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Yahoo
17-07-2025
- Business
- Yahoo
The Goldman Sachs Group Inc (GS) Q2 2025 Earnings Call Highlights: Record Revenues and ...
Net Revenues: $14.6 billion for the second quarter. Earnings Per Share (EPS): $10.91. Return on Equity (ROE): 12.8% for the quarter, 14.8% for the first half of the year. Global Banking and Markets Revenues: $10.1 billion for the quarter. Advisory Revenues: $1.2 billion, up 71% year-over-year. Equity Underwriting Revenues: $428 million, flat year-over-year. Debt Underwriting Revenues: $589 million, down 5% year-over-year. FICC Net Revenues: $3.5 billion, up 9% year-over-year. Equities Net Revenues: $4.3 billion, a record for the quarter. Asset and Wealth Management Revenues: $3.8 billion. Management and Other Fees: $2.8 billion, up 11% year-over-year. Private Banking and Lending Revenues: $789 million, up 12% year-over-year. Total Assets Under Supervision: $3.3 trillion, a record high. Alternative Assets Under Supervision: $355 billion. Net Interest Income: $3.1 billion for the second quarter. Total Loan Portfolio: $217 billion at quarter-end. Operating Expenses: $9.2 billion for the quarter. Effective Tax Rate: 20.2% for the first half of 2025. Capital Returned to Shareholders: $4 billion, including $957 million in dividends and $3 billion in stock repurchases. Common Equity Tier 1 Ratio: 14.5% at the end of the second quarter. Warning! GuruFocus has detected 10 Warning Signs with GS. Release Date: July 16, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points The Goldman Sachs Group Inc (NYSE:GS) reported strong financial performance in Q2 2025 with net revenues of $14.6 billion and earnings per share of $10.91. The company's Investment Banking division saw a 30% year-over-year increase in announced M&A volumes, indicating a resilient dealmaking environment. Asset and Wealth Management achieved record client assets of $1.7 trillion, with continued momentum in alternatives and long-term fee-based net inflows. The firm set a new record for total assets under supervision at $3.3 trillion, marking the 30th consecutive quarter of long-term fee-based net inflows. The Board approved a 33% increase in the quarterly dividend, reflecting confidence in the firm's financial durability and commitment to returning capital to shareholders. Negative Points Despite strong performance, there is ongoing uncertainty in industries sensitive to trade policy, which could impact future results. The company faces challenges in the harvesting environment for private equity-type portfolio assets, which may affect future returns. Geopolitical concerns, particularly in the Middle East, and unresolved trade agreements pose risks to the global economic outlook. The firm is navigating a complex regulatory environment, with ongoing discussions around capital requirements and stress testing transparency. There is a need for more transparency in the capital process, which currently lacks clarity and affects strategic planning. Q & A Highlights Q: What will Goldman Sachs do with its excess capital now that regulatory reforms have been implemented? A: David Solomon, Chairman and CEO, stated that the first priority is to deploy capital towards client franchises to produce accretive returns and support client activity. Opportunities are seen in M&A and financing. After that, the focus will be on returning capital to shareholders through dividends and buybacks. Q: How is Goldman Sachs handling the challenging environment for harvesting historical principal investments? A: Denis Coleman, CFO, explained that while asset prices and credit markets are improving, the environment for harvesting private equity-type assets remains challenging. The firm is committed to reducing historical principal investments, which now stand at about $8 billion, and will continue to do so as market conditions allow. Q: What is Goldman Sachs' approach to capital deployment opportunities, particularly regarding inorganic acquisitions? A: David Solomon emphasized that while the firm is always looking for ways to accelerate its franchise, especially in Asset and Wealth Management, the bar for significant acquisitions is very high. Opportunities must align with strategic priorities and offer a high level of confidence in the people and cultural fit. Q: How does Goldman Sachs view the impact of AI on efficiency and growth? A: David Solomon highlighted that AI presents a significant opportunity to automate processes, create efficiency, and drive productivity. The firm is investing in AI to enhance software development and client service, which will lead to both cost savings and growth opportunities. Q: What is Goldman Sachs' outlook on M&A activity, and what gives them confidence in this area? A: David Solomon noted that announced M&A is up 30% year-over-year, and the backlog driven by Advisory growth is strong. The level of dialogue with clients has increased significantly, and there is confidence in regulatory environments allowing for significant industry consolidation. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. 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
Yahoo
17-07-2025
- Business
- Yahoo
The Goldman Sachs Group Inc (GS) Q2 2025 Earnings Call Highlights: Record Revenues and ...
