In this article, Goldman Sachs reported fourth-quarter results on Wednesday that exceeded expectations due to stronger-than-expected trading revenue. The bank’s profit nearly doubled from the previous year to $4.11 billion, or $11.95 per share, as revenue increased and expenses decreased. Revenue rose by 23% to $13.87 billion, driven by higher equities and fixed income trading revenue, as well as improved investment banking performance.
During morning trading, the company’s shares surged by more than 5%. Equities trading brought in $3.45 billion in revenue, surpassing the StreetAccount estimate by approximately $450 million. Fixed income trading revenue reached $2.74 billion, exceeding estimates by nearly $300 million. Investment banking fees of $2.05 billion were in line with expectations.
Goldman Sachs also saw strength in its asset and wealth management division, with revenue increasing by 8% to $4.72 billion, surpassing estimates by $560 million. CEO David Solomon expressed optimism, stating, “With an improving operating backdrop and growing CEO confidence, we are harnessing the power of One Goldman Sachs to continue to serve our clients with excellence and create further value for our shareholders.”
The bank has benefited from a resurgence in Wall Street deals, with its shares climbing nearly 50% last year, outperforming its major bank competitors. The Federal Reserve’s easing cycle and Donald Trump’s election in November have raised expectations for mergers and stock transactions.
For Solomon, the current situation contrasts starkly with the challenges faced a year earlier following a strategic shift away from consumer finance ventures. At that time, Solomon faced pressure to address internal concerns, including losses related to consumer finance and a decline in Wall Street deals due to rising interest rates and increased regulatory scrutiny.
On Wednesday, JPMorgan Chase, Wells Fargo, and Citigroup are also releasing their results, while Bank of America and Morgan Stanley are scheduled to report on Thursday.
