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US retail sales grew 1.2 percent in August, bouncing back after a dip in July. The growth was broad, with 12 out of 13 categories reporting higher spending as families finished back-to-school shopping.
This matters because Visa earns a small fee every time a consumer swipes a card or taps a phone. When retail spending is healthy, the total volume of money moving across Visa's digital rails grows without the company having to spend more to facilitate it.
Source: Bloomberg Markets and Finance
Visa and Circle participated in a $10 million investment for Velocity, a platform that helps banks and merchants process payments using stablecoins. Stablecoins are digital currencies designed to keep a steady value, usually tied to the US dollar. While the investment is small for a company of Visa's size, it shows the company is continuing to secure its place in the plumbing of digital currency. By backing the firms building this infrastructure, Visa ensures it remains the central network for money movement even as the technology behind that money changes.
Visa is working with Mastercard and Ant International to create a shared framework for verifying the agents who handle digital payments. This system, called Know Your Agent, helps different payment networks trust that the middlemen moving money across borders are legitimate and following safety rules.
By setting a common standard for these checks, Visa makes it easier for its network to connect with digital wallets and local payment systems in Asia. This is a smart move for the long term because it helps Visa capture more of the money moving between different types of digital apps, rather than just traditional card swipes.
Visa and the International Finance Corporation, a member of the World Bank Group, are launching a new program to reduce the risk for banks that want to expand digital payments in emerging markets. This risk-sharing initiative is designed to help local lenders provide more credit and digital tools to small businesses and individuals who currently rely on cash.
For Visa, this is a long-term move to grow its network in regions where most commerce is still handled with physical money. By helping local banks manage the risk of these new digital accounts, Visa can more quickly add millions of new users and merchants to its global payment rails, which earns it a small fee on every transaction they eventually make.
Source: Business Wire
Visa is expanding its data services to help lenders better understand the financial health of fintech companies that issue cards linked to stablecoins, which are digital currencies pegged to a steady asset like the US dollar. The number of these card programs on Visa's network has grown about 200 percent over the last year to more than 160.
This move helps Visa cement its role as the bridge between traditional banking and digital assets. By providing the data that lenders need to manage risk, Visa makes it easier for new digital payment firms to launch on its network, ensuring it remains the primary toll road for money movement even as the technology behind it changes.
Source: CNBC
Management has cleared its own profit targets for eight straight quarters, showing they have a tight grip on the business and set bars they know they can reach.
| Expectation | |
|---|---|
| EPS | $3.43 |
| Revenue | $12.08B |