Visa Inc. Reports Strong Fiscal Third Quarter 2017 Results

Performance Driven by Continued Strength in Payments Volume, Cross-Border Volume and Processed Transactions

SAN FRANCISCO--(BUSINESS WIRE)--Jul. 20, 2017-- Visa Inc. (NYSE:V) today announced financial results for the Company’s fiscal third quarter 2017, ended June 30, 2017.

Fiscal Third Quarter 2017 Key Highlights:

• GAAP net income of $2.1 billion or $0.86 per share
• Net operating revenue of $4.6 billion, an increase of 26%, driven by inclusion of Europe and continued growth in payments volume, cross-border volume and processed transactions
• Payments volume growth, on a constant dollar basis, was 38% over the prior year at $1.9 trillion
• Cross-border volume growth, on a constant dollar basis, was 147% or 11% inclusive of Europe in prior year results
• Total Visa processed transactions were 28.5 billion, a 44% increase over the prior year, or 13% growth inclusive of Europe in prior year results
• Returned approximately $2.1 billion of capital to shareholders in the form of share repurchases and dividends

“I’m pleased to report Visa’s fiscal third quarter results which reflect strong growth in payments volume, cross-border volume, and processed transactions, which were powered by economic tailwinds in the U.S. and globally,” said Alfred F. Kelly, Jr., Chief Executive Officer of Visa Inc. “Our results and growth are a reflection of our strategy to pursue the conversion of cash and checks to electronic payments in partnership with our clients around the world.”

Fiscal Third Quarter 2017 Financial Highlights:

GAAP net income in the fiscal third quarter was $2.1 billion or $0.86 per share. Prior year's results included several special items related to the acquisition of Visa Europe. Excluding these special items, net income and earnings per share both increased 26% over the prior year. Exchange rate shifts versus the prior year negatively impacted earnings per share growth by approximately 2 percentage points. All references to earnings per share assume fully-diluted class A share count, inclusive of series B and C convertible participating preferred stock, unless otherwise noted.

Net operating revenue in the fiscal third quarter was $4.6 billion, an increase of 26%, driven by the inclusion of Europe and continued growth in payments volume, cross-border volume and processed transactions. Exchange rate shifts versus the prior year negatively impacted reported net operating revenue growth by approximately 1.5 percentage points.

Payments volume growth, on a constant dollar basis, for the three months ended March 31, 2017, on which fiscal third quarter service revenue is recognized, was 38% over the prior year at $1.7 trillion. Effective with the three months ended December 31, 2016, Europe co-badge volume is no longer included in reported volume.

Payments volume growth, on a constant dollar basis, for the three months ended June 30, 2017, was 38% over the prior year at $1.9 trillion.

Cross-border volume growth, on a constant dollar basis, was 147% for the three months ended June 30, 2017. Cross-border volume growth, on a constant dollar basis and inclusive of Europe in prior year results, was 11%.

Total processed transactions, which represent transactions processed by Visa, for the three months ended June 30, 2017, were 28.5 billion, a 44% increase over the prior year. Total processed transactions growth was 13%, inclusive of Europe in prior year results.

Fiscal third quarter service revenues were $1.9 billion, an increase of 19% over the prior year, and are recognized based on payments volume in the prior quarter. All other revenue categories are recognized based on current quarter activity. Data processing revenues rose 29% over the prior year to $2.0 billion. International transaction revenues grew 45% over the prior year to $1.6 billion. Other revenues were $209 million, flat over the prior year. Client incentives, which are a contra revenue item, were $1.1 billion and represent 20.1% of gross revenues.

GAAP operating expenses were $1.5 billion for the fiscal third quarter, a 52% decrease over the prior year's results which included special items related to the acquisition of Visa Europe. Excluding these special items, operating expenses grew 31% over the prior year, primarily driven from the inclusion of Visa Europe's operating expenses following the acquisition.

GAAP effective income tax rate was 29.3% for the quarter ended June 30, 2017.

Cash, cash equivalents, and available-for-sale investment securities were $12.2 billion at June 30, 2017.

The weighted-average number of diluted shares of class A common stock outstanding was 2.39 billion for the quarter ended June 30, 2017.

Notable Events:

During the three months ended June 30, 2017, the Company repurchased 17.8 million shares of class A common stock, at an average price of $93.82 per share, using $1.7 billion of cash on hand. In the nine months ended June 30, 2017, the Company repurchased a total of 59.2 million shares of class A common stock, at an average price of $86.82 per share, using $5.1 billion of cash on hand. The Company currently has $5.5 billion of funds available for share repurchase.

On July 17, 2017, the board of directors declared a quarterly cash dividend of $0.165 per share of class A common stock (determined in the case of class B and C common stock and series B and C convertible participating preferred stock on an as-converted basis) payable on September 5, 2017, to all holders of record of the Company’s common and preferred stock as of August 18, 2017.

Financial Outlook for Fiscal Full-Year 2017:

Visa Inc. reaffirms its financial outlook for the following GAAP metrics for fiscal full-year 2017:

• Annual operating margin: Mid 60s; and
• Effective tax rate: Mid 40s on a GAAP basis and approximately 30% on an adjusted, non-GAAP basis.

Visa Inc. updates its financial outlook for the following GAAP metrics for fiscal full-year 2017:

• Annual net revenue growth: Approximately 20% on a nominal dollar basis, including approximately 2.0 ppts of negative foreign currency impact;
• Client incentives as a percent of gross revenues: 20.0% to 20.5% range; and
• Annual diluted class A common stock earnings per share growth: Low double-digits on a GAAP nominal dollar basis and approximately 20% on an adjusted, non-GAAP nominal dollar basis (see note below), both including approximately 2.5 ppts of negative foreign currency impact.

Note: The financial outlook for fiscal full-year 2017 includes Visa Europe integration expenses of approximately $60 million for the full-year. Differences in our financial outlook for fiscal full-year 2017 GAAP and non-GAAP financial measures relate to the one-time, non-recurring items that are included in the accompanying reconciliation. Annual adjusted diluted class A common stock earnings per share growth is derived from adjusted full-year 2016 earnings per share results of $2.84. Refer to the accompanying financial tables for further details and a reconciliation of the adjusted fiscal full-year 2016 results.

Fiscal Third Quarter 2017 Earnings Results Conference Call Details:

Visa’s executive management team will host a live audio webcast beginning at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) today to discuss the financial results and business highlights. All interested parties are invited to listen to the live webcast at https://investor.visa.com. A replay of the webcast will be available on the Visa Investor Relations website for 30 days. Investor information, including supplemental financial information, is available on Visa Inc.’s Investor Relations website at https://investor.visa.com.

About Visa Inc.

