00:00Good set of numbers. Modest beat on both top line and bottom line for the third quarter, fiscal third quarter
00:07for Visa.
00:08Adjusted EPS was about 2.7 percent ahead of estimates.
00:12But I think what was really notable is all the underlying trends were pretty resilient.
00:16So 18 percent volume gains, 34 percent services revenue gain.
00:22I think all of that puts Visa in a very comfortable spot to basically meet their raised full year 2026
00:30guidance, which they have raised to low end of mid teens for EPS growth.
00:35I think what I'd highlight is it really was firing on all, firing all engines.
00:41Value added services was $3.8 billion revenue in third quarter and Visa Direct, which is their consumer direct point
00:51to point money flows.
00:53Their transactions climbed 21 percent and new use cases and partnerships are kind of key tailwinds there.
00:59Sorry, one thing if I'd be remiss to not point out is the World Cup.
01:02It did it did really well for Visa's third quarter numbers and management cited very strong volume gains across all
01:11categories.
01:11So all the U.S. host cities, total card present spend accelerated.
01:16Transactions were up 20 percent.
01:19You have to understand, like when people are visiting and this is all cross-border spend, which is some of
01:24the most lucrative or higher margin business for the card network.
01:28Tap to pay transactions where people are going and using transit.
01:32So you just tap your card and move on your entertainment, your restaurant spend.
01:36All of that got a nice kicker.
01:38And the banks launched a lot of programs along as well to kind of bring in more consumers who were
01:43traveling for the World Cup.
01:44Diksha, this is a dumb question, but are those buy now pay later companies like Klarna competition for Visa?
01:51Are they friends or foes?
01:54So here's how I put it.
01:56Let's call it.
01:57When I was covering banks, I actually thought the card networks are done with just because of all the alternative
02:03payment rails that were coming direct fund, like bank to bank transfers were happening.
02:07And now BNPL is kind of growing.
02:09But if you pay attention, all the buy now pay later companies, and I cover the sector, their best selling
02:15product is actually a card.
02:18So the card networks have very beautifully managed to embed themselves into the buy now pay later ecosystem as well.
02:25So while you go to an Amazon.com and spend on, say, an Affirm there, Affirm is now giving you
02:32a card that you can go and swipe at a restaurant for your buy now pay later product.
02:38So I'm looking at these stocks, Diksha, Visa, MasterCard, Affirm.
02:43I mean, on a trailing 12-month basis, they're all kind of flattish.
02:46What's the story in the payment space here?
02:50I think the sector overall is beaten down overall.
02:54And I think if you just look at the card networks, they're somewhere in the middle of that range.
03:00The B2B processors are the worst hit.
03:02But I think there is the overall sector has kind of been doing poorly in that regard.
03:09That said, Visa and MasterCard are steady as they go.
03:12These are the most resilient, solid cash flow businesses along the sector that I cover.
03:21One thing, Paul, I would highlight, though, and we've been getting a lot of questions around that, is the 7
03:25% job cuts that Visa announced yesterday.
03:29And people are like, is that a distress signal?
03:31Like, what's going on?
03:32They're doing well.
03:33Then why are they kind of letting people go?
03:36I would highlight that that's not Visa in distress.
03:39I would read it as modern corporate portfolio management.
03:43Got it.
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