NEW YORK (AP) — Payment processing giant Visa Inc. said Tuesday that its fiscal third-quarter profits rose 9% on an adjusted basis, as it benefits from consumers and businesses moving their payments from cash to credit and debit cards.
The San Francisco-based company said it earned $4.87 billion, or $2.40 a share, compared to a profit of $4.16 billion, or $2.00 a share, in the same period a year earlier. Excluding one-time items, Visa earned $2.42 a share, which was in line with what analysts had expected, according to FactSet.
Visa processed $3.325 trillion in transactions on its network during the quarter, up 7.4% from a year earlier. Much of the payments growth came from Europe and Latin America, but U.S. payments grew by 5.1%, which is faster than U.S. economic growth.
Visa earns a fee from every transaction processed on its network. That fee varies from industry to industry, and whether it's done with a credit or debit card, but generally it is somewhere between 1% to 4%. Since the pandemic, more consumers globally have been shopping online for goods and services, which has translated into more revenue for Visa in the form of fees.
Even traditionally cash-heavy businesses like bars, barbers and coffee shops have started accepting credit or debit cards as a form of payment.
But while the world continues to move toward digital payments, the pace of adoption may be slowing slightly. Visa reported that credit and debit card payment volumes growth slowed from 8% to 7%. That may be partially due to the size of Visa's market getting too big to grow as quickly as it once did, but it also could be because there are fewer new industries for Visa to switch over to digital.