Visa Inc.

Welcome to Visa's fourth quarter and full year 2026 earnings conference call. All participants are in a listen-only mode until the question and answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host, Ms. Jennifer Como, Senior Vice President and Global Head of Investor Relations. Ms. Como, you may begin.

Thank you. Good afternoon, everyone, and welcome to Visa's fiscal fourth quarter and full year 2026 earnings call. Joining us today are Ryan McInerney, Visa's chief executive officer, and Chris Suh, Visa's chief financial officer. This call is being webcast on the investor relations section of our website at investor.visa.com. A replay will be archived on our site for 30 days. A slide deck containing financial and statistical highlights has been posted on our IR website. Let me also remind you that this presentation includes forward-looking statements. These statements are not guarantees of future performance, and our actual results, outcomes, or timing could differ materially as a result of many factors. Additional information concerning those factors is available in our most recent annual report on Form 10-K and any subsequent reports on Forms 10Q and 8K, which you can find on the SEC's website and the Investor Relations section of our website. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. Our comments today regarding our financial results will reflect revenue on a gap basis and all other results on a non-gap nominal basis unless otherwise noted. The related gap measures and reconciliation are available in today's earnings release and related materials available on our IR website. And with that, let me turn the call over to Ryan.

Thanks, Jennifer. 2026 was a milestone year for Visa. We finished the year with fourth quarter net revenue of $12.1 billion, up 13% year over year. This resulted in full year record net revenue of $46 billion, up 15%, the strongest net revenue growth in over 15 years, excluding the post-pandemic recovery and acquisitions. CMS revenue grew 19%, and VAS revenue grew 30%, both in constant dollars, and their revenue collectively represents more than 40% of our total net revenue. Our drivers for the year were strong. Payments volume was up 9% year-over-year in constant dollars. Commercial payments volume grew 12% for the year in constant dollars, faster than consumer and the fastest annual growth rate in eight years, excluding the post-pandemic recovery. Total cross-border volume excluding intra-Europe rose 12% year-over-year, with travel up 11% and e-commerce up 15% all in constant dollars. We process 281 billion transactions up 9% year over year and with approximately 80% processing penetration globally. And Visa Direct topped 15 billion transactions representing about a trillion and a half dollars in payments volume. While these numbers speak to our strengths, In 2026, we also demonstrated that whenever technology changes commerce, we move with it. We anticipate what's next, and we enable its growth as the leading hyperscaler of payments globally. The foundation of all of this is trust. Visa brings trust with our scale, our network and infrastructure, and our products, all delivered through our Visa as a Service stack. Starting with scale. We have scale in issuance and acceptance. In 2026, we had 5.2 billion credentials, up 6% year over year, with Latin America crossing the billionth credential milestone. And we continued to grow our credentials globally in a number of ways. We signed new co-brand agreements and expanded existing relationships with marquee brands around the world. In the hotel industry, this included Marriott in Samia, Asia Pacific, Latin America, North America. And in the airline industry, this included Air India in Asia Pacific, Copa Airlines in Latin America, Qatar Airways, and Ethiopian Airlines in Samia. We also had the launch of debit portfolios for Alaska Airlines and Southwest Airlines in the U.S. in addition to our existing credit portfolios with these brands. In the U.S., we added the new Samsung Galaxy card and maintained our leadership position with seven of the top 10 U.S. co-brands. In the affluent space, we recently launched our new Visa Infinite card series, signing with more than 70 issuers in over 40 countries in Q4 alone, with more than 15 issuers in Latin America, including Santander in Mexico, as part of an expanded relationship with Visa. Our Flex credentials have tripled since last year, with continued strength from existing players, as well as growth from new partners such as Cash App and Chime. We will also soon be launching the world's first stablecoin-linked Visa Flex credential with Norwegian Block Exchange, or NBX, in Europe. VisaPay, which connects wallets to any Visa-accepting seller worldwide, has nearly tripled its presence since last year to 11 countries. In commercial, we have over 15 new fleet clients this year across our five regions. We recently renewed our global agreement with WEX to enable B2B travel and solutions for their corporate clients. We also expanded our relationship from Europe to the U.S. with Audion for their travel clients. And through Visa's multinational program, New Line, by Fifth Third, will be enabling U.S.