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Yahoo
17-07-2025
- Business
- Yahoo
Trading, investment banking power beat at Goldman Sachs
UPDATE: This article now includes commentary from Goldman's earnings call as well as commentary from analysts. Tariff-induced economic uncertainty appears to have put plenty of wind in Goldman Sachs' sails, as the New York-based investment banking giant posted record trading revenues and increased profits Wednesday. Goldman reported second-quarter earnings of $3.72 billion, which was up 22% from a year ago. Earnings per share of $10.91 exceeded expectations by a wide margin, as analysts had forecast earnings per share of $9.63, according to S&P Capital IQ. The better-than-expected performance was driven by heady increases in investment banking and equities revenues, which spiked 26% and 36%, respectively, from the same period in 2024. The performance of the wealth and asset management unit, which is Goldman's other major line of business, was muted, with revenue declining 3% from the quarter that ended on June 30, 2024. Firmwide revenue totaled $14.6 billion, up 15% from a year earlier. The solid financial results pushed compensation costs higher. The $1.78 trillion-asset company reported quarterly operating expenses of $9.2 billion, up 8% annually. "Our strong results for the quarter reflected healthy client activity levels across our businesses, our differentiated franchise positions and the talent and commitment of our people," Goldman Chairman and CEO David Solomon said in a press release. "Given the strategic decisions and investments we've made, we continue to believe that the firm is well positioned to perform for our shareholders." Goldman was a major beneficiary of the Federal Reserve's decision earlier this month to reduce various big banks' regulatory capital buffers. The company recently reported a cut in its stress capital buffer of nearly 3 percentage points to 3.4%. When the new buffer takes effect on Oct. 1, it will reduce Goldman's required common equity Tier 1 capital ratio to 10.9% from the current 13.6% threshold. Chief Financial Officer Dennis Coleman told analysts Wednesday that Goldman intends to operate at a capital level 50 to 100 basis points above the regulatory minimum, so the Fed's recent decision should result in a sizable amount of capital becoming available for corporate purposes. Solomon, for his part, did not rule out merger-and-acquisition activity as one possible use of capital — particularly in the wealth and asset management sphere. But he said on the company's conference call with analysts that any deal would have to clear a "very, very high" bar from both a strategic and financial perspective. "We're growing our asset and wealth management business," Solomon said. "There might be opportunities to accelerate that growth and the scale of what we're doing. That's what our focus would be." Goldman has already taken a significant step toward returning more capital to its shareholders. Its board voted Monday to increase the company's quarterly dividend by 33% to $4 per share. Though Solomon said on Wednesday's earnings call that investing in initiatives to grow Goldman's business lines is the "first and primary focus," he added that he sees room to further expand the dividend. "I do think, given what is going on with the capital stack and the capital regime, and given the way we're executing on our strategy, there is room for us to continue to drive that dividend higher," Solomon said. Goldman reported investment banking fee income of $2.2 billion for the quarter ending June 30, up from $1.7 billion a year ago and $1.9 billion for the quarter ending March 31. Advisory fees grew 71% from the same period in 2024, while debt-underwriting revenue fell by 5% year over year. The investment banking pipeline remains robust, "notably higher than the year-end 2024 level," Coleman said, with much of that potential new business centering around increased M&A activity. "The level of dialogue has significantly increased," Solomon said. He attributed the uptick both to businesses' desire for scale and to a more welcoming regulatory environment. "There's a confidence level on the part of CEOs that significant-scale industry consolidation is possible, so people are very engaged in that across a range of industries," Solomon said. Goldman appeared to benefit during the second quarter from a turbulent global economy. Equities revenue of $4.3 billion was up significantly from a year earlier, setting a new record high for the 156-year-old company. Trading income also boosted Goldman's first-quarter earnings, which totaled $4.74 billion. Revenue from the bank's asset and wealth management unit totaled $3.78 billion for the three months ending June 30, as an increase in management and other fees was overshadowed by declines in equity and debt investments. Despite the unit's revenue decline, total assets under supervision reached $3.29 trillion on June 30, up 12% from a year earlier. Goldman's results "demonstrated continued progress on the firm's strategic initiatives," Moody's Ratings Senior Vice President David Fanger said in a statement. Steven Chubak, who covers Goldman for Wolfe Research, wrote in a research note that he was impressed by "the magnitude of revenue strength across all lines of business." Goldman's loan portfolio totaled $217 billion on June 30, up 18% from a year earlier. The bank reported second-quarter charge-offs of $290 million, down from $376 million in the three months ending March 31. Solomon said the company would stay vigilant about emerging risks. "At this time, the economy and markets are generally responding positively to the evolving policy environment, but as developments rarely unfold in a straight line, we remain very focused on risk management," Solomon said in the press release. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Times
