Fiscal Second Quarter 2023 Financial Results
Reconciliation of GAAP to Non-GAAP Financial Results - continued
Gains and losses on equity investments. Gains and losses on equity investments include periodic non-cash fair value adjustments and gains and losses upon sale
of an investment. These long-term investments are strategic in nature and are primarily private company investments. Gains and losses and the related tax
impacts associated with these investments are tied to the performance of the companies that we invest in and therefore do not correlate to the underlying
performance of our business.
Amortization of acquired intangible assets. Amortization of acquired intangible assets consists of amortization of intangible assets such as developed technology,
customer relationships and brands acquired in connection with business combinations executed beginning in fiscal 2019. Amortization charges for our acquired
intangible assets are non-cash and are significantly affected by the timing, frequency and size of our acquisitions, rather than our core operations. As such, we
have excluded this amount and the related tax impact to facilitate an evaluation of our current operating performance and comparison to our past operating
performance.
Acquisition-related costs. Acquisition-related costs consist primarily of one-time transaction and integration costs associated with our business combinations.
These costs include professional fees, technology integration fees, restructuring activities and other direct costs related to the purchase and integration of acquired
entities. These costs also include retention equity and deferred equity compensation when they are agreed upon as part of the purchase price of the transaction
but are required to be recognized as expense post-combination. We have excluded these amounts and the related tax impacts as the expenses are recognized for
a limited duration and do not reflect the underlying performance of our business.
Litigation provision. During the six months ended March 31, 2023 and 2022, we recorded additional accruals to address claims associated with the interchange
multidistrict litigation of $341 million and $145 million, respectively, and related tax benefit of $76 million and $32 million, respectively, determined by applying
applicable tax rates. Under the U.S. retrospective responsibility plan, we recover the monetary liabilities related to the U.S. covered litigation through a downward
adjustment to the rate at which shares of our class B common stock convert into shares of class A common stock.
Russia-Ukraine charges. During the three and six months ended March 31, 2022, we recorded a loss within general and administrative expense of $35 million from
the deconsolidation of our Russian subsidiary. We also incurred charges of $25 million in personnel expense as a result of steps taken to support our employees in
Russia and Ukraine. We have excluded these amounts and the related tax benefit of $4 million, determined by applying applicable tax rates, as they are one-time
charges and do not reflect the underlying performance of our business.
VISA
Fiscal Second Quarter 2023 Financial Results
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