Visa Inc. (NYSE:V) is a global payments technology company that connects consumers, businesses, financial institutions, and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. We operate one of the world’s most advanced processing networks - VisaNet - that is capable of handling more than 65,000 transaction messages a second, with fraud protection for consumers and assured payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for consumers. Visa’s innovations, however, enable its financial institution customers to offer consumers more choices: pay now with debit, pay ahead with prepaid or pay later with credit products. For more information, visit visa.com/aboutvisa, visacorporate.tumblr.com and @VisaNews.

Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 that relate to, among other things, our future operations, prospects, developments, strategies, business growth and financial outlook for fiscal full-year 2017. Forward-looking statements generally are identified by words such as "believes," "estimates," "expects," "intends," "may," "projects," “outlook”, "could," "should," "will," "continue" and other similar expressions. All statements other than statements of historical fact could be forward-looking statements, which speak only as of the date they are made, are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, many of which are beyond our control and are difficult to predict.

Actual results could differ materially from those expressed in, or implied by, our forward-looking statements due to a variety of factors, including, but not limited to:

• increased oversight and regulation of the global payments industry and our business;
• impact of government-imposed restrictions on payment systems;
• outcome of tax and litigation matters;
• increasingly intense competition in the payments industry, including competition for our clients and merchants;
• proliferation and continuous evolution of new technologies and business models;
• our ability to maintain relationships with our clients, merchants and other third parties;
• brand or reputational damage;
• management changes;
• impact of global economic, political, market and social events or conditions;
• exposure to loss or illiquidity due to settlement guarantees;
• uncertainty surrounding the impact of the United Kingdom’s withdrawal from the European Union;
• cyber security attacks, breaches or failure of our networks;
• failure to maintain interoperability with Visa Europe’s systems;
• our ability to successfully integrate and manage our acquisitions and other strategic investments; and
• other factors described in our filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended September 30, 2016, and our subsequent reports on Forms 10-Q and 8-K.

Except as required by law, we do not intend to update or revise any forward-looking statements as a result of new information, future events or otherwise.

VISA INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
		June 30,				September 30,
		2017				2016
		(in millions, except par value data)
Assets
Cash and cash equivalents		$	7,437			$	5,619
Restricted cash—U.S. litigation escrow			1,030				1,027
Investment securities:
Trading			80				71
Available-for-sale			2,674				3,248
Settlement receivable			1,419				1,467
Accounts receivable			1,105				1,041
Customer collateral			1,075				1,001
Current portion of client incentives			308				284
Prepaid expenses and other current assets			590				555
Total current assets			15,718				14,313
Investment securities, available-for-sale			2,117				3,931
Client incentives			553				448
Property, equipment and technology, net			2,202				2,150
Other assets			1,079				893
Intangible assets, net			27,322				27,234
Goodwill			15,009				15,066
Total assets		$	64,000			$	64,035
Liabilities
Accounts payable		$	130			$	203
Settlement payable			2,075				2,084
Customer collateral			1,075				1,001
Accrued compensation and benefits			638				673
Client incentives			1,909				1,976
Accrued liabilities			940				1,128
Current maturities of long-term debt			1,749				—
Accrued litigation			995				981
Total current liabilities			9,511				8,046
Long-term debt			14,142				15,882
Deferred tax liabilities			5,888				4,808
Deferred purchase consideration			1,258				1,225
Other liabilities			1,257				1,162
Total liabilities			32,056				31,123
Equity
Preferred stock, $0.0001 par value, 25 shares authorized and 5 shares issued and outstanding as follows:
Series A convertible participating preferred stock, none issued			—				—
Series B convertible participating preferred stock, 2 shares issued and outstanding at June 30, 2017 and September 30, 2016			2,326				2,516
Series C convertible participating preferred stock, 3 shares issued and outstanding at June 30, 2017 and September 30, 2016			3,200				3,201
Class A common stock, $0.0001 par value, 2,001,622 shares authorized, 1,832 and 1,871 shares issued and outstanding at June 30, 2017 and September 30, 2016, respectively			—				—
Class B common stock, $0.0001 par value, 622 shares authorized, 245 shares issued and outstanding at June 30, 2017 and September 30, 2016			—				—
Class C common stock, $0.0001 par value, 1,097 shares authorized, 13 and 17 shares issued and outstanding at June 30, 2017 and September 30, 2016, respectively			—				—
Treasury stock			—				(170	)
Right to recover for covered losses			(8	)			(34	)
Additional paid-in capital			17,009				17,395
Accumulated income			9,299				10,462
Accumulated other comprehensive income (loss), net:
Investment securities, available-for-sale			58				36
Defined benefit pension and other postretirement plans			(207	)			(225	)
Derivative instruments classified as cash flow hedges			(15	)			(50	)
Foreign currency translation adjustments			282				(219	)
Total accumulated other comprehensive income (loss), net			118				(458	)
Total equity			31,944				32,912
Total liabilities and equity		$	64,000			$	64,035

VISA INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
		Three Months Ended								Nine Months Ended
		June 30,								June 30,
		2017				2016(1)				2017				2016(1)
		(in millions, except per share data)
Operating Revenues
Service revenues		$	1,948			$	1,635			$	5,859			$	4,979
Data processing revenues			1,984				1,541				5,719				4,493
International transaction revenues			1,571				1,084				4,529				3,160
Other revenues			209				209				615				605
Client incentives			(1,147	)			(839	)			(3,219	)			(2,416	)
Net operating revenues			4,565				3,630				13,503				10,821
Operating Expenses
Personnel			698				509				1,973				1,536
Marketing			221				189				632				569
Network and processing			158				123				453				377
Professional fees			102				138				265				276
Depreciation and amortization			132				120				409				361
General and administrative			230				246				822				566
Litigation provision			—				—				17				1
Visa Europe Framework Agreement loss			—				1,877				—				1,877
Total operating expenses			1,541				3,202				4,571				5,563
Operating income			3,024				428				8,932				5,258
Non-operating (Expense) Income
Interest expense			(140	)			(131	)			(415	)			(292	)
Other			30				125				78				536
Total non-operating (expense) income			(110	)			(6	)			(337	)			244
Income before income taxes			2,914				422				8,595				5,502
Income tax provision			855				10				4,036				1,442
Net income		$	2,059			$	412			$	4,559			$	4,060
Basic earnings per share
Class A common stock		$	0.87			$	0.17			$	1.90			$	1.69
Class B common stock		$	1.43			$	0.29			$	3.13			$	2.79
Class C common stock		$	3.46			$	0.69			$	7.60			$	6.76
Basic weighted-average shares outstanding
Class A common stock			1,840				1,899				1,852				1,915
Class B common stock			245				245				245				245
Class C common stock			14				18				15				19
Diluted earnings per share
Class A common stock		$	0.86			$	0.17			$	1.90			$	1.69
Class B common stock		$	1.42			$	0.28			$	3.13			$	2.78
Class C common stock		$	3.45			$	0.69			$	7.59			$	6.75
Diluted weighted-average shares outstanding
Class A common stock			2,385				2,386				2,404				2,406
Class B common stock			245				245				245				245
Class C common stock			14				18				15				19

(1)

We did not include Visa Europe's financial results in our unaudited consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The dilutive impact of the outstanding shares of series B and C convertible participating preferred stock from June 21, 2016 through June 30, 2016 was also not included in the calculation of basic or diluted earnings per share as the effect was immaterial.