02-07-2025
- Automotive
- Business Times
Tesla reports lower car sales, extending slump
[NEW YORK] Tesla reported another hefty drop in auto sales on Wednesday, extending a difficult period amid intensifying electric vehicle competition and backlash over CEO Elon Musk's political activities. The EV maker reported 384,122 deliveries in the second quarter, down 13.5 per cent from the year-ago period. Shares rallied after the disclosure, which was better than some leading forecasts in recent days. The sales figures, which are global, reflect the more contested nature of the EV market, which Tesla once dominated, but which now also features BYD and other low-cost Chinese companies, as well as legacy western automakers like General Motors, Toyota and Volkswagen. But Musk's political activism on behalf of right-wing figures has also made the company a target of boycotts and demonstrations, weighing on sales. In recent days, Musk has revived a feud with US President Donald Trump, dragging Tesla shares lower on Tuesday. The figures portend another poor round of earnings when Tesla reports results on July 23. Analysts currently project a drop of 16 per cent to US$1.2 billion in profits, according to S&P Capital IQ. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Tesla has faced questions about a lack of new retail auto products to wow consumers after Musk's futuristic Cybertruck proved polarising. Analysts will be looking for an update on the state of new offerings after Tesla said in April that it planned 'more affordable models' in the first half of 2025. The company has begun deliveries of its revamped Model Y in some markets, according to news reports. Tesla launched a long-discussed robotaxi venture in the Texas state capital Austin, lending momentum to Musk's branding of the company as at the forefront of autonomous and artificial intelligence technology. But reports that the self-driving cars have driven recklessly have prompted oversight from US regulators. Heading into Wednesday's data release, notes from JPMorgan Chase and Deutsche Bank had forecast bigger drops in second-quarter deliveries, citing poor figures in Europe in particular. The JPMorgan note was especially bearish, setting a December share price target of US$115, down more than 60 per cent from current levels and citing an expected drag from the elimination of US tax credits for EVs under Trump's signature domestic policy legislation moving through Congress. Following the results, Morningstar said in a note that Tesla would not see 'meaningful deliveries growth without a new lower-cost vehicle aimed at the affordable market.' For the second quarter in a row, Tesla produced more vehicles than it delivered, 'raising concerns regarding demand and inventory levels,' said a note from CFRA Research that called the figures 'a modest disappointment.' But Wedbush's Dan Ives said Wednesday's 'better-than-feared' report set the stage for growth. 'If Musk continues to lead and remain in the driver's seat, we believe Tesla is on a path to an accelerated growth path over the coming years with deliveries expected to ramp in the back-half of 2025 following the Model Y refresh cycle,' Ives said. Political wildcard A wildcard remains: how Musk's shifting relationship with Trump could affect Tesla. Musk donated more than US$270 million to Trump's presidential campaign, barnstorming key battleground states for the Republican. After the election, he oversaw the launch of the Department of Government Efficiency, a controversial initiative that eliminated thousands of government jobs deemed by Doge to be part of a pattern of waste, fraud and abuse. But Musk has broken with Trump over the White House's flagship tax and spending bill, which Musk has called 'utterly insane and destructive.' In response, Trump has threatened to target Musk's business empire and warned of deporting the South African-born billionaire, sending Tesla shares plummeting. 'This high-profile feud introduces political risk,' said in a note on Tuesday. 'The personal nature of the conflict, amplified by Trump's comments implying Tesla's reliance on subsidies for survival, has sparked fears of broader policy shifts targeting Musk's business empire.' Tesla shares rose 4.7 per cent early on Wednesday. AFP
France 24
02-07-2025
- Automotive
- France 24
Tesla reports lower car sales but figures better than feared
