Visa profit rises 30 percent as card use rises

NEW YORK - Visa said Wednesday that its profit for the first three months of the year was up 30 percent from the year before, primarily because credit card use rose in the United States and overseas.

The company said Americans rang up 12 percent more on their charge cards for the quarter. Debit card use grew by only 4 percent, however, the slowest growth in a year.

Banks have eliminated some debit card rewards programs since October, when the government limited the fees banks can charge stores for card transactions.

Like MasterCard, Visa makes money by processing card transactions for banks and other issuers.

For the quarter, Visa said its net income was $1.3 billion, or $1.60 per share. Wall Street was expecting $1.51. Revenue rose 15 percent to $2.6 billion. Wall Street was expecting $2.48 billion.

Visa stock climbed more than 3 percent in after-hours trading.

Visa's international customers, like MasterCard's, increased their spending at a faster rate than Americans. International transaction revenue grew by 17 percent.

Visa increased its incentives to clients in the quarter to $497 million from $451 million. Those incentives represented 16 percent of its revenue, compared with 24 percent for MasterCard's.

The incentives are a common competitive practice in the card industry. Processors like Visa offer breaks to banks and other card issuers to persuade them to switch the logos on the cards they offer their customers.

For the year, Visa said it expects revenue growth in the double digits and does not plan to cut incentives, which will remain in the range of 17 to 18 percent of total revenue.