Goldman Sachs Group (GS) posted better-than-expected second quarter earnings Monday as a big gain in global markets revenues offset a slump in investment banking fees.
Goldman said earnings for the three months ending in June were pegged at $7.73 per share, down 48.5% from the same period last year but firmly ahead the Street consensus forecast of $6.97 per share. Group revenues, Goldman said, fell 23% to $11.86 billion, but again topped analysts' forecasts of an $10.875 billion total.
Investment banking revenues fell 41% from last year to $2.14 billion, Goldman said, but that was more than offset by a 32% increase in global markets revenues, which were up 32% at $6.47 billion. Net revenues in equities were up 11% to $2.86 billion, Goldman said.
Goldman also boosted its quarterly dividend by 25%, to $2.50 per share, to shareholders of record on September 1.
“We delivered solid results in the second quarter as clients turned to us for our expertise and execution in these challenging markets," said CEO David Solomon. "Despite increased volatility and uncertainty, I remain confident in our ability to navigate the environment, dynamically manage our resources and drive long-term, accretive returns for shareholders.”
Goldman Sachs shares were marked 5.4% higher in early trading immediately following the earnings release to change hands at $309.30 each, a move that would trim the stock's year-to-date decline to around 19.2%.
Bank earnings got off to a mixed start last week as JPMorgan (JPM) posted a 27% decline in second quarter earnings, with an $8.6 billion tally that missed Street forecasts, and set aside $1.1 billion in reserves to set against bad loans and credit losses, linked in part to the 'deteriorating' economic outlook.
JPMorgan CEO Jamie Dimon said geopolitical tension, high inflation, waning consumer confidence, interest rate uncertainty and the war in Ukraine "are very likely to have negative consequences on the global economy sometime down the road."
Citigroup (C), however, had one of its best post-earnings jumps in more than a decade Friday after it posted a Street-beating bottom line of $2.19 per share on revenues of $19.64 billion.
The bank also set aside $375 million to cover potential bad-loan losses, a much smaller figure than that of its rivals Wells Fargo (WFC) and JPMorgan.