VISA INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
		Nine Months Ended
		June 30,
		2017				2016
		(in millions)
Operating Activities
Net income		$	4,559			$	4,060
Adjustments to reconcile net income to net cash provided by operating activities:
Client incentives			3,219				2,416
Fair value adjustment for the Visa Europe put option			—				(255	)
Share-based compensation			183				152
Excess tax benefit for share-based compensation			—				(51	)
Depreciation and amortization of property, equipment, technology and intangible assets			409				361
Deferred income taxes			1,715				(603	)
Right to recover for covered losses recorded in equity			(165	)			—
Charitable contribution of Visa Inc. shares			192				—
Other			30				43
Change in operating assets and liabilities:
Settlement receivable			42				332
Accounts receivable			(34	)			(92	)
Client incentives			(3,376	)			(2,638	)
Other assets			(192	)			(552	)
Accounts payable			(71	)			(35	)
Settlement payable			(19	)			(368	)
Accrued and other liabilities			(65	)			398
Accrued litigation			14				(46	)
Net cash provided by operating activities			6,441				3,122
Investing Activities
Purchases of property, equipment, technology and intangible assets			(512	)			(382	)
Investment securities, available-for-sale:
Purchases			(1,877	)			(26,883	)
Proceeds from maturities and sales			4,296				26,193
Acquisitions, net of $2.8 billion cash received from Visa Europe			(302	)			(9,082	)
Purchases of / contributions to other investments			(18	)			(9	)
Proceeds / distributions from other investments			—				4
Net cash provided by (used in) investing activities			1,587				(10,159	)
Financing Activities
Repurchase of class A common stock			(5,170	)			(5,300	)
Treasury stock—class C common stock			—				(170	)
Dividends paid			(1,189	)			(1,011	)
Proceeds from issuance of senior notes			—				15,971
Debt issuance costs			—				(98	)
Payments from litigation escrow account—U.S. retrospective responsibility plan			—				45
Cash proceeds from issuance of common stock under employee equity plans			128				69
Restricted stock and performance-based shares settled in cash for taxes			(73	)			(89	)
Excess tax benefit for share-based compensation			—				51
Net cash (used in) provided by financing activities			(6,304	)			9,468
Effect of exchange rate changes on cash and cash equivalents			94				(62	)
Increase in cash and cash equivalents			1,818				2,369
Cash and cash equivalents at beginning of year			5,619				3,518
Cash and cash equivalents at end of period		$	7,437			$	5,887
Supplemental Disclosure
Series B and C convertible participating preferred stock issued in Visa Europe acquisition		$	—			$	5,717
Deferred purchase consideration recorded for Visa Europe acquisition		$	—			$	1,236
Income taxes paid, net of refunds		$	2,239			$	2,043
Interest payments on debt		$	489			$	244
Accruals related to purchases of property, equipment, technology and intangible assets		$	35			$	29

VISA INC.
FISCAL 2017 AND 2016 QUARTERLY RESULTS OF OPERATIONS
(UNAUDITED)
		Fiscal 2017 Quarter Ended												Fiscal 2016 Quarter Ended
		June 30,				March 31,				December 31,				September 30,				June 30,
		2017				2016				2016				2016				2016(1)
		(in millions)
Operating Revenues
Service revenues		$	1,948			$	1,993			$	1,918			$	1,768			$	1,635
Data processing revenues			1,984				1,843				1,892				1,779				1,541
International transaction revenues			1,571				1,469				1,489				1,489				1,084
Other revenues			209				203				203				218				209
Client incentives			(1,147	)			(1,031	)			(1,041	)			(993	)			(839	)
Net operating revenues			4,565				4,477				4,461				4,261				3,630
Operating Expenses
Personnel			698				704				571				690				509
Marketing			221				193				218				300				189
Network and processing			158				150				145				161				123
Professional fees			102				83				80				113				138
Depreciation and amortization			132				131				146				141				120
General and administrative			230				406				186				230				246
Litigation provision			—				2				15				1				—
Visa Europe Framework Agreement loss			—				—				—				—				1,877
Total operating expenses			1,541				1,669				1,361				1,636				3,202
Operating income			3,024				2,808				3,100				2,625				428
Non-operating (Expense) Income
Interest expense			(140	)			(135	)			(140	)			(135	)			(131	)
Other			30				29				19				20				125
Total non-operating (expense) income			(110	)			(106	)			(121	)			(115	)			(6	)
Income before income taxes			2,914				2,702				2,979				2,510				422
Income tax provision			855				2,272				909				579				10
Net income		$	2,059			$	430			$	2,070			$	1,931			$	412

(1)		We did not include Visa Europe's financial results in our unaudited consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial.

VISA INC.

RECONCILIATION OF NON-GAAP FINANCIAL RESULTS

FISCAL THIRD QUARTER 2017 and 2016

(UNAUDITED)

Our financial results for the nine months ended June 30, 2017 and three and nine months ended June 30, 2016 reflect the impact of certain significant items that we do not believe are indicative of our ongoing operating performance in these or future periods as they are either non-recurring or have no cash impact. As such, we believe the presentation of adjusted financial results excluding the following items provides a clearer understanding of our operating performance for the periods presented. There were no comparable adjustments recorded for the three months ended June 30, 2017.