-based fintechs to offer Visa corporate cards in 46 countries. Across all of this credential growth, we continue to drive adoption of tokens. Today, over 50% of all available credentials are tokenized, more than doubling from five years ago. In 2026, we processed a tokenized transaction in 200 countries and territories for the first time. and now more than 60% of all e-commerce transactions are tokenized. On acceptance, we have well over 200 million seller locations driven by a more than 40% increase in Brazil, a more than 60% increase in Mexico and a more than 15% increase in India seller locations year over year. When we incorporate digital wallets, Visa credentials can be used at more than 200 million additional seller locations. So in total, Visa credentials can be used at more than 400 million seller locations. With this increased acceptance, Visa empowers buyers and sellers with secure ways to pay, such as with tap-to-pay, reaching nearly 85% penetration of face-to-face transactions globally. and with the final top 100 seller enabling tap to pay in 2026, we reached 75% penetration in the US, well our way to the global total. Tap to phone has driven new small business acceptance with more than 25 million active visa accepting mobile devices across more than 100 markets, surpassing more than 1 billion transactions in 2026 with 30% of Tap the Phone sellers new to our ecosystem this year. And for micro sellers in more emerging markets, we have Visa Accept, which has grown to 15 markets in just one year. Throughout all of these efforts, we are expanding our reach to power all types of payments, C2B, B2B, P2P, B2C, G2C, and more. In fact, we have the largest money movement platform on the planet with Visa Direct, as measured by transactions, volumes, and accounts, with more than 18 billion endpoints across cards, accounts, and wallets, up from 12 billion in 2025. Clients value the trust that this brings, and we have over 40 clients who each used more than five different Visa Direct use cases this year. A recent example of a client adding new use cases is Navy Federal, who we have already partnered with on cross-border remittances. And as part of a broader renewal across consumer and commercial portfolios and VAS, including DPS, they are positioning Visa Direct to support a number of new domestic money movement use cases over time. In addition, Wells Fargo has enabled Visa Direct for cross-border payroll, accounts payable, and disbursement payments. With our credentials, acceptance, and our reach, Visa has and will continue to bring scale to the ecosystem. You see this play out across our more than 200 countries and territories. For example, in Asia Pacific in 2026, we renewed and expanded with three of the top four Australian banks, three of the top four Indian banks, two of the top four Chinese banks, initiated new relationships with Japanese clients such as PayPay and Travel Wallet Japan. Visa also delivers trust through our network and infrastructure. Over the last five years, we have invested $15 billion in our network security and resilience, all to provide that six nines of reliability, always-on capability that you expect from Visa. And this year, we tested and strengthened our defenses through our Visa Vulnerability Agentic Harness, which we then open sourced to the world. We also made progress this year building the next generation of VisaNet to enable the future of commerce through a cloud-native, microservices-distributed, modular architecture that uses open languages and technologies, enabling easier scaling and configuration and faster feature deployments. Today, this supports live authorization traffic in production across markets in Latin America and Samia and powers additional payment processing workloads at a global scale. An important area of future development will be mainland China, as Visa has received approval of our application to prepare from the People's Bank of China. This significant milestone now marks the beginning of our formal preparations to ultimately process domestically on the Visa network. Another core aspect of our network and infrastructure is enabling new capabilities, including blockchain. In 2026, we gained even greater conviction in the opportunity and benefits of extending our network on-chain. Our vision is simple. One network combining fiat, stablecoins, and tokenized deposits with interoperability and utility across our infrastructure, bringing the same ease and trust clients expect for Visa. It requires key capabilities across the full on-chain stack, which we have made significant progress on this year. Specific highlights this quarter include, for the blockchain layer, we were invited to the founding validator cohort for Circles Arc, adding to our roles on Tempo as a validator and Kanton as a super validator. For the issuance layer, OpenUSD went live on September 30th, with total supply and circulation surpassing $800 million so far through October 15th. In the orchestration layer, Visa Direct's stablecoin pre-funding and cross-border money movement has moved from pilot to commercial production, and we have our first live partner, Inyo Global, a U.S.