VISA INC. 10-Q

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations This management’s discussion and analysis provides a review of the results of operations, financial condition and the liquidity and capital resources of Visa Inc. and its subsidiaries (“Visa,” “we,” “us,” “our” or the “Company”) on a historical basis and outlines the factors that have affected recent earnings, as well as those factors that may affect future earnings. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in Item 1—Financial Statements of this report. Forward-Looking Statements This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 that relate to, among other things, the impact on our future financial position, results of operations and cash flows as a result of the coronavirus (“COVID-19”); prospects, developments, strategies and growth of our business; anticipated expansion of our products in certain countries; industry developments; anticipated benefits of our acquisitions; expectations regarding litigation matters, investigations and proceedings; timing and amount of stock repurchases; sufficiency of sources of liquidity and funding; effectiveness of our risk management programs; and expectations regarding the impact of recent accounting pronouncements on our consolidated financial statements. Forward-looking statements generally are identified by words such as “believes,” “estimates,” “expects,” “intends,” “may,” “projects,” “could,” “should,” “will,” “continue” and other similar expressions. All statements other than statements of historical fact could be forward-looking statements, which speak only as of the date they are made, are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, many of which are beyond our control and are difficult to predict. We describe risks and uncertainties that could cause actual results to differ materially from those expressed in, or implied by, any of these forward-looking statements in our SEC filings, including our Annual Report on Form 10-K, for the year ended September 30, 2020 and our subsequent reports on Forms 10-Q and 8-K. Except as required by law, we do not intend to update or revise any forward-looking statements as a result of new information, future events or otherwise. 27 Table of Contents Overview Visa is a global payments technology company that enables innovative, secure and reliable electronic payments across more than 200 countries and territories. We facilitate digital payments across a global network of consumers, merchants, financial institutions, businesses, strategic partners and government entities through innovative technologies. Our advanced transaction processing network, VisaNet, enables authorization, clearing and settlement of payment transactions and allows us to provide our financial institution and merchant clients a wide range of products, platforms and value added services. Financial overview. Our as-reported U.S. GAAP and non-GAAP net income and diluted earnings per share are as follows: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 % Change (1) 2021 2020 % Change (1) (in millions, except percentages and per share data) Net income, as reported $ 3,026 $ 3,084 (2) % $ 6,152 $ 6,356 (3) % Diluted earnings per share, as reported $ 1.38 $ 1.38 — % $ 2.80 $ 2.85 (2) % Non-GAAP net income (2) $ 3,031 $ 3,098 (2) % $ 6,156 $ 6,370 (3) % Non-GAAP diluted earnings per share (2) $ 1.38 $ 1.39 (1) % $ 2.80 $ 2.85 (2) % (1) Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. (2) For a full reconciliation of our non-GAAP financial results, see tables in Non-GAAP financial results below. Coronavirus. COVID-19 continues to have an impact globally. While we have been actively monitoring the worldwide spread of COVID-19, the extent to which COVID-19 continues to impact our business remains difficult to predict. Our priority remains the safety of our employees, clients and the communities in which we live and operate. We are taking a measured approach in bringing our employees back in the office, with most of our employees currently working remotely. We continue to remain in close and regular contact with our employees, clients, partners and with governments globally to help them navigate these challenging times. Revenues in the second quarter of fiscal 2021 were at varying stages of recovery. During the quarter, there was continued year-over-year growth in payments volume and processed transactions. Cross-border volume also continued to improve during the quarter, despite many borders remaining closed. Although we have taken measures to modify our business practices and reduce operating expenses, including scaling back hiring plans, restricting travel and the use of external resources, the impact that COVID-19 continues to have