Visa Inc. (NYSE:V) Q1 2024 Earnings Call Transcript

Visa Inc. (NYSE:V) Q1 2024 Earnings Call Transcript January 25, 2024

Visa Inc. beats earnings expectations. Reported EPS is $2.41, expectations were $2.33. Visa Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Welcome to Visa’s Fiscal First Quarter 2024 Earnings Conference Call. All participants are in a listen-only mode until the question-and-answer session. Today’s conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host, Ms. Jennifer Como, Senior Vice-President and Global Head of Investor Relations. Ms. Como, you may begin.

Jennifer Como: Good afternoon, everyone, and welcome to Visa’s Fiscal First Quarter 2024 Earnings Call. Joining us today are Ryan McInerney, Visa’s Chief Executive Officer; and Chris Suh, Visa’s Chief Financial Officer. This call is being webcast on the Investor Relations section of our website at investor.visa.com. A replay will be archived on our site for 30 days. A slide deck containing financial and statistical highlights has been posted on our IR website. Let me also remind you that this presentation includes forward-looking statements. These statements are not guarantees of future performance and our actual results could differ materially as the results of many factors. Additional information concerning those factors is available in our most recent Annual Report on Form 10-K and any subsequent reports on Forms 10-Q and 8-K, which you can find on the SEC’s website and the Investor Relations section of our website.

For non-GAAP financial information disclosed in this call, the related GAAP measures and reconciliation are available in today’s earnings release and related materials available on our IR website. And with that, let me turn the call over to Ryan.

Ryan McInerney: Hi, everyone. Good afternoon and thank you for joining us. We are off to a solid start in 2024. Consumer spending remained resilient with first-quarter year-over-year payments volume growth at 8%. U.S. payments volume grew 5% year-over-year. International payments volume grew 11%. Cross-border volume excluding intra-Europe rose 16% year-over-year in constant dollars with cross-border travel at 142% of 2019 levels, up from 139% in the fourth quarter. Processed transactions rose 9%. Our net revenues increased 9% with GAAP EPS up 20% and non-GAAP EPS up 11%. As I reflect on the execution of our strategy this quarter across consumer payments, new flows and value-added services, I wanted to highlight a few key themes.

One, we remain obsessed about serving our customers including traditional bank partners, neobanks, fintechs, wallets, sellers, acquirers and everyone else. Our focus on clients has enabled us to deepen our relationships with partners across all three pillars of our strategy. Two, we continue to seek new partnerships, new use cases and new verticals to drive our business forward with a particular emphasis on cross-border. Three, we have gone to market with innovative solutions across our network of networks, seeking to add value for all transactions, no matter the network. And four, we are always looking for new and innovative ways to amplify our brand in service of our partners. With those themes in mind, let me provide some more details on the quarter.

Let’s start with consumer payments. We saw continued growth in credentials, acceptance and engagement. Credentials grew 6% and we now have more than 8.7 billion network tokens, up 55%. Acceptance locations grew 17%. And let me highlight two recent examples of where we have expanded acceptance. The first was in Brazil with Caixa for cash conversion at their over 10,000 lottery branches. They are now accepting Visa credit and debit cards to pay for utilities, tax collection, lotteries and voucher payments which are called boletos. Another example was in Asia-Pacific where we signed an agreement with Bcash, the largest mobile financial services player in Bangladesh. Already a client with Visa Direct, they now have enabled Visa’s 15 million plus cardholders in the country to use their in-app QR code to pay at more than 550,000 Bcash merchants.

These examples demonstrate our local approach to expanding our global acceptance footprint. Tap to pay grew five percentage points from last year to 77% of face-to-face transactions globally, excluding the U.S. In the U.S., we reached 45% penetration. One highlight from the first-quarter is that Lowe’s has enabled tap to pay acceptance. We believe the tapping provides the best buyer and seller experience in the face-to-face environment and we’ve seen that play-out in the results. In a recent Visa study in the U.S., we saw on average two more transactions a month and spend lift of $70 a month for those who tap with a Visa debit card versus those who don’t tap. Now on to some noteworthy updates from the quarter, which demonstrate our ability to deepen and expand partnerships as well as create new ones.

