(Mar 3): Visa Inc became the latest payments firm to face a hit from the spread of coronavirus.
The company warned that cardholders’ spending overseas has slowed sharply, especially for travel related purchases, and that this quarter’s revenue growth will be about 2.5 to 3.5 percentage points lower than the outlook it shared on Jan. 30. Visa said it won’t give a forecast for future quarters until its earnings call in April.
“Cross-border growth rates have deteriorated week by week since the coronavirus outbreak in China, and trends through Feb. 28, 2020, do not yet fully reflect the impact of the coronavirus spreading outside of Asia,” San Francisco-based Visa said in a filing Monday. “As such, we anticipate that this deteriorating trend has not bottomed out yet.”
Visa joins Mastercard Inc. and PayPal Holdings Inc. in warning investors about how the spread of coronavirus might impact their business. Mastercard said last month it’s knocking 2 to 3 percentage points off an earlier forecast, which translates to revenue growth of 9% to 10% on a currency-neutral basis, excluding acquisitions.
Cross-border e-commerce hasn’t been significantly impacted, except for travel spending and in some Asian markets, Visa said.
Visa shares, which jumped 5.8% on Monday, gave back some of those gains after the announcement, slipping 1.2% at 5:02 p.m. in late trading.