Visa's Earnings Beat Expectations Thanks to Overseas Spending

A surge in cross-border travel helped Visa to deliver fiscal first-quarter results that came in ahead of Wall Street's expectations.

Visa (ticker: V) earned $1.99 per share from $7.9 billion in revenue, according to generally accepted accounting principles. Adjusted for $341 million in litigation expenses and a $106 million loss from equity investments, the card company had a profit of $4.6 billion, or $2.18 a share. Analysts surveyed by FactSet expected Visa to earn $2.01 a share from $7.7 billion in revenue.

Revenue climbed 12% from a year earlier thanks to a 22% increase in cardholders' spending abroad and a 10% jump in the number of processed transactions. Non-GAAP profits increased by 17%.

The company returned $4 billion to shareholders during the quarter in the form of buybacks and dividends.

Management appeared optimistic that the good times could continue.

"I continue to see a bright future for Visa and believe that we have the right strategy to invest in and capitalize on the opportunities ahead across consumer payments, new flows and value added services," Alfred Kelly, the outgoing chief executive at Visa, said in a statement. His successor, Ryan McInerney, will assume the top spot on Feb. 1.

Shares of Visa ticked up 1.2% in premarket trading Friday. Investors have been looking to card companies and other financial firms to get a sense of the strength of consumers' ability to keep spending going into an expected recession. Households have been squeezed by higher prices on everyday items , but so far, that hasn't dampened their enthusiasm for travel, as the increase in cross-border transactions illustrates.

Visa's results come after rival Mastercard (MA) announced fourth quarter results that surpassed expectations . The company also credited a surge in cross-border transactions and a resilient consumer as reasons for its success.

American Express (AXP) will post earnings before the bell Friday .