V/MA: What's on Tap for C2Q26?

Research evidence excerpt

V/MA: What's on Tap for C2Q26?

V/MA: What's on Tap for C2Q26? Equity Research

Recap of guidance commentary from F2Q call

• On its F2Q26 call, V raised its organic const-curr F26 net revs growth outlook to LDD to low-teens

(vs. low DD prior), incorporating YTD outperformance, updated assumptions for key drivers, and

expected higher value-added services revenue growth (FIFA World Cup). On a reported basis, V is

guiding to F26 net revs growth of low-teens (inclusive of 0.5% FX tailwind and ~1.0% tailwind from

acquisitions), vs. WFS/Street=13.8%/13.9%.

• V's guide assumes overall consumer spend stability continues. While the Middle East conflict has

introduced some near-term uncertainty, V expects improvements in US and Latin America inbound

travel due to FIFA and easier comps from lapping impact of low US inbound growth from last year

(Exhibit 1).

• V did not make material changes to its pricing assumptions: new pricing is expected to go into

effect in F2H26.

• V did not make material changes to its incentives assumptions. V expects a step-up in incentive

growth rate from F2Q to F3Q as it laps a low point for incentives growth in F3Q25.

• V cited that FX volatility was higher than expected in F2Q and F3QTD (through 4/28). As such, V

increased its FX volatility assumptions to where it had originally guided in October, with F3Q/F4Q

expected to be more in-line with where V exited in F4Q25.

○ Recall on its F4Q25 call, V had expected volatility throughout F26 to be generally consistent

to where V exited F4Q25. However, in F1Q26, V saw much lower-than-expected volatility and

assumed that volatility would continue at current lower levels for the rest of the year.

• On the F2Q call, V ticked up its organic F26 operating expense growth guide to "LDD to low-teens"

vs.