In Europe, we renewed our agreement with isbank, the largest private bank in Turkey with 33 million cards for its consumer and commercial credit and debit portfolios. As part of that renewal, they will be issuing the first Olympic and Paralympic Games credit card in Europe outside of France, leveraging our sponsorship. In Poland, we signed a new issuing agreement with PKO Bank Polski, the largest issuer and acquirer in Poland and Central Eastern Europe for consumer and commercial debit. In Greece, we expanded our partnership with Piraeus Bank, the largest bank in the country to become their exclusive payment network across their consumer and commercial credit and debit portfolios. These are all fantastic examples of the attractive position and strong pipeline in Continental Europe I spoke about last quarter.

In Japan, we expanded our credit issuance partnership with e-Pass, one of the fastest-growing issuers in the country, affiliated with department store Marui. They will use Visa Managed Services, which is a part of our advisory solutions where we embed Visa employees within a client organization to help execute against key initiatives. In Korea, we renewed and expanded our partnership with Shinhan Card, the largest issuer in the country for a consumer and commercial credit and debit. Shinhan has also committed to utilizing a suite of Visa’s value-added services, including consulting and marketing to advance their business. In Mexico, we renewed our agreement with BBVA across consumer and commercial credit and debit along with value-added services, including risk, advisory and data tools.

And last, in the U.S., we extended our agreement with Bank of America for multiple value-added services, including visas loyalty platform service, CardinalCommerce 3D secure service, Verifi Order Insight digital service and DPS debit processing. We also continue to be a partner of choice for fintechs around the world. First, in the U.S., we renewed with leading fintech chime, further debit and credit builder secured card portfolios as well as for Visa Direct. In Latin-America, we renewed our debit and credit contracts with Rappi, one of the largest fintech and merchant clients in the region with more than 30 million customers. They will also utilize numerous value-added services, including CyberSource and Decision Manager. And finally, we are excited about a new global partnership with HSBC for their fintech initiative Zing.

Starting with the U.K., we are supporting the ambition to launch this multi-currency proposition in more than 30 markets. Visa’s capabilities through Tink, currency cloud and our consumer payment solutions offer a powerful customer proposition and rapid deployment for Zing and HSBC. Through these renewals and new partnerships, you can see how we are focused on building a deep relationship across all the capabilities Visa offers. Now moving to new flows. We have updated our sizing of the new flows opportunity using the latest market data available. Excluding Russia and China, we see $200 trillion of opportunity annually across B2B, B2C, P2P and G2C, certainly an enormous number. We are working with our clients to deliver Visa’s commercial and money movement solutions to help digitize these flows on our network of networks.

Starting with Visa Direct. Total transactions this quarter grew 20% to $2.2 billion. And on the P2P cross-border front, transactions grew more than 65% year-over-year. In terms of client highlights for this quarter, we have been developing partnerships for new use cases in verticals and we are continuing to drive cross-border volumes. First, in new use cases, in addition to our existing P2P partnership in the U.S., we have expanded our Visa Direct relationship with Meta, launching the ability for content creators on Meta’s family of apps to cash out their earnings to a debit card. This launch, now live in the U.S., U.K., France and Italy, allows for creators to receive their payout quickly and safely. Second, on cross-border volumes, we have continued to make progress in enabling global money movement across our 8.5 billion endpoints in nearly 200 countries and territories.

Western Union is a great example. We just signed a long-term global partnership agreement with Western Union covering issuance, Visa Direct and other services across 40 countries in five regions. This long-term collaboration will bring product innovations and digital-first customer experiences to enhance cross-border money movement. We also expanded our relationship with Remitly to enable customers from 30 countries to send cross-border payments to eligible debit cards and bank accounts in over 100 countries globally. In Canada, we recently announced our agreement with CIBC and Simplii to provide millions of clients the ability to send money to digital wallets in key remittance destinations including the Philippines, China and Bangladesh. On to the commercial side, total payments volume grew 8% in constant dollars.

And throughout the quarter, we continued to focus on new verticals. Let me highlight a few specific areas. First, in the cross-border travel vertical, we recently expanded our agreement with Singapore based B2B platform Nium. Their virtual card B2B travel program will expand from the U.S. and Europe into Australia, Singapore, Hong-Kong and Japan. Also in B2B travel, we signed a new virtual card agreement with Worldline, a leading global payment provider for travel intermediaries to pay their suppliers more quickly. In the contractor vertical, we recently signed an agreement with United Overseas Bank and Doxa, a Singapore fintech for contractors. In partnership with Visa, the Doxa platform has further been enhanced to provide embedded financing capabilities.

