NEW YORK (AP) — Payment processing giant Visa said its profit dropped 75 percent in the fiscal second quarter from a year ago, largely due to the costs of integrating its recently acquired Visa Europe into the larger company.
The San Francisco-based company said Thursday it earned $430 million, down from $1.7 billion in the same period a year earlier. On a per-share basis, Visa earned 18 cents a share versus 71 cents a share a year ago.
Visa had two significant one-time charges on its books related to the legal organization of the company to include Visa Europe, which Visa Inc. purchased last year. Excluding those one-time items, Visa had an adjusted profit $2.1 billion, or 86 cents per share, which beat analysts' expectations.
The company continues to benefit from the increased adoption of plastic as a method of payment across the globe. All major geographic divisions of Visa reported greater usage of Visa's products in the quarter. The amount processed on Visa's network is closely watched by investors since the company charges a fee to a merchant each time a customer uses their Visa credit or debit card.
Visa processed $1.73 trillion on its credit and debit card network in the quarter, up 37 percent from a year earlier, but that increase includes the processing business of Visa Europe as well. In the U.S., where Visa does most of its business, the company processed $775 billion on its network in the quarter, up roughly 12 percent from a year earlier. Visa last year became the credit card processing company for Costco, taking that business away from American Express, which has helped it expand its total payment processing as well.
Total revenues at the company were $4.48 billion in the quarter, up from $3.63 billion a year earlier.