Visa (NYSE:V)reported earnings today, beating both their revenue and income projections of the Wall St. Medicrocacy. Not only did they raise net income by 23% but they raised guidance going forward. Earnings were $1.08 billion or $1.60/share versus $1.51 consensus from analysts estimates.
Visa saw a 17% rise in international sales and a 16% rise in volume. With the number of Asians entering the middle class in Southeast Asia numbering in the hundreds of millions, it seems unlikely that Visa’s growth prospects will not be capable of going forward.
Visa and MasterCard (NYSE:MA), who also reported strong earnings in the first quarter, 21% net income rise, will face some competition with the rapidly changing technology curve, as EBay’s Paypal (NASDAQ:EBAY) is working on new and innovative ways for people to access their account through their mobile device. You know, that thing that millions of those Asians get before they get a bank account and a credit rating and use to access the internet with for the first time.
The flexibility that PayPal Here may lend to small businesses in parts of the world where storefronts are less, well, regulated than they are in the U.S. is almost unfathomable. It’ll be interesting to see how the credit card companies respond to them as the very cash conscious Asian culture becomes more comfortable with non-cash types of settlement mechanisms.
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