• Elimination of deferred tax balances. During the second quarter of fiscal 2017, in connection with our legal entity reorganization, we eliminated deferred tax balances originally recognized upon the acquisition of Visa Europe, resulting in the recognition of a non-recurring, non-cash income tax provision of $1.5 billion.
• Charitable contribution. During the second quarter of fiscal 2017, associated with our legal entity reorganization, we recognized a non-recurring, non-cash general and administrative expense of $192 million, before tax, related to the charitable donation of Visa Inc. shares that were acquired as part of the Visa Europe acquisition and held as treasury stock. Net of the related cash tax benefit of $71 million, determined by applying applicable tax rates, adjusted net income increased by $121 million.
• Acquisition-related costs. During the three months ended June 30, 2016, we incurred $152 million of non-recurring acquisition costs in operating expense as a result of the Visa Europe transaction. This amount is comprised of $60 million of transaction expenses recorded in professional fees, and $92 million of U.K. stamp duty recorded in general and administrative expenses. Net of related tax benefit of $56 million, determined by applying applicable federal and state tax rates, the adjustment to net income was an increase of $96 million.
• Visa Europe Framework Agreement loss. Upon consummation of the transaction, on June 21, 2016, we recorded a non-recurring loss of $1.9 billion, before tax, in operating expense resulting from the effective settlement of the Framework Agreement between us and Visa Europe. Net of related tax benefit of $693 million, determined by applying applicable federal and state tax rates, the adjustment to net income was an increase of $1.2 billion.
• Net (losses) gains on currency forward contracts. During the second and third quarter of fiscal 2016, we entered into currency forward contracts to mitigate a portion of our foreign currency exchange rate risk associated with the upfront cash consideration paid in the Visa Europe acquisition. As a result, we recorded non-recurring, net losses of $42 million and net gains of $74 million, before tax, in other non-operating (expense) income for the three and nine months ended June 30, 2016, respectively. Net of related tax benefit of $8 million and tax expense of $27 million for the three and nine months ended June 30, 2016, respectively, determined by applying applicable federal and state tax rates, the adjustment to net income was an increase of $34 million and a decrease of $47 million, respectively.
• Foreign exchange gain on euro deposits. During the three months ended June 30, 2016, we recorded a non-recurring foreign exchange gain of $145 million, before tax, in other non-operating income resulting from holding euro-denominated bank balances for a short period in advance of the Closing. Net of related tax expense of $54 million, determined by applying applicable federal and state tax rates, the impact to net income was a decrease of $91 million.
• Revaluation of Visa Europe put option. During the first quarter of fiscal 2016, we recorded a decrease of $255 million in the fair value of the Visa Europe put option, resulting in the recognition of non-cash income in other non-operating income. This amount is not subject to income tax and therefore has no impact on our reported income tax provision.

Adjusted financial results are non-GAAP financial measures and should not be relied upon as substitutes for measures calculated in accordance with U.S. GAAP. The following tables reconcile our as-reported financial measures calculated in accordance with U.S. GAAP, to our respective non-GAAP adjusted financial measures for the nine months ended June 30, 2017 and three and nine months ended June 30, 2016. There were no comparable adjustments recorded for the three months ended June 30, 2017.

		Nine Months Ended June 30, 2017
									Non-				Income								Effective							Diluted
(in millions, except						Operating			operating				Before								Income							Earnings
percentages and per share		Operating				Margin			Income				Income				Income Tax				Tax			Net				Per
data)		Expenses				(1),(2)			(Expense)				Taxes				Provision				Rate(1)			Income				Share(1)
As reported		$	4,571			66	%		$	(337	)		$	8,595			$	4,036			47.0	%		$	4,559			$	1.90
Elimination of deferred tax balances			—			—	%			—				—				(1,515	)						1,515				0.63
Charitable contribution			(192	)		1	%			—				192				71							121				0.05
As adjusted		$	4,379			68	%		$	(337	)		$	8,787			$	2,592			29.5	%		$	6,195			$	2.58
		Three Months Ended June 30, 2016
									Non-				Income								Effective							Diluted
(in millions, except						Operating			operating				Before								Income							Earnings
percentages and per share		Operating				Margin			Income				Income				Income Tax				Tax			Net				Per
data)		Expenses				(1),(2)			(Expense)				Taxes				Provision				Rate(1)			Income				Share(1)
As reported		$	3,202			12	%		$	(6	)		$	422			$	10			2.3	%		$	412			$	0.17
Acquisition-related costs			(152	)		4	%			—				152				56							96				0.04
Visa Europe Framework Agreement loss			(1,877	)		52	%			—				1,877				693							1,184				0.50
Net losses on currency forward contracts			—			—	%			42				42				8							34				0.01
Foreign exchange gain on euro deposits			—			—	%			(145	)			(145	)			(54	)						(91	)			(0.04	)
As adjusted		$	1,173			68	%		$	(109	)		$	2,348			$	713			30.4	%		$	1,635			$	0.69
		Nine Months Ended June 30, 2016
									Non-				Income								Effective							Diluted
(in millions, except						Operating			operating				Before								Income							Earnings
percentages and per share		Operating				Margin			Income				Income				Income Tax				Tax			Net				Per
data)		Expenses				(1),(2)			(Expense)				Taxes				Provision				Rate(1)			Income				Share(1)
As reported		$	5,563			49	%		$	244			$	5,502			$	1,442			26.2	%		$	4,060			$	1.69
Acquisition-related costs			(152	)		1	%			—				152				56							96				0.04
Visa Europe Framework Agreement loss			(1,877	)		17	%			—				1,877				693							1,184				0.49
Net gains on currency forward contracts			—			—	%			(74	)			(74	)			(27	)						(47	)			(0.02	)
Foreign exchange gain on euro deposits			—			—	%			(145	)			(145	)			(54	)						(91	)			(0.04	)
Revaluation of Visa Europe put option			—			—	%			(255	)			(255	)			—							(255	)			(0.11	)
As adjusted		$	3,534			67	%		$	(230	)		$	7,057			$	2,110			29.9	%		$	4,947			$	2.06

(1)		Figures in the table may not recalculate exactly due to rounding. Operating margin, effective income tax rate, diluted earnings per share and their respective totals are calculated based on unrounded numbers.
(2)		Operating margin is calculated as operating income divided by net operating revenues.

VISA INC.

RECONCILIATION OF NON-GAAP FINANCIAL RESULTS

FISCAL FULL-YEAR 2016

(UNAUDITED)

Our fiscal full-year 2017 annual diluted class A common stock earnings per share growth outlook is based on adjusted non-GAAP fiscal full-year 2016 results, which are reconciled to their closest comparable U.S. GAAP financial measure below.

Our financial results during the twelve months ended September 30, 2016 reflect the impact of certain significant items that we do not believe are indicative of our ongoing operating performance, as they are either non-recurring or have no cash impact. As such, we believe the presentation of adjusted financial results excluding the following items provides a clearer understanding of our operating performance for the period presented.