Subcontractors will be given the option to be paid for their services through UOB virtual cards. And also with UOB, we renewed and expanded our commercial relationship across commercial debit and credit including the enablement of payment flows for the Singapore government. Let me move on to value-added services. Our network of networks strategy is also playing a key role in value-added services. As a reminder, this has three components. One, moving money to all end-points and to all form factors. Two, using all available networks and being a single connection point for our partners. And three, providing our value-added services on all transactions, no matter the network. We have continued to develop and expand our value-added services as part of this strategy.

Let me cover three recent examples. Processing capabilities for RTP networks, Pismo and Prosa. Last quarter, I noted that Visa is becoming a certified service provider for FedNow, enabling financial institutions to receive funds through the FedNow service. We have now enabled the ability to also send funds. The second example is Pismo, which we just closed last week. As I talk to clients around the world, particularly issuing clients, there are two priorities that are increasingly on the minds of CEOs. The first is for many of our issuing clients, they’ve either recently embarked on or they’re considering embarking on a transformation of their tech-stack from their legacy infrastructure to cloud-native API-based tech stacks. The second is that many clients, whether they’d be traditional issuers or fintechs, are increasingly looking to rapidly expand their issuance to new regions and countries, especially the more developing markets around the world.

Our clients are looking to Visa to help them with both of these priorities. And with Pismo, we will be able to deliver to our clients the best cloud-native issuer processor in core banking platform in the world. Pismo offers global core banking and multi-product issuer processing covering credit, debit and commercial with connectivity to local payment networks such as Pix. Our goal is for Pismo to be the platform of choice for our issuing partners around the world, enabling them to accelerate their global expansion and transition to cloud-native platforms. And the third example of our network of networks is our announcement to acquire a majority interest in Prosa, a payments processor in Mexico. A couple things about the Mexican market. One, cash and check represent more than 50% of personal consumption expenditures.

And two, today Visa has limited ability to process domestically. We believe we can bring enhanced technology infrastructure and lay the groundwork to develop new innovative ways for consumers, small businesses and local issuers and acquirers in Mexico to pay and be paid. This includes improving safety, security and reliability and providing better experiences through our value-added services such as tokenization, risk products and more. We can also bring our innovation and commitment to continued investment for both face-to-face and online transactions. Together, these efforts will help further digitize payments in the country. The investment is subject to regulatory review and we hope to close in the second-half of calendar year 2024. And finally, I want to highlight the opportunities to drive further growth in value-added services via the development of new partnerships.

These enable us to enhance our overall offering and distribution reach. Yesterday, we announced an agreement with digital workflow leader ServiceNow to build solutions and distribute Visa’s products and solutions to joint customers. To start, ServiceNow will launch in end-to-end disputes management solution for issuers with plans to expand to additional segments and products over-time. This partnership showcases the demand for our value-added services and provides a compelling distribution channel to reach more customers around the globe. So, across consumer payments, new flows and value-added services, you can see the enormous opportunity as well as Visa strong relationships, commitments to our clients and innovation in new ways to pay and be paid.

What helps to amplify all of these efforts is our brand. We recently renewed our long-standing partnership with FIFA, creating a powerful opportunity to drive business for both Visa and our clients, improve brand lift and maximize global reach. Not to mention, providing an opportunity to showcase and implement Visa’s innovative payment technology. We’re also launching our first new global sports sponsorship in more than 15 years with the Red Bull Formula One teams. The partnership aligns our brand with two teams within Formula One which is one of the fastest-growing sports on the planet, providing another opportunity to drive business for our clients. As we look ahead this year, we’re excited to be activating our brand with our clients across all of these partnerships as well as the Olympic and Paralympic games in Paris.

Before I hand it over to Chris, I wanted to mention that we hold our Annual Meeting on Tuesday. All of the proposals that the Board recommended past including the exchange offer program proposal. As such, we will be moving promptly to file an S-4 with the SEC relating to the initial exchange offer. I also wanted to give a special thanks to my colleague, partner and friend, Alf Kelly, as Tuesday he officially retired as Executive Chairman. Alf, on behalf of the entire Visa family, thank you for your exceptional leadership. You led this business to incredible heights, while also driving innovation, deepening our client relationships and strengthening our culture in so many ways. Your impact on Visa will be visible for generations. In closing, in the first-quarter, Visa once again demonstrated the effective execution of our strategy across the globe.

