Visa is learning that it its reunification with Visa Europe last summer came at a very good time.

Much of Visa's recent success can be attributed to "very healthy economies around the world," Visa CEO Alfred F. Kelly Jr. said April 20 during Visa's 2017 second-quarter earnings presentation. "It's very fortunate in every quarter to look across the globe and see very robust growth, and that's what we have seen."

Kelly acknowledged there is a considerable upside for the company to operate as "one Visa worldwide" as it continues to migrate to new commercial frameworks within Europe and establish its leadership team in that region. Kelly took over as CEO in December 2016 when Charlie Scharf resigned from the role.

Stack of Visa cards
Bloomberg News

In the second quarter, Visa delivered $430 million in net income, including factors related to reorganizing Visa Europe, and an adjusted net income of $2.1 billion excluding those factors. The company also enjoyed a 23% increase in net revenue to $4.5 billion, much of it fueled by renewed strength in Europe.

The benefits — and complications — of a single Visa operating globally dominated discussions during the earnings call, as the company has clearly put a sharper focus on where it stands in other global markets.

In that regard, Kelly said during the second quarter he visited with clients, investors, partners and government officials in places like Russia, Japan, China and India.

"My overall impression is that the Visa brand and our reputation with our clients is very good," Kelly said. "I validated what I already knew — that the payments space is a local business driven by history, tradition and local regulations. You must be local to win in the payments space."

In Russia, the focus was on continuing to establish strong relationships with bank partners and government officials, Kelly added.

"In- and out-bound travel in Russia has grown and contributes significantly to our cross-border business growth," Kelly said, as Visa continues to work as a complement to the country's domestic payment scheme.

Visa views upcoming sports events in Russia, such as the FIFA World Cup in 2018, as opportunities to extend its brand.

While in Japan, discussions centered on bringing more digital platforms to a country that remains "a huge cash society," Kelly said. "Enthusiasm for Visa is very high in Japan," he added. "I really believe Japan will take off over the next few years, driven by a positive and active government in terms of driving payments to more electronic and digital."

The 2020 Olympic Games in Tokyo will provide another opportunity for Visa to showcase its digital progress.

In India, which is seeking to minimize the use of cash, Visa is seeing strong growth in domestic, low-value debit transactions. "We are also scaling up physical and digital acceptance through bank partnerships," Kelly said. "Points of acceptance have increased 50% in the five months since demonetization, now above two million locations."

Success in other markets will make it easier for Visa to contemplate strategies with international areas it has to consider "unknown" at this point. One of those would be China, where Kelly said Visa continues to consider a "long-term opportunity" but has to be patient to determine how it will obtain a domestic license and what type of market share it can expect.

There is also a degree of uncertainty in how the PSD2 regulations in Europe, which essentially give third-party technology providers a bigger role in payments development, will affect Visa's dealings in the region.

Part of Visa's appeal in other markets will be its ability to deliver digital and security products. Two weeks before the earnings presentation, Visa revealed that its Visa Checkout one-click e-commerce solution has more than 20 million enrolled accounts.

Visa's growth plan for Checkout includes expansion this year in markets like Kuwait, Qatar, Saudi Arabia and Ukraine. If the company can make its e-commerce solution take hold in those markets, they would join the 21 other countries in which it already operates, including the U.S., Mexico, Argentina, Brazil, Canada, Chile, China, Colombia, France, Hong Kong, India and Ireland.

Visa also announced a PayPal partnership with Asia Pacific during the quarter, similar to the one it consummated in the U.S., with a focus on transaction and data sharing while expanding consumer choice. More recently, the company also announced the launch of enhanced transaction data capability for Amazon business customers in the U.S., Kelly noted.

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