• Severance cost. In the fiscal fourth quarter, we recorded a $110 million charge for severance costs related to personnel reductions including planned reductions at Visa Europe. Although we routinely record severance expenses, these charges are larger than any past quarterly accrual due to the acquisition and integration of Visa Europe. Net of related tax benefit of $38 million, determined by applying applicable tax rates, the adjustment to net income was an increase of $72 million.
• Remeasurement of deferred tax liability. In September 2016, we recorded a non-cash, non-recurring $88 million gain upon the remeasurement of a deferred tax liability, recorded upon the acquisition of Visa Europe, to reflect a tax rate change in the United Kingdom.
• Acquisition-related costs. During the twelve months ended September 30, 2016, we incurred $152 million of non-recurring acquisition costs in operating expense as a result of the Visa Europe transaction. This amount is comprised of $60 million of transaction expenses recorded in professional fees, and $92 million of U.K. stamp duty recorded in general and administrative expenses. Net of related tax benefit of $56 million, determined by applying applicable federal and state tax rates, the adjustment to net income was an increase of $96 million.
• Visa Europe Framework Agreement loss. Upon consummation of the transaction, on June 21, 2016, we recorded a non-recurring loss of $1.9 billion, before tax, in operating expense resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. Net of related tax benefit of $693 million, determined by applying applicable federal and state tax rates, the adjustment to net income was an increase of $1.2 billion.
• Net gains on currency forward contracts. During the twelve months ended September 30, 2016, we entered into currency forward contracts to mitigate a portion of the foreign currency exchange rate risk associated with the upfront cash consideration paid in the Visa Europe acquisition. As a result, we recorded non-recurring, net gains of $74 million, before tax, in other non-operating income. Net of related tax expense of $27 million, determined by applying applicable federal and state tax rates, the adjustment to net income was a decrease of $47 million.
• Foreign exchange gain on euro deposits. During the twelve months ended September 30, 2016, we recorded a non-recurring foreign exchange gain of $145 million, before tax, in other non-operating income as a result of holding euro-denominated bank balances for a short period in advance of the closing date of the Visa Europe transaction. Net of related tax expense of $54 million, determined by applying applicable federal and state tax rates, the impact to net income was a decrease of $91 million.
• Revaluation of Visa Europe put option. During the first quarter of fiscal 2016, we recorded a decrease of $255 million in the fair value of the Visa Europe put option, resulting in the recognition of non-cash income in other non-operating income. This amount is not subject to income tax and therefore has no impact on the reported income tax provision.

Adjusted financial results are non-GAAP financial measures and should not be relied upon as substitutes for measures calculated in accordance with U.S. GAAP. The following table reconciles our as-reported financial measures calculated in accordance with U.S. GAAP, to the respective non-GAAP adjusted financial measures for the twelve months ended September 30, 2016.

		Twelve Months Ended September 30, 2016 (1)
									Non-				Income								Effective							Diluted
(in millions, except						Operating			operating				Before								Income							Earnings
percentages and per share		Operating				Margin			Income				Income				Income				Tax Rate			Net				Per
data)		Expenses				(2),(3)			(Expense)				Taxes				Taxes				(2)			Income				Share(2)
As reported		$	7,199			52	%		$	129			$	8,012			$	2,021			25.2	%		$	5,991			$	2.48
Severance cost			(110	)		1	%			—				110				38							72				0.03
Remeasurement of deferred tax liability			—			—	%			—				—				88							(88	)			(0.04	)
Acquisition-related costs			(152	)		1	%			—				152				56							96				0.04
Visa Europe Framework Agreement loss			(1,877	)		12	%			—				1,877				693							1,184				0.49
Net gains on currency forward contracts			—			—	%			(74	)			(74	)			(27	)						(47	)			(0.02	)
Foreign exchange gain on euro deposits			—			—	%			(145	)			(145	)			(54	)						(91	)			(0.04	)
Revaluation of Visa Europe put option			—			—	%			(255	)			(255	)			—							(255	)			(0.11	)
As adjusted		$	5,060			66	%		$	(345	)		$	9,677			$	2,815			29.1	%		$	6,862			$	2.84

(1)		We did not include Visa Europe's financial results in our unaudited consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. Our unaudited consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016.
(2)		Figures in the table may not recalculate exactly due to rounding. Operating margin, effective income tax rate, diluted earnings per share and their respective totals are calculated based on unrounded numbers.
(3)		Operating margin is calculated as operating income divided by net operating revenues.

Operational Performance Data

The tables below provide information regarding the available operational results for the 3 months ended June 30, 2017, as well as the prior four quarterly reporting periods and the 12 months ended June 30, 2017 and 2016, for cards carrying the Visa, Visa Electron, V PAY and Interlink brands. Sections 1-4 below reflect the acquisition of Visa Europe, with Europe included in Visa Inc. results effective the 3 months ended September 30, 2016.

1. Branded Volume and Transactions

The tables present regional total volume, payments volume, and cash volume, and the number of payments transactions, cash transactions, accounts and cards for cards carrying the Visa, Visa Electron, V PAY and Interlink brands. Card counts include PLUS proprietary cards. Nominal and constant dollar growth rates over prior years are provided for volume-based data.

		For the 3 Months Ended June 30, 2017
		Total			Growth			Growth			Payments			Growth			Growth			Payments			Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions			Volume			(Nominal			(Constant			Transactions
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)			($ billions)			USD)			USD)			(millions)
All Visa Credit & Debit
Asia Pacific		$	531		(0.1	%)		1.7	%		$	411		4.5	%		6.9	%		5,834			$	120		(13.1	%)		(13.0	%)		876
Canada			64		2.7	%		6.8	%			59		3.2	%		7.3	%		837				5		(2.2	%)		1.7	%		12
CEMEA			259		11.3	%		6.7	%			80		25.8	%		18.9	%		3,232				179		5.8	%		2.0	%		1,283
LAC			248		10.8	%		8.1	%			99		16.2	%		13.3	%		2,918				148		7.5	%		4.9	%		1,161
US			980		10.9	%		10.9	%			840		12.1	%		12.1	%		15,928				140		4.7	%		4.7	%		1,010
Europe			511									371								7,955				140								1,093
Visa Inc.			2,592		34.1	%		33.8	%			1,860		37.9	%		38.4	%		36,704				732		25.4	%		23.4	%		5,435
Visa Credit Programs
US		$	460		17.9	%		17.9	%		$	446		18.8	%		18.8	%		5,519			$	14		(4.0	%)		(4.0	%)		16
International			654		27.6	%		29.6	%			604		26.7	%		29.0	%		8,730				51		39.0	%		37.5	%		235
Visa Inc.			1,115		23.4	%		24.5	%			1,050		23.2	%		24.5	%		14,249				65		26.6	%		25.6	%		251
Visa Debit Programs
US		$	519		5.4	%		5.4	%		$	393		5.3	%		5.3	%		10,409			$	126		5.8	%		5.8	%		994
International			958		78.5	%		74.5	%			417		238.1	%		229.5	%		12,046				541		30.9	%		28.1	%		4,190
Visa Inc.			1,478		43.5	%		41.8	%			811		63.1	%		62.0	%		22,455				667		25.3	%		23.2	%		5,184

