Visa 4Q Profit Down 28 Percent on Large Tax Provision

(AP) -

Visa Inc.’s fourth-quarter net income fell 28 percent as it set aside money for taxes, and it said it’s making its plans based on a slow recovery of the U.S. economy.

The world’s largest processor of debit and credit card payments says payments on its system rose 13 percent, to $1.1 trillion, for the quarter. Visa’s results are closely watched because they can be a window into the buying habits and financial health of consumers.

The growth rate of the number of U.S. transactions slowed from August into September, showing constrained consumer spending, CFO Byron H. Pollitt said on a conference call. The company is assuming “a tepid recovery in U.S. economic growth,” he said.

Net income fell 28 percent to $1.19 billion, or $1.86 per share, for the three months that ended Sept. 30, from $1.66 billion, or $2.48 per share, last year.

The results topped analysts’ expectations by a penny, according to FactSet.

Revenue rose almost 9 percent, to $2.97 billion, a little less than the $3.02 billion analysts expected.

The company set aside $574 million for taxes, after benefiting from a $74 million tax gain last year.

Shares of Visa, based in Foster City, Calif., fell 42 cents to close at $203.82 on Wednesday. They dropped an additional $6.07, or 3 percent, to $197.75 after hours.