Goldman Sachs Shares Surge Over 4% on Strong Q1 Earnings

Goldman Sachs (GS) witnessed a notable surge of over 4% in intraday trading on Monday following the release of its first-quarter earnings report, which exceeded analyst expectations, primarily driven by robust investment banking revenue.

The banking giant reported total revenue of $14.21 billion for the quarter, accompanied by net income of $4.13 billion, translating to $11.58 per share. These figures notably surpassed analyst estimates compiled by Visible Alpha, which projected $12.92 billion in revenue, $3.1 billion in income, and earnings per share of $8.49.

Goldman recorded substantial year-over-year increases in several revenue streams, including a 38% rise in debt underwriting, a 45% surge in equity underwriting, and a 32% increase in investment banking fees, totalling $2.08 billion compared to $1.58 billion in the same period last year.

Although Goldman’s revenue and income outpaced estimates, its net interest income fell short, standing at $1.61 billion compared to analysts’ projections of $1.76 billion. This figure also marked a decline of about 10% from the $1.78 billion reported in the year-ago quarter.

Unlike some of its counterparts such as JPMorgan Chase (JPM), Citigroup (C), and Wells Fargo (WFC), which emphasised Main Street lending in their earnings reports, Goldman Sachs, under the leadership of CEO David Solomon, has shifted its focus back to traditional investment banking and trading operations, moving away from retail banking initiatives.

Goldman’s board approved another quarterly dividend of $2.75 per share, scheduled to be disbursed on June 27 to shareholders of record on May 30. Additionally, the company repurchased approximately $1.5 billion of its own stock in the first quarter, although further details on future buybacks were not provided in Monday’s earnings report.