-based payments infrastructure provider. In the application layer, Our Visa Stablecoin platform is now available in the U.S., Mexico, Puerto Rico, Colombia, Switzerland, and the U.K., with additional countries to follow, and the pipeline has more than 300 partners. And the engagement we are seeing with our more established stablecoin offerings is significant. In stablecoin settlement, our run rate has surpassed $25 billion in annualized volume, up 10x year over year. We can now support 10 blockchains, more than doubling from last year and are operating in all five regions. In consulting, with over 60 unique engagements, Stablecoin Advisory was our fastest growing Visa consulting and analytics practice this year with nearly half of these projects in Q4 alone. And it continues to be among the top three focus areas for our clients alongside AI and cybersecurity. We now have over 225 Stablecoin-linked card programs up more than 70% year over year with 150% plus growth in volume across 5 million cards in more than 50 countries with issuers across crypto exchanges, neobanks, wallets, and remitters. That is trust at scale. And the trust that the Visa network and infrastructure represent is only amplified by the products we provide on top of it. I spoke last quarter about the fundamental changes to the way that we build and ship products enabled by utilizing our agentic toolchain. For example, the Visa Stablecoin platform enablement for OUSD was designed, built, and shipped in seven weeks with 12 people. This would have taken much, much longer and required many more people without utilizing our agentic toolchain. Today, more than 60% of our global product development and engineering teams have adopted this new way of working with the intent of reaching 100% this year. One of the key areas of innovation for Visa has been empowering agentic commerce. It is clear that an agentic trust is the biggest barrier to scale. We believe the best way to break through that barrier is with one simple but powerful idea. Every time someone pays or gets paid, it's with a Visa credential. And as we look at the albeit limited number of agentic transactions today, Visa credentials are being used by consumers, businesses, and agents. We have nearly 50 AI partners live and in production, including more recently Shopify's ShopPay, with that number expected to double in the coming months. We are also collaborating with Anthropic to bring their commerce blueprints to our merchant network. combining the intelligence of Claude with the trust, security, and global reach of the Visa network. One of the areas we have identified for fast adoption of agentic has been B2B, and we have had several partners launch and expand offerings. RAMP's agentic bill pay use case is now generally available, and as RAMP businesses use Visa Intelligent Commerce to automate bill payments, payments volume is growing. Airwallex is testing Visa Intelligent Commerce enabled credentials and integrating them into their native wallet, Airy. Bill's payment agent is piloting Visa Intelligent Commerce to pay invoices and Bill Trust supplier portal will identify the agent and accept payment. Our Visa Intelligence Commerce solution is enabling all of this. It provides trust for the user, with credentials, agentic tokens, and transaction identifiers, trust for the agent with the trusted agent protocol and agent directory, and trust for the transaction. Once we have verified the user and agent identity, we need to make sure that the purchase instructions are clear by capturing consumer authenticated intent. And of course, Like on any Visa transaction, our rules clarify the roles and responsibilities and processes should something go wrong. It is clear that agentic commerce is here and Visa's role is clear, delivering trust. Another important area of product development has been in our value-added services. In fiscal 2026, our VAS business grew revenue 30% in constant dollars to $14 billion, essentially double our 2023 VAS revenue. Our issuing, acceptance, and risk and security portfolios collectively grew more than 20% in constant dollars this year, a growth rate we believe is sustainable in 2027 for two primary reasons, the underlying drivers of revenue and demand from clients. I'll go deeper into each one. First, transactions, cards, and accounts had driven the vast majority of our VAS revenue, more than 80% over the last five years, and that will continue as our clients grow, we expand