Net Revenues: $14.6 billion for the second quarter. Earnings Per Share (EPS): $10.91. Return on Equity (ROE): 12.8% for the quarter, 14.8% for the first half of the year. Global Banking and Markets Revenues: $10.1 billion for the quarter. Advisory Revenues: $1.2 billion, up 71% year-over-year. Equity Underwriting Revenues: $428 million, flat year-over-year. Debt Underwriting Revenues: $589 million, down 5% year-over-year. FICC Net Revenues: $3.5 billion, up 9% year-over-year. Equities Net Revenues: $4.3 billion, a record for the quarter. Asset and Wealth Management Revenues: $3.8 billion. Management and Other Fees: $2.8 billion, up 11% year-over-year. Private Banking and Lending Revenues: $789 million, up 12% year-over-year. Total Assets Under Supervision: $3.3 trillion, a record high. Alternative Assets Under Supervision: $355 billion. Net Interest Income: $3.1 billion for the second quarter. Total Loan Portfolio: $217 billion at quarter-end. Operating Expenses: $9.2 billion for the quarter. Effective Tax Rate: 20.2% for the first half of 2025. Capital Returned to Shareholders: $4 billion, including $957 million in dividends and $3 billion in stock repurchases. Common Equity Tier 1 Ratio: 14.5% at the end of the second quarter. Warning! GuruFocus has detected 10 Warning Signs with GS. Release Date: July 16, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points The Goldman Sachs Group Inc (NYSE:GS) reported strong financial performance in Q2 2025 with net revenues of $14.6 billion and earnings per share of $10.91. The company's Investment Banking division saw a 30% year-over-year increase in announced M&A volumes, indicating a resilient dealmaking environment. Asset and Wealth Management achieved record client assets of $1.7 trillion, with continued momentum in alternatives and long-term fee-based net inflows. The firm set a new record for total assets under supervision at $3.3 trillion, marking the 30th consecutive quarter of long-term fee-based net inflows. The Board approved a 33% increase in the quarterly dividend, reflecting confidence in the firm's financial durability and commitment to returning capital to shareholders. Negative Points Despite strong performance, there is ongoing uncertainty in industries sensitive to trade policy, which could impact future results. The company faces challenges in the harvesting environment for private equity-type portfolio assets, which may affect future returns. Geopolitical concerns, particularly in the Middle East, and unresolved trade agreements pose risks to the global economic outlook. The firm is navigating a complex regulatory environment, with ongoing discussions around capital requirements and stress testing transparency. There is a need for more transparency in the capital process, which currently lacks clarity and affects strategic planning. Q & A Highlights Q: What will Goldman Sachs do with its excess capital now that regulatory reforms have been implemented? A: David Solomon, Chairman and CEO, stated that the first priority is to deploy capital towards client franchises to produce accretive returns and support client activity. Opportunities are seen in M&A and financing. After that, the focus will be on returning capital to shareholders through dividends and buybacks. Q: How is Goldman Sachs handling the challenging environment for harvesting historical principal investments? A: Denis Coleman, CFO, explained that while asset prices and credit markets are improving, the environment for harvesting private equity-type assets remains challenging. The firm is committed to reducing historical principal investments, which now stand at about $8 billion, and will continue to do so as market conditions allow. Q: What is Goldman Sachs' approach to capital deployment opportunities, particularly regarding inorganic acquisitions? A: David Solomon emphasized that while the firm is always looking for ways to accelerate its franchise, especially in Asset and Wealth Management, the bar for significant acquisitions is very high. Opportunities must align with strategic priorities and offer a high level of confidence in the people and cultural fit. Q: How does Goldman Sachs view the impact of AI on efficiency and growth? A: David Solomon highlighted that AI presents a significant opportunity to automate processes, create efficiency, and drive productivity. The firm is investing in AI to enhance software development and client service, which will lead to both cost savings and growth opportunities. Q: What is Goldman Sachs' outlook on M&A activity, and what gives them confidence in this area? A: David Solomon noted that announced M&A is up 30% year-over-year, and the backlog driven by Advisory growth is strong. The level of dialogue with clients has increased significantly, and there is confidence in regulatory environments allowing for significant industry consolidation. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. 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