		For the 3 Months Ended March 31, 2017
		Total			Growth			Growth			Payments			Growth			Growth			Payments			Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions			Volume			(Nominal			(Constant			Transactions		Accounts		Cards
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)			($ billions)			USD)			USD)			(millions)		(millions)		(millions)
All Visa Credit & Debit
Asia Pacific		$	514		0.7	%		1.8	%		$	398		5.7	%		7.0	%		5,509			$	117		(13.4	%)		(12.8	%)		857		817		924
Canada			58		13.1	%		8.7	%			53		13.8	%		9.4	%		721				5		5.9	%		1.8	%		10		48		55
CEMEA			236		15.2	%		6.9	%			73		28.5	%		16.7	%		2,907				163		10.1	%		3.0	%		1,213		341		331
LAC			240		17.9	%		11.3	%			96		21.4	%		13.4	%		3,021				144		15.7	%		9.9	%		1,142		419		455
US			909		10.5	%		10.5	%			776		11.8	%		11.8	%		14,580				133		3.2	%		3.2	%		933		712		859
Europe			462									339								7,275				123								1,012		480		533
Visa Inc.			2,419		34.9	%		33.1	%			1,734		38.5	%		37.5	%		34,013				685		26.7	%		23.0	%		5,167		2,818		3,155
Visa Credit Programs
US		$	418		19.9	%		19.9	%		$	404		20.7	%		20.7	%		4,856			$	14		0.3	%		0.3	%		16		274		334
International			619		30.5	%		29.4	%			572		28.5	%		27.9	%		8,298				48		59.6	%		50.7	%		222		649		726
Visa Inc.			1,038		26.0	%		25.4	%			976		25.2	%		24.8	%		13,154				62		40.3	%		34.9	%		238		924		1,060
Visa Debit Programs
US		$	491		3.5	%		3.5	%		$	372		3.5	%		3.5	%		9,724			$	119		3.6	%		3.6	%		917		437		524
International			890		79.8	%		72.6	%			386		241.1	%		222.9	%		11,135				504		32.0	%		27.3	%		4,012		1,457		1,571
Visa Inc.			1,381		42.5	%		39.5	%			758		60.4	%		58.3	%		20,859				623		25.5	%		22.0	%		4,929		1,894		2,096

		For the 3 Months Ended December 31, 2016
		Total			Growth			Growth			Payments			Growth			Growth			Payments		Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions		Volume			(Nominal			(Constant			Transactions		Accounts		Cards
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)		($ billions)			USD)			USD)			(millions)		(millions)		(millions)
All Visa Credit & Debit
Asia Pacific		$	538		2.8	%		3.7	%		$	419		8.2	%		9.4	%		5,662		$	119		(12.6	%)		(12.5	%)		920		802		908
Canada			63		5.5	%		5.1	%			58		5.7	%		5.3	%		778			5		3.5	%		3.1	%		10		50		55
CEMEA			246		7.8	%		8.7	%			72		19.8	%		19.9	%		2,823			174		3.5	%		4.7	%		1,302		334		322
LAC			250		5.6	%		8.7	%			98		9.5	%		11.9	%		3,155			152		3.2	%		6.7	%		1,215		418		453
US			937		11.4	%		11.4	%			804		12.6	%		12.6	%		15,326			134		4.4	%		4.4	%		935		718		862
Europe			491									355								7,661			136								1,094		486		542
Visa Inc.			2,525		33.6	%		34.5	%			1,805		38.3	%		39.0	%		35,405			720		23.2	%		24.6	%		5,476		2,808		3,143
Visa Credit Programs
US		$	444		19.5	%		19.5	%		$	430		20.3	%		20.3	%		5,350		$	14		0.0	%		0.0	%		16		282		335
International			647		28.3	%		29.7	%			597		27.0	%		28.4	%		8,683			50		46.9	%		47.6	%		243		653		728
Visa Inc.			1,092		24.6	%		25.4	%			1,027		24.1	%		24.9	%		14,033			64		33.0	%		33.4	%		259		935		1,062
Visa Debit Programs
US		$	493		4.9	%		4.9	%		$	374		4.9	%		4.9	%		9,976		$	119		5.0	%		5.0	%		919		437		527
International			940		73.0	%		75.5	%			404		234.0	%		236.8	%		11,396			536		26.9	%		28.9	%		4,298		1,437		1,554
Visa Inc.			1,433		41.4	%		42.5	%			778		62.9	%		63.3	%		21,372			655		22.3	%		23.8	%		5,217		1,873		2,080

		For the 3 Months Ended September 30, 2016
		Total			Growth			Growth			Payments			Growth			Growth			Payments			Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions			Volume			(Nominal			(Constant			Transactions		Accounts		Cards
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)			($ billions)			USD)			USD)			(millions)		(millions)		(millions)
All Visa Credit & Debit
Asia Pacific		$	536		5.1	%		3.9	%		$	406		9.4	%		7.8	%		5,244			$	129		(6.4	%)		(6.6	%)		997		786		891
Canada			62		5.9	%		5.8	%			57		5.9	%		5.7	%		763				5		6.3	%		6.2	%		12		48		56
CEMEA			237		2.4	%		7.6	%			68		11.9	%		16.6	%		2,583				169		(1.0	%)		4.3	%		1,242		329		318
LAC			236		3.9	%		10.5	%			91		7.2	%		13.7	%		2,995				145		1.9	%		8.6	%		1,165		408		444
US			903		9.9	%		9.9	%			768		10.8	%		10.8	%		14,925				135		5.1	%		5.1	%		956		697		835
Europe			648									468								9,581				179								1,432		479		542
Visa Inc.			2,622		41.8	%		43.3	%			1,859		47.0	%		47.2	%		36,091				763		30.5	%		34.4	%		5,804		2,747		3,086
Visa Credit Programs
US		$	424		18.3	%		18.3	%		$	409		18.8	%		18.8	%		5,123			$	15		6.1	%		6.1	%		18		276		329
International			725		47.6	%		47.4	%			656		44.0	%		43.6	%		9,556				69		94.2	%		98.3	%		394		655		731
Visa Inc.			1,149		35.2	%		35.1	%			1,066		33.1	%		32.9	%		14,678				84		68.8	%		71.3	%		413		931		1,060
Visa Debit Programs
US		$	479		3.4	%		3.4	%		$	359		2.9	%		2.9	%		9,802			$	120		4.9	%		4.9	%		938		421		506
International			994		85.3	%		92.4	%			435		276.3	%		287.0	%		11,611				559		32.9	%		38.3	%		4,453		1,395		1,519
Visa Inc.			1,472		47.4	%		50.3	%			793		71.0	%		72.2	%		21,413				679		26.9	%		30.9	%		5,391		1,816		2,026