on our business remains difficult to predict due to numerous uncertainties, including the transmissibility, severity and duration of the outbreak, new variants of the virus, the effectiveness of social distancing measures or actions that are voluntarily adopted by the public or required by governments or public health authorities, the development, availability and rollout of effective treatments or vaccines, the timing of border openings, and the impact to our employees and our operations, the business of our clients, supplier and business partners, and other factors identified in Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended September 30 2020, filed with the SEC on November 19, 2020. We will continue to evaluate the nature and extent of the impact to our business. Highlights for the first half of fiscal 2021. Net revenues for the three and six months ended March 31, 2021 were $5.7 billion and $11.4 billion, respectively, and decreased 2% and 4% over the prior-year comparable periods, respectively. The year-over-year changes are primarily due to cross-border volume, which were impacted by the spread of COVID-19 globally starting in March 2020 and higher client incentives, partially offset by growth in nominal payments volume and processed transactions. Exchange rate movements in the three and six months ended March 31, 2021, as partially mitigated by our hedging program, positively impacted our net revenues by approximately one half of a percentage point. Total operating expenses for the three months ended March 31, 2021 were $2.1 billion on a GAAP basis and increased 11% over the prior-year comparable period, primarily driven by higher personnel expenses and higher general and administrative expenses, partially offset by lower marketing expenses and lower professional fees. Total operating expenses for the six months ended March 31, 2021 were $4.0 billion on a GAAP basis and increased 1% over the prior-year comparable period, primarily driven by higher personnel expenses, partially offset by lower marketing expenses, lower professional fees and lower general and administrative expenses. 28 Table of Contents Total operating expenses for the three months ended March 31, 2021 were $2.0 billion on a non-GAAP basis and increased 3% over the prior-year comparable period, primarily due to higher personnel expenses, partially offset by lower general and administrative expenses, lower marketing expenses and lower professional fees. Total operating expenses for the six months ended March 31, 2021 were $3.8 billion on a non-GAAP basis and decreased 3% over the prior-year comparable period, primarily driven by lower general and administrative expenses, lower marketing expenses and lower professional fees, partially offset by higher personnel expenses. Non-GAAP financial results. We use non-GAAP financial measures of our performance which exclude certain items which we believe are not representative of our continuing operations, as they may be non-recurring or have no cash impact, and may distort our longer-term operating trends. We consider non-GAAP measures useful to investors because they provide greater transparency into management’s view and assessment of our ongoing operating performance. • 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. It also includes 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. • Indirect taxes. During the three and six months ended March 31, 2021, we recognized a one-time charge within general and administrative expense of $152 million, before tax. Net of the related income tax benefit of $40 million, determined by applying applicable tax rates, non-GAAP net income increased by $112 million. This charge is to record our estimate of probable additional indirect taxes, related to prior periods, for which we could be liable as a result of certain changes in applicable law. This one-time charge is not representative of our ongoing operations. Non-GAAP operating expense, non-operating income (expense), income tax provision, effective income tax rate, net income and diluted earnings per share should not be relied upon as substitutes for, or considered in isolation from, measures calculated in accordance with U.S. GAAP. The following tables reconcile our as-reported financial measures, calculated in accordance with U.S. GAAP, to our respective non-GAAP financial measures for the three and six months ended March 31, 2021 and 2020. Three Months Ended March 31, 2021 Operating Expenses Non-operating Income (Expense) Income Tax Provision Effective Income Tax Rate (1) Net Income Diluted Earnings Per Share (1) (in millions, except percentages and per share data) As reported $ 2,148 $ 47 $ 602 16.6 % $ 3,026 $ 1.38 (Gains) Losses on equity investments, net — (156) (35) (121) (0.05) Amortization of acquired intangible assets (13) — 3 10 — Acquisition-related costs (5) — 1 4 — Indirect taxes (152) — 40 112 0.05 Non-GAAP $ 1,978 $ (109) $ 611 16.8 % $ 3,031 $ 1.38 29 Table of Contents Six Months Ended March 31, 2021 Operating Expenses Non-operating Income (Expense) Income Tax Provision Effective Income Tax Rate (1) Net Income Diluted Earnings Per Share (1) (in millions, except percentages and per share data) As reported $ 3,991 $ (49) $ 1,224 16.6 % $ 6,152 $ 2.80 (Gains) Losses on equity investments, net — (172) (39) (133) (0.06) Amortization of acquired intangible assets (25) — 6 19 0.01 Acquisition-related costs (8) — 2 6 — Indirect taxes (152) — 40 112 0.05 Non-GAAP $ 3,806 $ (221) $ 1,233 16.7 % $ 6,156 $ 2.80 Three Months Ended March 31, 2020 Operating Expenses Non-operating Income (Expense) Income Tax Provision Effective Income Tax Rate (1) Net Income Diluted Earnings Per Share (1) (in millions, except percentages and per share data) As reported $ 1,930 $ (95) $ 745 19.4 % $ 3,084 $ 1.38 (Gains) Losses on equity investments, net — 2 — 2 — Amortization of acquired intangible assets (11) — 2 9 — Acquisition-related costs (5) — 2 3 — Non-GAAP $ 1,914 $ (93) $ 749 19.5 % $ 3,098 $ 1.39 Six Months Ended March 31, 2020 Operating Expenses Non-operating Income (Expense) Income Tax Provision Effective Income Tax Rate (1) Net Income Diluted Earnings Per Share (1) (in millions, except percentages and per share data) As reported $ 3,968 $ (137) $ 1,447 18.5 % $ 6,356 $ 2.85 (Gains) Losses on equity investments, net — (11) (3) (8) — Amortization of acquired intangible assets (22) — 5 17 0.01 Acquisition-related costs (7) — 2 5 — Non-GAAP $ 3,939 $ (148) $ 1,451 18.6 % $ 6,370 $ 2.85 (1) Figures in the table may not recalculate exactly due to rounding. Effective income tax rate, diluted earnings per share and their respective totals are calculated based on unrounded numbers. Common stock repurchases. In January 2021, our board of directors authorized an additional $8.0 billion share repurchase program. During the three months ended March 31, 2021, we repurchased 8 million shares of our class A common stock in the open market for $1.7 billion. As of March 31, 2021, our repurchase programs had remaining authorized funds of $10.0 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements. Payments volume and processed transactions. Payments volume is the primary driver for our service revenues, and the number of processed transactions is the primary driver for our data processing revenues. Nominal payments volume growth in the U.S. for the three and six months ended December 31, 2020 (1) was 8% for both periods, driven mainly by consumer debit. On a constant-dollar basis, which excludes the impact of exchange rate movements, our international payments volume growth for the three and six months ended December 31, 2020 was 2% for both periods. Growth in processed transactions reflects the ongoing worldwide shift to electronic payments, partially offset by the impact of COVID-19. 30 Table of Contents The following table presents nominal payments and cash volume: U.S. International Visa Inc. Three Months Ended December 31, (1) Three Months Ended December 31, (1) Three Months Ended December 31, (1) 2020 2019 % Change (2) 2020 2019 % Change (2) 2020 2019 % Change (2) (in billions, except percentages) Nominal payments volume Consumer credit $ 414 $ 424 (2) % $ 620 $ 662 (6) % $ 1,033 $ 1,086 (5) % Consumer debit (3) 555 459 21 % 613 537 14 % 1,168 996 17 % Commercial (4) 171 172 — % 103 107 (4) % 274 278 (2) % Total nominal payments volume (2) $ 1,140 $ 1,055 8 % $ 1,335 $ 1,305 2 % $ 2,475 $ 2,360 5 % Cash volume 143 144 (1) % 500 575 (13) % 642 719 (11) % Total nominal volume (2),(5) $ 1,283 $ 1,199 7 % $ 1,835 $ 1,880 (2) % $ 3,117 $ 3,079 1 % U.S. International Visa Inc. Six Months Ended December 31, (1) Six Months Ended December 31, (1) Six Months Ended December 31, (1) 2020 2019 % Change (2) 2020 2019 % Change (2) 2020 2019 % Change (2) (in billions, except percentages) Nominal payments volume Consumer credit $ 791 $ 829 (5) % $ 1,193 $ 1,307 (9) % $ 1,984 $ 2,136 (7) % Consumer debit (3) 1,111 905 23 % 1,197 1,038 15 % 2,308 1,943 19 % Commercial (4) 335 342 (2) % 197 208 (5) % 532 550 (3) % Total nominal payments volume (2) $ 2,237 $ 2,075 8 % $ 2,587 $ 2,553 1 % $ 4,824 $ 4,628 4 % Cash volume 308 292 5 % 980 1,141 (14) % 1,288 1,433 (10) % Total nominal volume (2),(5) $ 2,544 $ 2,367 7 % $ 3,568 $ 3,694 (3) % $ 6,112 $ 6,061 1 % The following table presents nominal and constant payments and cash volume growth: International Visa Inc. International Visa Inc. Three Months Ended December 31, 2020 vs. 2019 (1),(2) Three Months Ended December 31, 