Wall Street banks welcome “harvest season”! Goldman Sachs (GS.US) Q1 revenue and profit exceeded expectations, and the stock trading business became a growth engine

The Zhitong Finance App learned that before the US stock market on Monday, Goldman Sachs (GS.US) announced the first quarter results. According to the data, the company's Q1 revenue was US$15.1 billion, exceeding market expectations of US$14.8 billion; earnings per share were US$14.12, which also exceeded market expectations. Against the backdrop of market turmoil caused by the trade war, Goldman Sachs Q1 stock trading revenue increased 27% year over year to US$4.19 billion, reaching a record high.

Goldman Sachs's performance continued Wall Street Bank's strong momentum, and rivals such as JPMorgan Chase (JPM.US) and Morgan Stanley (MS.US) also reported record quarterly stock trading revenue last week. Notably, this latest performance is based on Goldman Sachs's 2024 stock trading revenue already growing by nearly 50%.

Goldman Sachs's stock trading business recorded a record high in revenue

Goldman Sachs CEO David Solomon said in a statement: “Although the operating environment we faced as we entered the second quarter was clearly different from that of earlier this year, we are confident that we will continue to support our customers.”

The Trump administration's policy statement caused fluctuations in the first three months of this year, but earlier this month, market turmoil further intensified as Trump announced more tariff policies.

Goldman Sachs's deal-matching business still faces challenges, as market fluctuations driving transactions also weaken clients' willingness to sign large mergers, acquisitions and financing agreements. Goldman Sachs's investment banking revenue for the first quarter was US$1.91 billion, down 8% year over year.

Financial advisory revenue and stock underwriting revenue both fell short of expectations, but the bank's debt business revenue was higher than expected.

Goldman Sachs said that although large transactions are still scarce, the backlog of investment banking business orders has increased month-on-month. This echoes the views expressed by Morgan Stanley CEO Ted Pick on Friday, when he said that many deals were suspended but not abandoned.

According to the data, Goldman Sachs's fixed income revenue for the first quarter was 4.4 billion US dollars, slightly lower than expected, but it is still one of the highest quarterly revenues in the bank's history.

Goldman Sachs traders can benefit from market fluctuations to a certain extent, but Solomon also called on US President Donald Trump to announce a more clear policy agenda to provide certainty for investors.

According to the data, Goldman Sachs's return on equity for the first quarter was 16.9%, higher than market expectations.

Revenue from the bank's huge asset and wealth management business was $3.68 billion, lower than analysts' expectations of $3.84 billion.

Goldman Sachs is trying to expand the size of the division, including opening private equity funds to individual investors outside of banks. The move aims to create a more stable revenue stream, tap into the private equity market's growing demand for investment, and ease investors' concerns about the lack of predictability in their business. The division currently manages $3.17 trillion in assets.

As of press release, Goldman Sachs shares rose more than 2% before the market. The stock is down 13% cumulatively since this year.