		For the 3 Months Ended June 30, 2016
		Total			Growth			Growth			Payments			Growth			Growth			Payments		Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions		Volume			(Nominal			(Constant			Transactions		Accounts		Cards
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)		($ billions)			USD)			USD)			(millions)		(millions)		(millions)
All Visa Credit & Debit
Asia Pacific		$	531		4.3	%		7.2	%		$	393		7.9	%		10.3	%		5,055		$	138		(5.0	%)		(0.4	%)		1,014		766		870
Canada			62		0.7	%		6.7	%			57		0.5	%		6.4	%		741			5		3.6	%		9.7	%		11		47		54
CEMEA			233		(2.0	%)		11.4	%			64		4.8	%		18.8	%		2,415			169		(4.3	%)		8.8	%		1,255		331		318
LAC			223		(5.8	%)		10.1	%			86		(3.3	%)		13.3	%		2,860			138		(7.2	%)		8.2	%		1,127		409		445
US			883		9.1	%		9.1	%			749		9.7	%		9.7	%		14,680			134		5.9	%		5.9	%		973		677		818
Visa Inc.			1,933		4.2	%		8.9	%			1,349		7.6	%		10.4	%		25,752			584		(3.0	%)		5.7	%		4,380		2,230		2,505
Visa Credit Programs
US		$	390		10.9	%		10.9	%		$	376		10.9	%		10.9	%		4,583		$	15		10.9	%		10.9	%		17		271		322
International			513		4.5	%		9.6	%			476		5.1	%		9.7	%		6,623			37		(2.0	%)		7.6	%		159		509		569
Visa Inc.			903		7.2	%		10.1	%			852		7.5	%		10.2	%		11,206			51		1.4	%		8.5	%		176		780		891
Visa Debit Programs
US		$	493		7.7	%		7.7	%		$	374		8.5	%		8.5	%		10,097		$	119		5.3	%		5.3	%		956		406		495
International			537		(3.3	%)		8.0	%			123		5.4	%		17.3	%		4,449			414		(5.6	%)		5.5	%		3,249		1,044		1,118
Visa Inc.			1,030		1.7	%		7.9	%			497		7.7	%		10.6	%		14,546			533		(3.4	%)		5.5	%		4,204		1,450		1,614

		For the 12 Months Ended June 30, 2017
		Total			Growth			Growth			Payments			Growth			Growth			Payments		Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions		Volume			(Nominal			(Constant			Transactions
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)		($ billions)			USD)			USD)			(millions)
All Visa Credit & Debit
Asia Pacific		$	2,119		2.1	%		2.8	%		$	1,634		6.9	%		7.8	%		22,249		$	485		(11.3	%)		(11.2	%)		3,650
Canada			246		6.5	%		6.5	%			226		6.8	%		6.8	%		3,099			20		3.2	%		3.2	%		44
CEMEA			978		9.0	%		7.5	%			293		21.4	%		18.1	%		11,545			685		4.4	%		3.5	%		5,040
LAC			974		9.3	%		9.6	%			385		13.4	%		13.1	%		12,089			589		6.7	%		7.4	%		4,682
US			3,729		10.7	%		10.7	%			3,187		11.8	%		11.8	%		60,760			542		4.4	%		4.4	%		3,835
Europe			2,112									1,533								32,472			579								4,631
Visa Inc.			10,158		36.1	%		36.1	%			7,258		40.4	%		40.5	%		142,214			2,900		26.4	%		26.3	%		21,882
Visa Credit Programs
US		$	1,747		18.9	%		18.9	%		$	1,689		19.6	%		19.6	%		20,848		$	58		0.6	%		0.6	%		66
International			2,646		33.4	%		34.0	%			2,429		31.5	%		32.2	%		35,267			217		59.9	%		58.4	%		1,094
Visa Inc.			4,393		27.2	%		27.6	%			4,118		26.3	%		26.7	%		56,115			275		42.1	%		41.2	%		1,161
Visa Debit Programs
US		$	1,982		4.3	%		4.3	%		$	1,498		4.2	%		4.2	%		39,911		$	484		4.8	%		4.8	%		3,768
International			3,783		79.1	%		78.7	%			1,642		247.1	%		243.2	%		46,187			2,141		30.6	%		30.6	%		16,953
Visa Inc.			5,765		43.7	%		43.5	%			3,140		64.3	%		63.8	%		86,098			2,625		25.0	%		25.0	%		20,721

		For the 12 Months Ended June 30, 2016
		Total			Growth			Growth			Payments			Growth			Growth			Payments		Cash			Growth			Growth			Cash
		Volume			(Nominal			(Constant			Volume			(Nominal			(Constant			Transactions		Volume			(Nominal			(Constant			Transactions		Accounts		Cards
		($ billions)			USD)			USD)			($ billions)			USD)			USD)			(millions)		($ billions)			USD)			USD)			(millions)		(millions)		(millions)
All Visa Credit & Debit
Asia Pacific		$	2,076		2.7	%		9.2	%		$	1,528		7.7	%		13.8	%		19,370		$	548		(9.1	%)		(1.6	%)		4,062		766		870
Canada			231		(7.0	%)		5.5	%			212		(7.2	%)		5.3	%		2,820			19		(4.8	%)		7.9	%		46		47		54
CEMEA			897		(9.6	%)		8.8	%			241		(2.2	%)		16.6	%		8,614			656		(12.0	%)		6.1	%		4,847		331		318
LAC			891		(14.4	%)		8.8	%			339		(14.0	%)		12.3	%		11,278			552		(14.7	%)		6.8	%		4,480		409		445
US			3,370		9.2	%		9.2	%			2,850		9.9	%		9.9	%		55,929			520		5.7	%		5.7	%		3,798		677		818
Visa Inc.			7,464		1.0	%		9.0	%			5,171		5.9	%		11.3	%		98,012			2,294		(8.5	%)		4.2	%		17,234		2,230		2,505
Visa Credit Programs
US		$	1,470		10.1	%		10.1	%		$	1,412		10.2	%		10.2	%		17,261		$	58		7.6	%		7.6	%		67		271		322
International			1,983		0.7	%		11.4	%			1,847		2.2	%		12.4	%		25,605			136		(16.4	%)		(0.7	%)		643		509		569
Visa Inc.			3,453		4.5	%		10.8	%			3,259		5.5	%		11.4	%		42,866			194		(10.4	%)		1.7	%		710		780		891
Visa Debit Programs
US		$	1,900		8.5	%		8.5	%		$	1,438		9.6	%		9.6	%		38,667		$	462		5.5	%		5.5	%		3,731		406		495
International			2,111		(9.5	%)		6.6	%			473		(1.7	%)		15.4	%		16,478			1,638		(11.6	%)		4.2	%		12,793		1,044		1,118
Visa Inc.			4,011		(1.8	%)		7.5	%			1,911		6.6	%		11.0	%		55,145			2,100		(8.3	%)		4.5	%		16,524		1,450		1,614

2. Europe Co-badge Payments Volume Growth Impact

The table below reflects total Visa Inc., International and Europe payments volume growth rates over prior year adjusted to exclude the Europe co-badge volumes.