The EV maker reported 384,122 deliveries in the second quarter, down 13.5 percent from the year-ago period. Shares rallied after the disclosure, which was better than some leading forecasts in recent days. The sales figures released Wednesday, which are global, reflect the more contested nature of the EV market, which Tesla once dominated, but which now also features BYD and other low-cost Chinese companies, as well as legacy western automakers like General Motors, Toyota and Volkswagen. But Musk's political activism on behalf of right-wing figures has also made the company a target of boycotts and demonstrations, weighing on sales. In recent days, Musk has revived a feud with US President Donald Trump, dragging Tesla shares lower on Tuesday. The figures portend another poor round of earnings when Tesla reports results on July 23. Analysts currently project a drop of 16 percent to $1.2 billion in profits, according to S&P Capital IQ. Tesla has faced questions about its dearth of new retail auto products to wow consumers after Musk's futuristic Cybertruck proved polarizing. Analysts will be looking for an update on the state of new offerings after Tesla said in April that it planned "more affordable models" in the first half of 2025. The company has begun deliveries of its revamped Model Y in some markets, according to news reports. Tesla launched a long-discussed robotaxi venture in Austin, Texas, lending momentum to Musk's branding of the company as at the forefront of autonomous and artificial intelligence technology. But reports that the self-driving cars have driven recklessly have prompted oversight from US regulators. Heading into Wednesday's sales figure release, notes from JPMorgan Chase and Deutsche Bank had forecast bigger drops in second-quarter deliveries, citing poor figures in Europe especially. The JPMorgan note was especially bearish, setting a December share price target of $115, down more than 60 percent from today's levels and citing an expected drag from the elimination of US tax credits for EVs under Trump's legislation moving through Congress. But Wedbush's Dan Ives said Wednesday's "better-than-feared" report set the stage for growth. "If Musk continues to lead and remain in the driver's seat, we believe Tesla is on a path to an accelerated growth path over the coming years with deliveries expected to ramp in the back-half of 2025 following the Model Y refresh cycle," Ives said. Political wildcard A wildcard remains how Musk's shifting relationship with Trump could affect Tesla. Musk donated more than $270 million to Trump's 2024 campaign, barnstorming key battleground states for the Republican. After the election, he oversaw the launch of the "Department of Government Efficiency," a controversial initiative that eliminated thousands of government jobs that DOGE said were part of a pattern of waste, fraud and abuse. But Musk has broken with Trump over the White House's flagship tax and spending bill, which Musk rated as wasteful and misguided. Musk has called the bill "utterly insane and destructive" and accused bill supporters of backing "debt slavery." In response, Trump has threatened to target Musk's business empire and warned of deporting the South African-born Musk. Tesla shares fell more than five percent on Tuesday following this back and forth. "This high-profile feud introduces political risk," said in a note Tuesday. © 2025 AFP
Time of India
28-05-2025
- Business
- Time of India
How and why one of the Europe's biggest technology company has lost $130 billion-plus from its value in less than a year
ASML, a key player in the semiconductor supply chain , has seen its market value plummet by over $130 billion in less than a year, dropping from a peak of $429.5 billion in July 2024 to $297 billion by Tuesday's close, per S&P Capital IQ data. The decline reportedly stems from U.S. export restrictions to China and uncertainty over potential U.S. tariffs under President Donald Trump. ASML is one of the biggest technology companies in Europe. The Dutch company, the sole producer of extreme ultraviolet lithography (EUV) machines used by chipmakers like TSMC to manufacture advanced chips, has faced significant headwinds. 'All the equipment manufacturers in the space have come down because they are concentrating all the fears around … the U.S. restrictions to China,' Stephane Houri, head of equity research at ODDO BHF, told CNBC's 'Europe Early Edition' on Wednesday. Houri also pointed to tariff concerns and questions about over-investment in AI, noting uncertainty over whether 'demand is not at the level that many people expect.' What's hurting ASML ASML's inability to ship its most advanced EUV machines to China has limited its sales potential. CEO Christophe Fouquet told CNBC in January that the company's China business is expected to shrink in 2025 compared to 2023 and 2024. Recently, ASML began shipping its next-generation High NA machines, but global chip stocks continue to face pressure from trade uncertainties. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Zumbido e perda de audição? Médico revela técnica caseira de 1 real para aliviar! Zumbido no ouvido Undo Despite these challenges, a potential U.S.-Europe trade deal could ease market concerns. 'If there is an agreement in the end with President Trump and ... Europe and many other countries, they probably will benefit from the relief in the market, and notably in the sector,' Houri said. Analysts remain optimistic, with LSEG data showing an average price target of 779 euros for ASML, suggesting a 17% upside from Tuesday's close. A recent Wells Fargo note, following discussions with ASML's management, highlighted the company's positive outlook for 2025 and 2026, driven by demand from firms like Samsung and Intel for next-generation chipmaking tools.
