Visa announced that its cutting Q2 estimates due to lower credit card transaction volumes, as consumers are not spending due to the corona virus. In a statement on Monday, they stated, “As countries have imposed social distancing, shelter-in-place or total lock-down orders, domestic spending, most notably in travel, restaurants, entertainment and fuel, has sharply declined week on week,”. The company said transaction volumes fell in the second half of March and there has been a rapid deterioration in cross-border travel-related spending.
The coronavirus has upended the retail industry as shoppers stay at home to avoid catching the highly contagious illness and stores remain shut.
Mastercard Inc, American Express, and PayPal Holdings Inc have also warned of slowing revenue growth due to the outbreak.
Visa, which reported a 4% fall in March to date in U.S. payments volume from a year earlier, said it expects operating expense growth in high single digits and earnings per share growth in the high end of low single digits.
Analysts expect revenue of $5.83 billion and earnings per share of $1.36 in the second quarter ended March 31, according to Refinitiv IBES data.
Earlier this month, Visa had already warned that its second-quarter revenue growth would be slower than its previous forecast.
About The Author
Angela De Steffano
Staff writer at High Risk Merchant Account LLC
Angela is a merchant account specialist and heads the marketing team at HRMA-LLC.