While uncertainty seems to be the norm, Visa has the experience and discipline to manage through the challenging environments and I remain optimistic and confident about our future. Now over to Chris.

Chris Suh: Thanks, Ryan. Good afternoon, everyone. As Ryan said, Q1 was a solid quarter with relative stable-growth in overall payments volume and processed transactions and strong growth in cross-border volume. Looking at our drivers, in constant dollars, global payments volume was up 8% year-over-year and processed transactions grew 9% year-over-year. Cross-border volume growth excluding intra-Europe was up 16% year-over-year in constant dollars. Fiscal first-quarter net revenues were up 9% in nominal and constant dollars, which was on the high-end of our expectations, primarily due to lower-than-expected incentives and less FX drag. GAAP EPS was up 20% and non-GAAP EPS was up 11% in nominal and 10% in constant dollars. Now on to the details, starting with the U.S. U.S. payment volumes grew 5% year-over-year, credit grew 6% and debit grew 5%.

Card-present spend grew 3% and card not present volume grew 7%. As we look at the monthly total U.S. payments volume growth rates throughout the quarter, we saw low in October and a peak in November with December in between. Putting it all together, the step-down of about 80 basis-points in total US payments volume growth from Q4 to Q1 was primarily due to a less favorable mix of weekends and weekdays compared to last year and a combination of a few small items, including a softer October and modest impact from Reg II. Consumer spend across all segments from low to high spend has remained relatively stable. Our data does not indicate any meaningful behavior change across consumer segments. Moving to holiday spend, which is the period from November 1 to December 31.

In the US, consumer holiday spend growth was in the mid-single-digits on a year-over-year basis. Consumer retail spending growth was similar to last year. However, retail spending growth on key shopping days from Thanksgiving to Cyber Monday was much stronger. E-commerce increased its share of retail spending versus last year. Moving to international markets, where total payments volume growth was up 11% in constant dollars, stable to Q4. Payments’ volume growth rates were strong for the quarter in most major regions of Latin-America, CEMEA and Europe ex-U.K. each growing about 20% in constant dollars. Now on to cross-border, which I’ll speak to in constant dollars and excluding intra-Europe transactions. Total cross-border volume was up 16% year-over-year.

Cross-border card-not-present volume growth excluding travel grew slightly faster-than-expected in the low-teens adjusted for cryptocurrency purchases. Cross-border travel-related spend grew 19% year-over-year. The cross-border travel volume index to 2019 increased from 139% in Q4 to 142% in Q1. Travel volume into Asia indexed at 132% of 2019 levels for the quarter, up three points from Q4, while travel volume out of Asia was up four points to 118%. This was lower than last quarter’s expansion, primarily due to relative weakness in Australia and Japan. Travel in and out of Mainland China continued to improve, but both remain below 2019 levels. U.S. travel inbound continued to improve several points from Q4 versus 2019 levels. And we continued to see healthy travel volumes in and out of LAC, Europe and CEMEA and out-of-the US, ranging from 145% to 170% of 2019 levels.

Now let’s review our first-quarter financial results, starting with the revenue components. First, as any new pricing usually goes into effect in April and October, this quarter, each of our revenue components benefited as a result and the growth rates were either further enhanced or offset by the additional factors as follows. Service revenues grew 11% year-over-year versus the 9% growth in Q4 constant dollar payments volume with some additional help from card benefits. Data processing revenues grew 14% versus 9% processed transaction growth, helped by business mix and value-added services. International transaction revenues were up 8% versus the 16% increase in constant dollar cross-border volume, excluding intra-Europe, impacted by lapping strong currency volatility from last year.

Other revenues grew 18% with strong consulting revenue growth, but impacted by lapping 31% growth from 2023, primarily from FIFA related value-added services revenue. Client incentives grew 20%, but ended-up lower-than-expected due to client performance and deal timing. Across our three growth engines, consumer payments growth was driven by relative stability in payments volume growth and processed transactions as well as strong growth in cross-border volume. This quarter, in new flows, the underlying drivers remained relatively stable. Commercial volumes rose 8% year-over-year in constant dollars and Visa Direct transactions grew 20%. Total new flows revenue grew in the low-single-digits year-over-year in constant dollars due to several one-time items and business mix impact.

