Oct. 30 (Bloomberg) -- Visa Inc., the world's largest credit-card company, said that while spending held up in the most recent quarter the U.S. slowdown may cause revenue growth next year and in 2010 to be at the lower end of its estimate.

The fiscal fourth-quarter net loss shrank to $356 million, or 45 cents a share, from a pro-forma $1.66 billion loss a year earlier, the San Francisco-based company said late yesterday in a statement. Excluding one-time expenses, Visa earned $448 million, or 58 cents a share, a penny better than the average estimate of 23 analysts surveyed by Bloomberg.

``Given the uncertainty over the longer-term direction of the economy and the globe for the full year of 2009 and 2010, we are targeting the lower end'' of a an estimate of 11 percent to 15 percent revenue growth, Chief Executive Officer Joe Saunders said yesterday in a conference call. Visa still expects to meet its earnings targets, he said.

Saunders will have to overcome weaker consumer spending and an economy teetering near recession to keep revenue growing. Visa said operating revenue advanced 17 percent to $1.71 billion during the quarter as overseas growth and the continuing adoption of credit and debit cards globally cushioned the effects of a U.S. slowdown.

Visa's debit-card business also helped it maintain revenue growth of about 10 percent in the quarter that ended in September, Saunders said. While credit-card purchase volumes slowed from 1 percent to 2 percent growth in previous months to negative in the first three weeks of October, debit maintained ``low double digit'' gains, he said.

Share Price Falls

The card company has slipped more than 40 percent from its May high of $88.50 amid concern the U.S. economic slump is spreading overseas. Consumer borrowing fell $7.9 billion in August, the biggest drop since the Federal Reserve began tracking the figures in 1943. Companies cut workers by the most in five years last month, pushing the jobless rate to 6.1 percent, according to the Labor Department.

Spending volume rose 15 percent to $699 billion from a year earlier as the number of transactions rose 14 percent to 11.5 billion.

For the full year, Visa had an $804 million profit, compared with an $861 million loss a year earlier. The annual profit included litigation expenses of $1.47 billion, $1.13 billion of which came in the fourth quarter and was tied to a legal settlement with Discover Financial Services.

Lawsuit Settled

Visa announced this week it will pay Discover $1.89 billion to settle a 2004 antitrust lawsuit accusing the network of blocking banks from issuing Discover cards. More than 90 percent of the payment was already set aside in a fund created during Visa's IPO and Saunders said that the settlement will have ``no direct cost'' to common shareholders. MasterCard Inc., the No. 2 credit-card network, will pay $862.5 million. The company is scheduled to report results on Nov. 3.

Unlike rival American Express Co., Visa and MasterCard are insulated from rising defaults because they process transactions and don't make loans to cardholders. Lenders have reported declining profits as they set aside more money for future losses, including American Express, which said third-quarter profit from continuing operations dropped 23 percent to $861 million.

Rising defaults hurt third-quarter profit at Discover, which almost doubled provisions for loan losses and warned more could be set aside. The Riverwoods, Illinois-based firm said income from continuing operations fell 27 percent to $178.9 million.

Capital One Financial Corp., the Mclean, Virginia-based credit-card lender and bank, had to add $208.6 million to loss reserves and said it expects about $7.2 billion in soured loans in the next year.

To contact the reporter on this story: Hugh Son in New York at hson1@bloomberg.net

Last Updated: October 30, 2008 00:00 EDT