Goldman Sachs delivers huge earnings beat on trading bonanza

Goldman Sachs

Goldman Sachs announced first-quarter earnings Tuesday morning, smashing analyst expectations.

The bank reported earnings of $US6.95 a share, well ahead of analyst expectations of $US5.56 and the third-highest on record. Here are the key numbers:

  • Revenue: The bank delivered $US10.4 billion in revenue, well ahead of analyst expectations of $US8.75 billion. It was the best quarterly revenue figure in three years and was up 25% from the same period a year earlier.
  • Net income: Net income came in at $US2.8 billion, up from $US2.2 billion expected.
  • Investment banking: The investment-banking business delivered revenue of $US1.8 billion, with the debt capital markets business posting its second-highest revenue number. The bank said that was driven by investment-grade, leveraged finance, and asset-backed activity. In equities, initial-public-offering activity also picked up.
  • Trading: Institutional client securities posted revenue of $US4.4 billion, with both fixed income and equities having their best quarter in three years. Fixed-income revenue, at $US2.1 billion, was up 23% from a weak first quarter, driven by better revenue in currencies, commodities, and credit. In equities, revenue was $US2.3 billion.
  • Investment management: Goldman’s funds business delivered record revenue of $US1.8 billion, with assets under supervision increasing to a record $US1.5 trillion.
  • Investing and lending: Net revenue was $US2.1 billion, up 43% from last year.

“Solid performance across our businesses produced strong returns in the first quarter,” CEO Lloyd Blankfein said.

Goldman Sachs joins Bank of America Merrill Lynch, Citigroup, and JPMorgan in reporting first-quarter earnings that beat analyst expectations.

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