2020 vs. 2019 (1),(2) Six Months Ended December 31, 2020 vs. 2019 (1),(2) Six Months Ended December 31, 2020 vs. 2019 (1),(2) Nominal Constant (6) Nominal Constant (6) Nominal Constant (6) Nominal Constant (6) Payments volume growth Consumer credit growth (6) % (8) % (5) % (6) % (9) % (9) % (7) % (7) % Consumer debit growth (3) 14 % 15 % 17 % 18 % 15 % 16 % 19 % 19 % Commercial growth (4) (4) % (4) % (2) % (2) % (5) % (5) % (3) % (3) % Total payments volume growth (2) 2 % 2 % 5 % 5 % 1 % 2 % 4 % 4 % Cash volume growth (13) % (9) % (11) % (7) % (14) % (9) % (10) % (6) % Total volume growth (2) (2) % (1) % 1 % 2 % (3) % (2) % 1 % 2 % (1) Service revenues in a given quarter are assessed based on nominal payments volume in the prior quarter. Therefore, service revenues reported for the three and six months ended March 31, 2021 and 2020, respectively, were based on nominal payments volume reported by our financial institution clients for the three and six months ended December 31, 2020 and 2019, respectively. (2) Figures in the table may not recalculate exactly due to rounding. Percentage changes and totals are calculated based on unrounded numbers. (3) Includes consumer prepaid volume and Interlink volume. (4) Includes large, medium and small business credit and debit, as well as commercial prepaid volume. (5) Total nominal volume is the sum of total nominal payments volume and cash volume. Total nominal payments volume is the total monetary value of transactions for goods and services that are purchased on cards and other form factors carrying the Visa, Visa Electron, Interlink and V PAY brands. Cash volume generally consists of cash access transactions, balance access transactions, balance transfers and convenience checks. Total nominal volume is provided by our financial institution clients, subject to review by Visa. On occasion, previously presented volume information may be updated. Prior-period updates are not material. (6) Growth on a constant-dollar basis excludes the impact of foreign currency fluctuations against the U.S. dollar. 31 Table of Contents The following table provides the number of transactions involving cards and other form factors carrying the Visa, Visa Electron, Interlink, V PAY and PLUS cards processed on Visa’s networks during the periods presented: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 % Change (1) 2021 2020 % Change (1) (in millions, except percentages) Visa processed transactions 37,644 34,941 8 % 76,857 72,716 6 % (1) Figures in the table may not recalculate exactly due to rounding. Percentage change is calculated based on unrounded numbers. Results of Operations Net Revenues The following table sets forth our net revenues earned in the U.S. and internationally: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 $ Change % Change (1) 2021 2020 $ Change % Change (1) (in millions, except percentages) U.S. $ 2,683 $ 2,650 $ 33 1 % $ 5,350 $ 5,367 $ (17) — % International 3,046 3,204 (158) (5) % 6,066 6,541 (475) (7) % Net revenues $ 5,729 $ 5,854 $ (125) (2) % $ 11,416 $ 11,908 $ (492) (4) % (1) Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. Net revenues decreased during the three and six-month comparable periods primarily due to the year-over-year changes in cross-border volume, which were impacted by COVID-19 starting in March 2020 and higher client incentives. The decrease in net revenues was partially offset by growth in nominal payments volume and processed transactions. Our net revenues are impacted by the overall strengthening or weakening of the U.S. dollar as payments volume and related revenues denominated in local currencies are converted to U.S. dollars. Exchange rate movements in the three and six months ended March 31, 2021, as partially mitigated by our hedging program, positively impacted our net revenues by approximately one half of a percentage point. The following table sets forth the components of our net revenues: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 $ Change % Change (1) 2021 2020 $ Change % Change (1) (in millions, except percentages) Service revenues $ 2,845 $ 2,623 $ 222 8 % $ 5,522 $ 5,178 $ 344 7 % Data processing revenues 2,996 2,711 285 11 % 6,029 5,575 454 8 % International transaction revenues 1,488 1,833 (345) (19) % 2,939 3,851 (912) (24) % Other revenues 392 392 — — % 776 757 19 2 % Client incentives (1,992) (1,705) (287) 17 % (3,850) (3,453) (397) 11 % Net revenues $ 5,729 $ 5,854 $ (125) (2) % $ 11,416 $ 11,908 $ (492) (4) % (1) Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. • Service revenues increased primarily due to 5% and 4% growth in nominal payments volume during the three and six-month comparable periods, respectively. Service revenues were also impacted by select pricing