Visa Inc said that it expects revenue to accelerate past pre-pandemic levels, reassuring investors of a sustained recovery against the backdrop of challenging macroeconomic conditions and sending its shares 5% higher in extended trading. The forecast from the world’s largest payments processor followed an upbeat quarter fueled by a rebound in consumer spending as easing pandemic restrictions and falling cases encouraged more people globally to travel and shop. Runaway inflation, interest rate increases and the invasion of Ukraine are clouding the outlook for global growth this year.
Visa, which in March suspended its operations in Russia, warned of an about 4% hit to its revenue this year from the Ukraine conflict. Still, the payments giant said it was currently not seeing any material impact on cross-border travel in other parts of Europe as a result of the conflict. Cross-border volumes jumped 38% during the second quarter. And the total payment volumes rising 17%. The company reported net income of $3.6 billion, or $1.70 per share, above analysts’ average estimate. This is according to IBES data. Visa’s operating expenses, however, surged 11% to $2.4 billion as it spent more on employee compensation and marketing. Rival American Express had also reported a strong rebound in spending last week, while closest rival Mastercard Inc, whose shares were up 3% after the bell is set.