Goldman Sachs blows past estimates on trading, dealmaking

Annual M&A revenue hit a record $9.42B

Goldman Sachs Group reported strong fourth-quarter results bolstered by strength in dealmaking and trading.

The New York-based investment bank earned $4.51 billion, or $12.08 per share, on revenue of $11.74 billion. The results exceeded the $7.47 per share and revenue of $9.99 billion that Wall Street analysts surveyed by Refinitiv were anticipating.

TickerSecurityLastChangeChange %
GSTHE GOLDMAN SACHS GROUP, INC.319.79-7.72-2.36%

Revenue from all business segments was higher than a year ago.

“We were able to help clients navigate a difficult environment, and, as a result, achieved strong results across the franchise, while advancing our strategic priorities,” Goldman Sachs CEO David Solomon said in a statement.

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Revenue from the firm’s investment banking division totaled $2.61 billion in the three months through December, up 27% from the prior year. Significantly higher revenue from underwriting and financial advisory services was partially offset by weaker corporate lending.

Trading also remained strong as net revenue from the bank’s global markets division totaled $4.27 billion in the fourth quarter, a 23% increase from last year.

Fixed income, currencies and commodities trading revenue rose 6% to $1.88 billion amid strong performance in credit products, partially offset by a decline in interest rate products and mortgages. Equities revenue jumped 40% to $2.39 billion.

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For the full year, the firm earned $9.46 billion, or $24.74 per share, as sales rose 22% year over year to $44.56 billion.

Investment banking revenue hit a record $9.42 billion as the firm ranked No. 1 in announced and completed mergers and acquisitions. Trading revenue reached a decade high of $21.16 billion.

Asset management revenue totaled $7.98 billion and consumer and wealth management revenue reached a record $6 billion.

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Firmwide assets rose by $286 billion in 2020 to $2.15 trillion.

Goldman Sachs shares were up 14% this year through Friday compared with the S&P 500’s 0.3% decline.