- Goldman Sachs reported second-quarter earnings on Tuesday that beat Wall Street's expectations.
- Investment banking generated its second highest quarterly net revenues on the back of a robust IPO market.
- Strong investment banking numbers offset a slowdown in the bank's trading business.
Goldman Sachs reported second-quarter earnings on Tuesday that handily exceeded analysts' estimates.
Investment banking generated its second highest quarterly net revenues ever, just behind the first quarter of 2021, thanks in large part to a robust IPO market. The strong numbers in that segment offset a slowdown in Goldman's trading business.
Investment banking revenue climbed to $3.61 billion, higher than the $2.92 billion estimated by analysts surveyed by Bloomberg.
Goldman shares were little changed, up by just 0.53% Tuesday morning.
Here are the key numbers:
- Net Revenue: $15.39 billion, versus $12.43 billion expected.
- Earnings per share: $15.02, versus $10.24 expected.
"Our second quarter performance and record revenues for the first half of the year demonstrate the strength of our client franchise and our continued progress on our strategic priorities. While the economic recovery is underway, our clients and communities still face challenges in overcoming the pandemic," Goldman Sachs CEO David Solomon said in a statement.
Goldman's trading businesses took in $4.9 billion in the quarter, compared to $7.58 billion in the first three months of the year.
The bank also said quarterly net revenues were the second highest in its financial advisory, equity underwriting, and debt underwriting units due in large part to an increased backlog.
Goldman said it has approved plans to increase in the quarterly dividend by 60% to $2 per share beginning in the third quarter of 2021.
The New York-based bank has 17 "buy" ratings, seven "hold" ratings, and two "sell" ratings from analysts.
Goldman Sachs in the first quarter reported earnings that beat expectations for revenue and profit-driven by strong trading and investment banking revenue.
Goldman Sachs and JPMorgan kicked off the earnings season on Tuesday. Bank of America, Citi, and Wells will follow on Wednesday, and Morgan Stanley on Thursday.