It means how it's spoken, so in this case it would be vis-baly. If you'd said you'd read it visually and that it looked about right or that you'd read it contextually and that it was clear what he had meant then I'd have agreed. ps. I'm not going into the different types of phonetics here, they all relate to the perception of sound and speech but I'm pretty sure using any of them it would still be vis-baly
Honestly, I struggle to underthink things in the way most people seem to achieve. I'm kind of envious.
It was clear what he meant though. We could get into phonetics and all sorts of lexical pathways that the brain makes to make sense of words, but it's just not necessary on this occasion.