As you know, for any given period, there can be puts and takes, but most importantly drivers are stable and we continue to expect full-year 2024 new flows revenue to grow faster than consumer payments revenue. In Q1, value-added services revenue grew 20% in constant dollars to $2.1 billion with strength and issuing and acceptance solutions. GAAP operating expenses declined 6%. The decrease in expenses was driven by a decrease in the litigation provision, somewhat offset by an increase in personnel expenses. Non-GAAP operating expenses grew 7%, primarily due to an increase in personnel expenses. Excluding net gains from our equity investments of $4 million, non-GAAP non-operating income was $84 million. Our GAAP tax-rate was 19.1% and our non-GAAP was 19%, helped by larger-than-expected tax benefits.

GAAP EPS was $2.39; non-GAAP EPS was $2.41, up 11% over last year, inclusive of an approximately 0.5 point benefit from exchange rates. In Q1, we bought back approximately $3.4 billion in stock and distributed over $1 billion in dividends to our stockholders. At the end of December, we had $26.4 billion remaining in our buyback authorization. Now let’s move to what we’ve seen so far in January through to the 21st. U.S. payment volume was up 4% with debit up 3% and credit up 4% year-over-year, down from December, largely due to severe weather conditions in parts of the U.S. Process transactions grew 8% year-over-year. Constant dollar cross-border volume, excluding transactions within Europe, grew 16% year-over-year. Travel-related cross-border volume, excluding intra-Europe, grew 16% year-over-year or 146% indexed to 2019; and cross-border card-not-present ex travel grew 16%.

Now on to our expectations. Remember that adjusted basis is defined as non-GAAP results in constant dollar and excluding acquisition impacts. You can review these disclosures in our earnings presentation for more detail. For the full year, we have no material changes to our prior outlook for drivers, adjusted net revenues or EPS growth. Remember that our drivers assume no recession or a further increase in Reg II impacts. Pismo is expected to have minimal benefit to full year net revenue growth and an approximately 0.5 point headwind to non-GAAP operating expense and EPS growth. FX is expected to have an approximately 0.5 point drag to net revenues growth and approximately 1 point benefit to non-GAAP operating expense growth and a minimal drag to non-GAAP EPS growth.

Non-GAAP non-operating income is expected to be between $350 million and $400 million, with nearly half in Q2 due to the resolution of some non-U.S. tax matters. Putting it all together, adjusted net revenues growth is unchanged at low-double-digits, adjusted operating expense growth is updated to low double digits, and adjusted EPS growth is unchanged at low-teens. For the second quarter, similar to the full-year, Pismo is expected to have a minimal benefit to net revenues growth and an approximately 0.5 point headwind to non-GAAP operating expense and EPS growth. FX is expected to have minimal drag to net revenues growth and an approximately 0.5 point benefit to non-GAAP operating expense growth and minimal benefit to non-GAAP EPS growth.

We expect adjusted net revenues growth in the upper mid to high-single-digits and adjusted operating expense growth in the low-double-digits, north of 10%. Nonoperating income is expected to be highest in Q2 due to the resolution of some tax matters, as I noted earlier. As such, the tax rate is expected to be between 16% and 16.5% in Q2 with the full-year unchanged. This puts second quarter adjusted EPS growth in the high-teens. In summary, we’re off to a solid start in the first quarter. The fundamental drivers remain relatively stable, and with no material changes to our full year guidance, we remain focused on the execution of our growth strategy for the rest of 2024. As always, if the environment changes and there’s an event that impacts our business, we will, of course, adjust our spending plans.

We remain thoughtful on balancing between short- and long-term considerations. And now Jennifer, let’s go to Q&A.

Jennifer Como: Thanks, Chris, and with that, we’re ready to take questions.

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Q&A Session

Operator: [Operator Instructions] Our first question comes from Tien-Tsin Huang with JPMorgan. Your line is open.

Tien-Tsin Huang: Hey, thanks so much. Just want a clarification and a bigger question here. Just on the clarification, the new flows up low single digits versus mid-teens last quarter. How did that come in versus plan? Were there some onetime issues? Because it sounds like the other metrics were in line. And then my question was just on U.S. volume running in the mid-single-digits here, it’s pretty tight to PCE. I know there are a lot of factors like gas and e-com and Reg II, but just can you clarify your view on U.S. volume here in relation to PCE growth in the short to mid-term? Thank you.