Yahoo
19-05-2025
- Business
- Yahoo
23andMe files for bankruptcy and will try to find a buyer
23andMe, a formerly high-flying genetic testing company, announced Sunday that it was declaring bankruptcy and that it would seek a buyer. The company also said CEO and co-founder Anne Wojcicki is resigning immediately and will be replaced by Chief Financial and Accounting Officer Joe Selsavage as interim chief executive. 23andMe moved in November to slash 40% of its workforce as part of a restructuring plan, a step that came roughly two months after its entire board resigned. "We expect the court-supervised process will advance our efforts to address the operational and financial challenges we face, including further cost reductions and the resolution of legal and leasehold liabilities," 23andMe Chair Mark Jensen said in a statement. "We believe in the value of our people and our assets and hope that this process allows our mission of helping people access, understand and benefit from the human genome to live on for the benefit of customers and patients." 23andMe offers two basic kinds of services — consumer and therapeutics. The former provides people with information on their ancestry and genetic health profile, including the risk of passing on certain conditions to their children, according to S&P Capital IQ. The therapeutics unit works to develop treatments and conducts research into cancer, immune diseases and other conditions. Data privacy concerns 23andMe's struggles have raised concerns about the privacy of its customers' genetic data, which is used to trace people's ancestry, among other purposes. In filing for bankruptcy protection, the company said there will be no changes to how it manages and protects people's data. 23andMe users must explicitly affirm that the company may share their personal data, although people's data could be included as part of a sale of the company. Some states have passed privacy laws that would require a person's consent before their genetic data is transferred from one entity to another. In its bankruptcy announcement, 23andMe said any buyer of its assets would have to observe applicable privacy laws for customer data. The company has also previously said that any customer data it shares with other parties is anonymous and can't be traced to individual users. 23andMe also allows customers to delete their accounts. To do that, users must log in to their account and submit a request. The company will send an email confirming the request to delete the data, which the user must then verify. 23andMe's stock, which once traded for more than $300 a share, fell to 79 cents before the start of trade Monday. In January, 23andMe reported a third-quarter net loss of $26.8 million on revenue of $60.3 million, an improvement over its loss of $259.7 million on revenue of $44.7 million in the year-ago period. The company filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Eastern District of Missouri. 23andMe said that, if granted approval in bankruptcy court, the company would solicit bids from potential acquirers over a 45-day period and potentially conduct an auction. One possible buyer is Wojcicki herself. The executive, who recently submitted an acquisition offer that 23andMe rejected earlier this month, said in a social media post Monday that she may again bid for 23andMe. "I have resigned as CEO of the company so I can be in the best position to pursue the company as an independent bidder," she wrote, adding that continues to believe in the company's brand and business. "We have had many successes but I equally take accountability for the challenges we have today. There is no doubt that the challenges faced by 23andMe through an evolving business model have been real, but my belief in the company and its future is unwavering," she said. Raw Video: Mexican navy training ship hits Brooklyn Bridge Italy's Trulli: From Past to Present Will the House Republican budget be a sinking ship in the Senate? Sign in to access your portfolio