to new clients and develop new products and we're able to price those products to value. For example, Pismo signed clients in Sweden, Belgium and Guatemala this quarter, bringing the total for the year to 28 countries, almost doubling from last year. Our success has enabled us to sell more products fueled by these underlying drivers. Now to demand. Cyber-related products are a top priority for our clients. We offer many end-to-end cyber solutions, including several launched this year, and we will continue to invest more over time. The associated revenue spans across the VAS portfolios and represents a meaningful amount of total VAS revenue. We deliver these cyber solutions in four areas, all bringing trust to the ecosystem. One, helping our clients collect threat intelligence and detect cyber problems early. Two, protecting our client's security perimeter with identity access and behavioral trust solutions. Three, ensuring every transaction on and off the Visa network is safe with transaction intelligence solutions. And four, when an active threat does emerge, enabling our clients to maintain service resilience and recover as quickly as possible. In threat intelligence, our Visa Threat Intelligence platform combines cyber, fraud, brand, identity, and financial crime insights through high fidelity feeds. We connect these indicators to potential fraud outcomes to help our clients defend against would-be attackers. We also recently invested in Overwatch Data, a financial threat intelligence company whose solutions we will soon be offering to our clients globally. In identity access and behavioral trust, our authentication and tokenization platforms protect consumer credentials, payment transactions, and merchants and acquirers' sensitive data. And we are excited about our pending acquisition of BioCatch, a leading provider of behavioral-first Thank you for joining us today. We are enhancing our scaled transaction risk services like Visa Advanced Authorization and Visa Decision Manager with our large transaction model. And our feature space solution offers clients a flexible platform to integrate a wide range of risk signals to enrich risk decisions throughout the consumer journey. And in recovering resilience, smarter stand-in processing enables clients to deliver seamless, resilient transaction authorization services, and the newly launched Visa Intelligent Authorization empowers acquirers with advanced processing, payment orchestration, risk settings and real-time data across multiple local and global payment methods. Of course, this list is not exhaustive. And with all of this, we offer our Visa cybersecurity advisory practice to help clients review, design and select the best solutions for them. Our advisory and other capabilities had significant revenue growth this year with successful activation around the Olympics and FIFA and also around other sponsorships in sports and music and our other highly valued consulting engagements. These underlying set of assets and capabilities in this portfolio will drive strong revenue growth well into the future. Across all our value-added services, we have the people, technology, data, brand assets, and reach that our customers are looking for. That is what drove the 30% VAS constant dollar revenue growth in 2026 and is why we expect strong VAS growth in the low to mid 20s in 2027. 2026 was a historic year for payments. and Visa only strengthened our positioning in the ecosystem as the leading hyperscaler of payments globally. We demonstrated our ability to significantly accelerate product development with the true birth of tokenized agentic commerce transactions powered by Visa, with blockchain infrastructure and platforms designed for payments, with the increased utilization of AI across our business to deliver over 350 product releases up 25% year over year. We reached new customers with Tap to Phone, Pismo, our B2B travel and fleet offerings, new affluent solutions, and cyber and risk capabilities like Feature Space and A2A Protect. And with the first transaction in Syria in well over a decade. We delivered secure, reliable payments, nearly 9,000 transactions per second in over 200 countries and territories every day, up 9% year-over-year. We brought the best of Visa technology to the world for free with the Visa Vulnerability Agentic Harness. All of this was possible because of what Visa and our brand stand for. Every day, across more than 200 countries and territories, over 18 billion endpoints, and more than 400 million seller and wallet locations, across consumers, businesses, governments and agents, trust enables all of this. We've seen meaningful growth acceleration this year, and as I look ahead to 2027, one thing is clear. Trust is the next growth vector for Visa. Trust fuels everything we do at Visa every day, and trust will fuel our future. For more on our 2026 performance and our thoughts on 2027, I will hand it over to Chris.