modifications and business mix. 32 Table of Contents • Data processing revenues increased mainly due to overall growth in processed transactions of 8% and 6% during the three and six-month comparable periods, respectively, growth in value added services and business mix. • International transaction revenues driven by nominal cross-border volumes, excluding transactions within Europe, declined 19% and 26% during the three and six-month comparable periods, respectively, as COVID-19 spread globally starting in March 2020. International transaction revenues were also impacted by fluctuations in the volatility of a broad range of currencies and business mix. • Client incentives increased in correlation with the increase in payments volumes during the three and six-month comparable periods. The amount of client incentives we record in future periods will vary based on changes in performance expectations, actual client performance, amendments to existing contracts or execution of new contracts. Operating Expenses The following table sets forth components of our total operating expenses: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 $ Change % Change (1) 2021 2020 $ Change % Change (1) (in millions, except percentages) Personnel $ 1,114 $ 940 $ 174 18 % $ 2,095 $ 1,922 $ 173 9 % Marketing 206 235 (29) (12) % 411 509 (98) (19) % Network and processing 179 183 (4) (2) % 352 364 (12) (3) % Professional fees 82 103 (21) (21) % 165 209 (44) (21) % Depreciation and amortization 201 192 9 5 % 398 374 24 7 % General and administrative 363 269 94 35 % 566 582 (16) (3) % Litigation provision 3 8 (5) (66) % 4 8 (4) (55) % Total operating expenses $ 2,148 $ 1,930 $ 218 11 % $ 3,991 $ 3,968 $ 23 1 % (1) Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. • Personnel expenses increased primarily due to increases in headcount and higher incentive compensation, reflecting our strategy to invest in future growth. • Marketing expenses decreased primarily due to delays in spending to later in fiscal 2021. • Professional fees decreased reflecting non-recurring expenses in the prior year and delays in spending to later in fiscal 2021. • Depreciation and amortization expenses increased primarily due to additional depreciation and amortization from our on-going investments, including acquisitions. • General and administrative expenses increased in the three months ended March 31, 2021, as a result of a one-time charge to record our estimate of probable additional indirect taxes, related to prior periods, for which we could be liable as a result of certain changes in applicable law, partially offset by lower travel expenses and lower usage of travel related product benefits. In the six months ended March 31, 2021, expenses decreased due to lower travel expenses and lower usage of travel related product benefits, partially offset by the one-time charge of indirect taxes. 33 Table of Contents Non-operating Income (Expense) The following table sets forth the components of our non-operating income (expense): Three Months Ended March 31, Six Months Ended March 31, 2021 2020 $ Change % Change (1) 2021 2020 $ Change % Change (1) (in millions, except percentages) Interest expense, net $ (121) $ (118) $ (3) 3 % $ (257) $ (229) $ (28) 12 % Investment income and other 168 23 145 650 % 208 92 116 128 % Total non-operating income (expense) $ 47 $ (95) $ 142 (150) % $ (49) $ (137) $ 88 (65) % (1) Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on unrounded numbers. • Interest expense, net increased in the three and six months ended March 31, 2021 primarily as a result of the issuance of debt in fiscal 2020, offset by a discrete tax benefit recognized during the three months ended March 31, 2021. • Investment income and other increased in the three and six months ended March 31, 2021 primarily due to higher gains on our equity investments, offset by lower interest income on our cash and investments. Effective Income Tax Rate The following table sets forth our effective income tax rate: Three Months Ended March 31, Six Months Ended March 31, 2021 2020 % Change 2021 2020 % Change Effective income tax rate 17 % 19 % (2) % 17 % 19 % (2) % The decrease in the effective tax rate was primarily due to $66 million and $147 million of tax benefits recognized during the three and six months ended March 31, 2021, respectively, as a result of the conclusion of audits by taxing authorities. Liquidity and Capital Resources Cash Flow Data The following table summarizes our cash flow activity for the periods presented: Six Months Ended March 31, 2021 2020 (in millions) Total cash provided by (used in): Operating activities $ 6,842 $ 5,342 Investing activities 1,474 2,441 Financing activities (7,945) (5,887) Effect of exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents 16 88 Increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents $ 387 $ 1,984 Operating activities. Cash provided by operating activities for the six months ended March 31, 2021 was higher than the prior-year comparable period primarily due to lower client incentive payments and the timing and impact of COVID-19 on settlement in the prior-year period. 