earlier said its revenue was expected
to grow in low double digits in percentage terms.
The Foster City, California-based company maintained its
earnings forecast, but said the guidance assumed "several
pennies of earnings per share impact" from the situation in
In March, Visa and MasterCard launched a cross-industry
group to push for improved security in card transactions and
press U.S. retailers and banks to meet a 2015 deadline to adopt
the safer EMV technology.
EMV cards, already used in Europe and Asia, store
information on computer chips rather than on traditional
magnetic strips, making them harder to counterfeit.
Shares of Visa, which has a market value of about $133
billion, closed at $209.40 on the New York Stock Exchange on
The stock has risen 13 percent since it was included in the
Dow Jones Industrial Average in September.
(Editing by Savio D'Souza and Kirti Pandey)