Visa 2010 Annual Report Download - page 48

Table of Contents
revenues also benefitted slightly from the inclusion of CyberSource activity since the July acquisition. We do not believe that the current rate of
growth in data processing revenues is representative of sustainable future revenue growth due to the inclusion of these pricing actions, which
have largely anniversaried in the fourth quarter of fiscal 2010. However, we will benefit from the inclusion of a full year CyberSource activity in
fiscal 2011.
Data processing revenues increased in fiscal 2009 due to 8% growth in the number of transactions processed during the year, combined with
other strategic pricing modifications.
• International transaction revenues increased in fiscal 2010 primarily due to a growth of 16% in nominal cross-border payments volume,
combined with strategic pricing modifications which took place after the third quarter of fiscal 2009. We generally expect international
transaction revenue to grow in line with increased cross-border transaction volume, although economic downturns or other adverse international
conditions could hinder this growth.
International transaction revenues increased in fiscal 2009 despite an 11% decline in cross-border nominal payments volume, primarily due to
strategic pricing modifications made after fiscal 2008.
• Other revenues increased during fiscal 2010, primarily due to license fees from Cielo, formerly known as Companhia Brasileira de Meios de
Pagamento, or VisaNet do Brasil, for the use of Visa trademarks and technology intellectual property. We entered into this licensing arrangement
with VisaNet do Brasil following its initial public offering and the sale of our equity interest in the third quarter of fiscal 2009. The increase also
reflects growth in other new license and royalty fees.
Other revenues increased in fiscal 2009 primarily due to growth in the Visa Extras loyalty platform for administrative and rewards fulfillment
services performed in support of the platform.
• Volume and support incentives increased in fiscal 2010 primarily due to growth in global payments volumes and incentives incurred on
significant long-term customer contracts that were initiated or renewed in fiscal 2010. These increases were offset by lower one-time incentives
incurred for early renewals compared to fiscal 2009. As anticipated, volume and support incentives as a percentage of gross revenues were
approximately 16% in fiscal 2010. We expect incentives as a percentage of gross revenues to be in the range of 16.0% to 16.5% for the full 2011
fiscal year. The actual amount of volume and support incentives will vary based on modifications to performance expectations for these contracts,
amendments to existing contracts or new contracts.
Volume and support incentives increased in fiscal 2009 primarily due to incentives incurred on initiation or early renewal of significant long-term
customer contracts. These incentives were partially offset by the absence of a non-recurring charge related to a customer agreement executed in
fiscal 2008.
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