34 Table of Contents Investing activities. Cash provided by investing activities for the six months ended March 31, 2021 decreased primarily due to higher purchases of investment securities, partially offset by higher sales and maturities of investment securities as compared to the prior-year period. Financing activities. Cash used in financing activities for the six months ended March 31, 2021 was higher than the prior-year comparable period primarily due to the $3.0 billion principal debt payment upon maturity of our senior notes in December 2020 and the absence of the $1.0 billion commercial paper issued in the prior year, partially offset by lower share repurchases. See Note 7—Debt and Note 9—Stockholders’ Equity to our unaudited consolidated financial statements . Sources of Liquidity Our primary sources of liquidity are cash on hand, cash flow from operations, our investment portfolio and access to various equity and borrowing arrangements. Funds from operations are maintained in cash and cash equivalents and short-term or long-term available-for-sale investment securities based upon our funding requirements, access to liquidity from these holdings and the returns that these holdings provide. Based on our current cash flow budgets and forecasts of our short-term and long-term liquidity needs, we believe that our current and projected sources of liquidity will be sufficient to meet our projected liquidity needs for more than the next 12 months. We will continue to assess our liquidity position and potential sources of supplemental liquidity in view of our operating performance, current economic and capital market conditions and other relevant circumstances. Uses of Liquidity There has been no significant change to our primary uses of liquidity since September 30, 2020, except as discussed below. Common stock repurchases. During the six months ended March 31, 2021, we repurchased 17 million shares of our class A common stock for $3.5 billion. As of March 31, 2021, our repurchase programs had remaining authorized funds of $10.0 billion. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements. Dividends . During the six months ended March 31, 2021, we declared and paid $1.4 billion in dividends to holders of our common and preferred stock. On April 23, 2021, our board of directors declared a cash dividend in the amount of $0.32 per share of class A common stock (determined in the case of class B and C common stock and series A, UK&I and Europe preferred stock on an as-converted basis), which will be paid on June 1, 2021, to all holders of record as of May 14, 2021. See Note 9—Stockholders’ Equity to our unaudited consolidated financial statements. We expect to continue paying quarterly dividends in cash, subject to approval by the board of directors. All preferred and class B and C common stock will share ratably on an as-converted basis in such future dividends. Senior notes . During the six months ended March 31, 2021, we repaid $3.0 billion of principal upon maturity of our senior notes due December 14, 2020. See Note 7—Debt to our unaudited consolidated financial statements. Accounting Pronouncements Not Yet Adopted In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Board Update (“ASU”) 2019-12, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in the existing guidance for income taxes and making other minor improvements. The amendments in the ASU are effective on October 1, 2021. The adoption is not expected to have a material impact on our consolidated financial statements. In January 2020, the FASB issued ASU 2020-01, which clarifies that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting for the purposes of applying the fair value measurement alternative. The amendments in the ASU are effective on October 1, 2021. The adoption is not expected to have a material impact on our consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform. Subsequently, the FASB also issued an amendment to this standard. The amendments in the ASU are effective upon issuance through December 31, 2022. We are evaluating the effect ASU 2020-04 and its subsequent amendment will have on our consolidated financial statements. 35 Table of Contents ITEM 3. Quantitative and Qualitative Disclosures about Market Risk There have been no significant changes to our market risks since September 30, 2020.