		Growth															Growth
		(Constant USD)															(Nominal USD)
		Quarter Ended															Quarter Ended
		Sep'16			Dec'16			Mar'17			Jun'17						Sep'16			Dec'16			Mar'17			Jun'17
Visa Inc. - As Reported		47.2	%		39.0	%		37.5	%		38.4	%					47.0	%		38.3	%		38.5	%		37.9	%
excluding co-badge		38.7	%		39.0	%		37.5	%		38.4	%					38.5	%		38.3	%		38.5	%		37.9	%
International - As Reported		91.6	%		71.1	%		69.1	%		71.7	%					91.0	%		69.3	%		71.6	%		70.2	%
excluding co-badge		72.6	%		71.1	%		69.1	%		71.7	%					72.0	%		69.3	%		71.6	%		70.2	%
Europe Normalized (1)		6.8	%		(17.1	%)		(16.6	%)		(16.5	%)					(1.2	%)		(25.8	%)		(24.3	%)		(22.4	%)
excluding co-badge		7.5	%		9.7	%		9.7	%		9.3	%					(2.8	%)		(4.3	%)		(2.3	%)		0.3	%

(1)		Europe volumes were first included in Visa Inc.’s volumes starting in the quarter ended September 30, 2016. Europe Normalized growth includes Europe volumes for the prior year period before Visa Inc. acquired Visa Europe.

Note:

Effective June 9, 2016, Article 8 of the EU Interchange Fee Regulation states that payment card networks cannot impose reporting requirements or the obligation to pay fees on payment transactions where their payment brand is present but their network is not used. Prior to this regulation, Visa collected a small service fee in a few countries, particularly France, on domestic payment transactions where Visa cards are co-badged with a domestic network. Clients in Europe continued to report co-badged volume through the quarter ended September 2016; however, effective with the quarter ended December 2016 Visa co-badge volume is no longer included in reported volume.

3. Cross-Border Volume

The table below represents cross-border volume growth for cards carrying the Visa, Visa Electron, V PAY, Interlink and PLUS brands. Cross-border volume refers to payments and cash volume where the issuing country is different from the merchant country.

								Normalized
		Growth			Growth			Growth (2)
Period		(Nominal USD)			(Constant USD)			(Constant USD)
3 Months Ended
June 30, 2017 (1)		142	%		147	%		11	%
March 31, 2017 (1)		129	%		132	%		11	%
December 31, 2016 (1)		135	%		140	%		12	%
September 30, 2016 (1)		146	%		149	%		10	%
June 30, 2016		2	%		5	%
12 Months Ended
June 30, 2017 (1)		138	%		142	%
June 30, 2016		(1	%)		5	%

(1)		Europe is included as part of Visa Inc. effective with the 3 months ended September 30, 2016.
(2)		Europe volumes and transactions were first included as part of Visa Inc. starting in the quarter ended September 30, 2016. Normalized Growth includes Europe activity in prior year periods before Visa Inc. acquired Visa Europe.

4. Visa Processed Transactions

The table below represents transactions involving Visa, Visa Electron, V PAY, Interlink and PLUS cards processed on Visa’s networks.

		Processed
		Transactions					Normalized
Period		(millions)		Growth			Growth (2)
3 Months Ended
June 30, 2017 (1)		28,450		44	%		13	%
March 31, 2017 (1)		26,256		42	%		12	%
December 31, 2016 (1)		27,329		44	%		13	%
September 30, 2016 (1)		25,921		41	%		12	%
June 30, 2016		19,778		10	%
12 Months Ended
June 30, 2017 (1)		107,955		43	%
June 30, 2016		75,603		9	%

(1)		Europe is included as part of Visa Inc. effective with the 3 months ended September 30, 2016.
(2)		Europe volumes and transactions were first included as part of Visa Inc. starting in the quarter ended September 30, 2016. Normalized Growth includes Europe activity in prior year periods before Visa Inc. acquired Visa Europe.

Footnote

Payments volume represents the aggregate dollar amount of purchases made with cards carrying the Visa, Visa Electron, V PAY and Interlink brands for the relevant period, and cash volume represents the aggregate dollar amount of cash disbursements obtained with these cards for the relevant period and includes the impact of balance transfers and convenience checks, but excludes proprietary PLUS volume. Total volume represents payments and cash volume.

Visa payment products are comprised of credit and debit programs, and data relating to each program is included in the tables. Debit programs include Visa’s signature based and Interlink (PIN) debit programs.

The data presented is based on results reported quarterly by Visa’s financial institution clients on their operating certificates. Estimates may be utilized if data is unavailable.

On occasion, previously presented information may be updated. Prior period updates, if any, are not material.

Europe is reported and included in Visa Inc. results effective with the 3 months ended September 2016. Visa’s CEMEA region is comprised of countries in Central Europe, the Middle East and Africa. Several European Union countries in Central Europe, Israel and Turkey are not included in CEMEA. LAC is comprised of countries in Central and South America and the Caribbean. International includes Asia Pacific, Canada, CEMEA, Europe and LAC.

Information denominated in U.S. dollars is calculated by applying an established U.S. dollar/local currency exchange rate for each local currency in which Visa Inc. volumes are reported (“Nominal USD”). These exchange rates are calculated on a quarterly basis using the established exchange rate for each quarter. To eliminate the impact of foreign currency fluctuations against the U.S. dollar in measuring performance, Visa Inc. also reports year-over-year growth in total volume, payments volume and cash volume on the basis of local currency information (“Constant USD”). This presentation represents Visa’s historical methodology which may be subject to review and refinement.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20170720006149/en/

Source: Visa Inc.

Visa Inc.
Investor Relations:
Jack Carsky, Joon Huh, or Victoria Hyde-Dunn, 650-432-7644
ir@visa.com
or
Media Relations:
Nathaniel Sillin, 415-805-4892
globalmedia@visa.com