Goldman Sachs rides trading, dealmaking to record earnings
Revenue surged 30% year-over-year
Goldman Sachs Group reported record quarterly earnings in the three months through September, driven by continued strength in trading and dealmaking.
The New York-based investment bank earned $3.48 billion, or an adjusted $9.68 per share, outpacing the $5.57 per share that analysts surveyed by Refinitiv were expecting. Revenue surged 30% to $10.78 billion, ahead of the $9.46 billion that was anticipated.
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“Our ability to serve clients who are navigating a very uncertain environment drove strong performance across the franchise, building off a strong first half of the year,” CEO David Solomon said in a statement. “As our clients begin to emerge from the tough economy brought on by the pandemic, we are well positioned to help them recover and grow.”
The firm’s global markets division raked in $4.55 billion. Net revenues generated by the fixed income, currency and commodities group jumped 49% year-over-year to $2.5 billion, or 23% of total revenue. Equities revenue increased 10% to $2.05 billion.
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Dealmaking slowed from last quarter’s trailblazing pace but remained healthy thanks to the second-strongest quarter on record for equity underwriting. The firm’s investment banking unit reported net revenue rose 7% from a year ago to $1.97 billion, down from the record $2.66 billion in the second quarter.
Goldman ranked No. 1 worldwide through the first nine months of the year in mergers and acquisitions, worldwide stock offerings and initial public offerings.
Elsewhere at the firm, net revenue at the asset management division climbed 71% from a year earlier to $2.77 billion, helped by strength in equity investments. Consumer and wealth management revenues rose 13% to $1.49 billion.
Goldman set aside $278 million for credit losses, raising its total allowance to $4.33 billion.
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Shares were down 8.32% this year through Tuesday, lagging the S&P 500’s 8.7% gain.