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Visa Inc. 10-Q Summary: Quarter Ended June 30, 2026

Business Context and Reporting Period

This report covers Visa Inc.'s financial performance for the third quarter of fiscal year 2026, ended June 30, 2026. Visa operates as a global payments technology company facilitating secure commerce through its VisaNet network. The company reported strong growth in nominal payments volume and processed transactions, driven by resilient consumer spending and expansion in digital commerce. Notable corporate activities during the period included the acquisition of Prisma and Newpay in Argentina and a significant exchange offer involving Class B-1 and B-2 common stock.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Growth: Net revenue increased 14% in Q3 and 15% YTD compared to the prior year. This was driven by an 11% increase in nominal payments volume and a 10% increase in processed transactions. International revenue grew 16% in Q3.
• Expense Increases: Operating expenses rose 19% in Q3 and 13% YTD. The primary drivers were higher personnel expenses (due to severance costs and headcount growth) and marketing expenses (driven by the FIFA World Cup 2026 and Olympic Winter Games).
• Litigation Provisions: The litigation provision decreased significantly by 59% in Q3 ($253 million vs. $615 million) and 22% YTD ($1,290 million vs. $1,659 million) compared to the prior year, reflecting lower accruals for U.S. covered litigation.
• Acquisitions: Visa acquired Prisma and Newpay in Argentina for $1.5 billion in cash in February 2026 to accelerate technology deployment in the region.
• Capital Allocation: The company repurchased 50 million shares of Class A common stock for $16.5 billion YTD. Additionally, a $20 billion share repurchase program was authorized in April 2026.

Guidance, Outlook, and Risks

• Outlook: Management expects the shift toward digital commerce and electronic payments to continue. However, future volume growth depends on consumer spending levels and macroeconomic conditions. Exchange rate movements are expected to continue causing periodic variability in results.
• Liquidity: Visa maintains strong liquidity with $12.4 billion in cash and cash equivalents. The commercial paper program authorization was increased to $7.0 billion in July 2026.
• Legal Risks: Significant litigation remains a key risk factor.
  • U.S. Interchange MDL: Visa recorded an additional $1.1 billion accrual YTD and deposited $875 million into the U.S. litigation escrow account. Settlement discussions are ongoing, with final approval motions pending.
  • Europe Litigation: Over 1,200 merchants have commenced proceedings in the UK and other countries regarding interchange fees. Visa has settled claims with over 950 merchants, but over 100 claims remain outstanding.
• Regulatory Risks: New regulatory developments in Brazil may require Visa to extend settlement guarantees to sellers, potentially increasing settlement exposure and collateral requirements.

Investor Verification Checklist

• Litigation Escrow Balance: Verify the $888 million balance in the U.S. litigation escrow account and the adequacy of the $822 million accrued liability for U.S. covered litigation.
• Share Repurchase Authorization: Confirm the remaining $28.4 billion in authorized funds for share repurchases and the pace of future buybacks.
• Acquisition Integration: Monitor the integration progress and financial impact of the Prisma and Newpay acquisitions in Argentina.
• Client Incentives: Review the $13.2 billion in client incentives recorded YTD and assess the impact of future contract amendments on net revenue.
• Debt Maturities: Note the $1.5 billion principal payment due on senior notes in April 2027 and the company's liquidity position to meet this obligation.