- Goldman Sachs is set to report third-quarter earnings.
- The Wall Street firm’s deal-making prospects are in the spotlight.
At the Goldman Sachs Financial Services Conference in New York on December 6, 2022, Goldman Sachs Group Inc. Chief Executive Officer is David Solomon.
Michael Nagel | Bloomberg | Good pictures
Goldman Sachs is scheduled to report third-quarter earnings before the opening hours on Tuesday.
Here’s what Wall Street expects:
- Earnings: $5.31 per share, according to LSEG, formerly known as Refinitiv
- Revenue: $11.19 billion
- Trading Revenue: Fixed Income $2.8 billion, Equities $2.73 billion, One Street Account
- Investment banking revenue: $1.48 billion
Wall Street Deal Fixing?
Among its big bank peers, Goldman Sachs relies heavily on investment banking and trading revenue.
Despite efforts to diversify its revenue stream under CEO David Solomon, first a poor retail banking push and then it emphasized growth in asset and wealth management, empowering the Wall Street firm. Last quarter, trading and consulting account Two thirds Goldman’s earnings.
That was a headwind as mergers, initial public offerings and debt issuance all froze this year as the Federal Reserve raised interest rates to slow the economy. Analysts are keen to learn about Goldman’s pipeline of deals, with signs of activity picking up recently.
At the same time, Goldman has taken hits from two areas: its strategic layoffs from retail banking have left the company loss-making as it finds buyers for redundant operations, and its exposure to commercial real estate has resulted in writedowns.
Last week, Goldman said the sale of its lending business, GreenSky, would result in third-quarter results of 19 cents per share.
Analysts are eager to hear Salomon’s view on the investment banking outlook and how the rest of its consumer effort — mainly its Apple Card business — fits into the latest iteration of Goldman Sachs.
Goldman shares are down 8.4% this year since Monday, a better showing than the KBW Bank Index’s 21% decline.
Last week, JPMorgan, Wells Fargo and Citigroup topped expectations for third-quarter profits, helped by better-than-expected borrowing costs. Morgan Stanley reports results on Wednesday.
This story is developing. Check back for updates.