Ryan McInerney: Tien-Tsin, it’s Ryan. Why don’t I start on the second part of your question and then Chris can answer the first part and add or correct any on the second part. I think let’s back way up for a second in the U.S. U.S. remains a significant opportunity for us in consumer payments. I mean, there’s still a lot of cash, a lot of checks, a lot of ACH. We’re having great work with fintechs and banks to bring more people in on the carded front. We’re doing work to expand acceptance, the service industry, whether it’s plumbers or contractors, charities, vending, parking, tap to pay. I mean, we continue to be very, very excited about the U.S. market. I think as you said, and Chris can add some detail, in the quarter, there’s some Visa-specific factors on the growth rate in the U.S. as it relates to PCE, like you were talking about.

But as we look forward, it continues to be a big opportunity for us. We continue to be excited about it. Chris, do you want to take the first part of Tien-Tsin’s question and add anything on the second?

Chris Suh: Sure. Yes, in new flows, so the underlying fundamentals of our commercial business remain sound. Commercial payment volumes grew 8% and Visa Direct transactions grew 20%. And importantly, the new flows business continues to be a growth engine for Visa. We do expect the full-year revenue growth to exceed consumer revenue growth. Now specific to your question around the first quarter, it was impacted by a couple of factors: first, the mix of business, with cross-border volume growth slowing in Q1 as travel continued to normalize; and second, the growth was also impacted by a few onetime items that happened to be larger than we might typically see in any given quarter. But all in all, we feel great about the business and the long-term growth trajectory ahead.

Tien-Tsin Huang: Cool, that’s helpful. Thank you both.

Jennifer Como: Next question, Jordan.

Operator: Our next question comes from Dan Perlin with RBC Capital Markets. Your line is open.

Dan Perlin: Thanks. I just wanted to ask a question around the new partnerships within value-added services. Ryan, it sounds like, as part of the priorities, you want to get value-added services on all the networks. And I think you were alluding to the fact that this is going to be maybe a bigger shared responsibility with this partnership growth, and ServiceNow is obviously a great example. But I’m just trying to reconcile kind of how we should be thinking about Visa maybe opening up those opportunities with these two partnerships and what that may do at some point to the financial picture of the company? Thanks.

Ryan McInerney: Yes. Again, if I back up before I answer to the specific question about ServiceNow and partners, we’re very excited about the progress that we’ve made on our value-added services strategy. We’re excited about the momentum that we’re seeing kind of in the market. We’re excited to see our sales efforts really driving success and performance across issuing, acceptance, risk and identity, advisory and open banking. And it’s exactly as you were saying with partners like ServiceNow. What we’re finding is we can have great efforts selling to our partners directly around the world. But we’re also getting a lot of demand from various different platforms that already have relationship with thousands or tens of thousands or, in some cases, more customers in any one country or region.

And they’re very excited to sell through our value-added services as a way of differentiating their platform and deepening relationships with their users and their customers. And so in the example of ServiceNow, they had been talking to their bank clients, and their bank clients had asked for and been interested in some of the dispute services that we provide. And so we’re going to market first, as I said in my prepared remarks, with our dispute services via ServiceNow. We’ve got a pipeline of other products and services that we’re working with them on. And we’re deep in discussions with other platforms around the world about bringing our money movement solutions and our value-added services solutions as a way to differentiate their platform and add value to their users.

Jennifer Como: Next question, Jordan.

Operator: Our next question comes from Craig Maurer with FT Partners. Your line is open.

Jennifer Como: Craig, are you there?

Craig Maurer: Yes. Sorry, can you hear me?

Jennifer Como: We sure can.

Craig Maurer: Okay. Great. I wanted to ask if you can be a little bit more detailed in the comments around Reg II and how you’re seeing volume move perhaps off your network. And second, if you can just add some detail around the onetime items that impacted Visa in the U.S. in the quarter, I’d appreciate it.

Ryan McInerney: So let me talk a little bit about the business aspect of Reg II, and then Chris, you can hit both of those specific questions, the Reg II and the onetime items. I think it’s important at this point to just observe. We’re 6 months in now since Reg II in the U.S. And we’ve had a chance to really engage with our clients and partners on the merchant side of what we do. And we’re having really good discussions, really good dialogues. It’s been a great opportunity for us to highlight our products, our services and especially the various different things that differentiate a Visa debit transaction from other alternatives. And to be honest, we’re getting the chance to have conversations at more senior levels in the organization about the details of our products than we’ve ever had before, which is great.