Visa 2008 Annual Report Download - page 61

Table of Contents
The following table sets forth our actual and pro forma operating revenues earned in the U.S., throughout the rest of the world, and from Visa Europe.
Revenues earned from Visa Europe are a result of our contractual arrangement with Visa Europe, as governed by the framework agreement that provides for
trademark and technology licenses and bilateral services. See Note 4—Visa Europe to our consolidated financial statements included elsewhere in this report.
Fiscal Year ended September 30,
Visa Inc.
2008
Pro
Forma
2007
$
Change
%
Change
(in millions, except percentages)
U.S. operating revenues $ 3,664 $ 3,312 $ 352 11%
Rest of world operating revenues 2,378 1,688 690 41%
EU fee operating revenues 221 193 28 15%
Total Operating Revenues $ 6,263 $ 5,193 $ 1,070 21%
Operating revenues earned throughout the rest of the world for the twelve month periods ended September 30, 2008 and 2007 represented 38% and
33% of total operating revenues, respectively. Growth in operating revenues earned throughout the rest of the world accounted for 64% of the increase in total
operating revenues for the twelve month periods. The increase in operating revenues throughout the rest of the world reflects the impact of pricing
modifications made on various services during the second half of fiscal 2007 as those geographies transitioned to a business model seeking to increase
profitability. While we believe that these pricing changes will generate ongoing benefits, we do not believe that this rate of revenue growth is representative of
sustainable future revenue growth because it includes the impact of these pricing modifications. We expect future price increases to correlate more closely
with innovations in our product line and improvements in our service model. We regularly review our pricing strategy to ensure that it competitively aligns
with the value and growth opportunities provided to our customers.
A significant portion of the revenues we earn outside the United States result from cross-border business and leisure travel. Revenues from processing
foreign currency transactions for our customers fluctuate with cross-border travel and our customers' need for transactions to be converted into their base
currency. We expect that current worldwide turbulence in the financial and credit markets will moderate discretionary spending, and the rate of cross-border
business and leisure travel, in the near term.
The following table sets forth the components of our actual and pro forma total operating revenues.
Fiscal Year ended September 30,
Visa Inc.
2008
Pro
Forma
2007
$
Change
%
Change
(in millions, except percentages)
Service fees $ 3,061 $ 2,582 $ 479 19%
Data processing fees 2,073 1,659 414 25%
International transaction fees 1,721 1,193 528 44%
Other revenues 569 473 96 20%
Volume and support incentives (1,161) (714) (447) 63%
Total Operating Revenues $ 6,263 $ 5,193 $ 1,070 21%
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