Globe and Mail
16-07-2025
- Business
- Globe and Mail
BAC Q2 Earnings Beat on Robust Trading & NII Growth, Stock Rises
Bank of America 's BAC second-quarter 2025 earnings of 89 cents per share surpassed the Zacks Consensus Estimate of 86 cents. The bottom line compared favorably with earnings of 83 cents in the prior-year quarter. BAC shares gained 1.3% in early trading in response to the better-than-expected quarterly results. A full day's trading session will depict a clearer picture. Behind BAC's Headline Numbers Bank of America recorded an improvement in trading numbers for the 13th straight quarter. Sales and trading revenues, excluding net DVA, grew 14.9% year over year to $5.38 billion. Fixed-income trading fees increased 18.6%, while equity trading income rose 9.6%. We had projected sales and trading revenues (excluding net DVA) of $4.92 billion. This, along with higher net interest income (NII), was the major revenue growth driver for Bank of America. NII grew on a year-over-year basis as fixed-rate asset repricing, and deposit and loan growth were partially offset by the impacts of lower interest rates. However, the investment banking (IB) performance was subdued once again. IB fees (in the Global Banking division) of $767 million declined 8.1% year over year. Equity and debt underwriting income declined 13.3% and 4.7%, respectively. Advisory revenues were down 9.6%. Provisions and non-interest expenses increased in the quarter on a year-over-year basis. The company's net income applicable to common shareholders grew 3.7% from the prior-year quarter to $6.83 billion. Our estimate for the metric was $6.76 billion. BAC's Revenues Improve, Expenses Rise Net revenues were $26.46 billion, which missed the Zacks Consensus Estimate of $26.59 billion. However, the top line increased 4.3% from the prior-year quarter. NII (fully taxable-equivalent basis) grew 6.9% year over year to $14.82 billion. Our estimate for NII was $14.93 billion. Net interest yield expanded 1 basis point to 1.94%. We expected the metric to be 2.03%. Non-interest income increased 1% from the prior-year quarter to $11.79 billion. This was driven by higher total fees and commissions. We had projected non-interest income of $11.78 billion. Non-interest expenses were $17.18 billion, up 5.4% year over year. The rise was due to an increase in almost all cost components except for professional fees. Our estimate for non-interest expenses was $16.96 billion. The efficiency ratio was 64.93%, up from 64.26% in the year-ago quarter. A rise in the efficiency ratio indicates a deterioration in profitability. Bank of America's Credit Quality: A Mixed Bag Provision for credit losses was $1.59 billion, up 5.6% from the prior-year quarter. We estimated the metric to be $1.54 billion. Net charge-offs declined marginally year over year to $1.53 billion. As of June 30, 2025, non-performing loans and leases as a percentage of total loans were 0.52%, unchanged year over year. BAC's Capital Position Strong Book value per share as of June 30, 2025, was $37.13 compared with $34.39 a year ago. Tangible book value per share was $27.71, up from $25.37 a year ago. At the end of June 2025, the common equity tier 1 capital ratio (advanced approach) was 13%, compared with 13.5% as of June 30, 2024. BAC's Share Repurchase Update In the reported quarter, the company repurchased shares worth $5.3 billion. Our Take on Bank of America Bank of America's focus on digitizing and expanding operations, decent loan growth and relatively higher interest rates are likely to keep supporting growth. However, elevated expenses and a challenging operating backdrop pose major headwinds. Currently, BAC carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Performance & Earnings Release Date of BAC's Peers Solid trading and IB performance, and impressive growth in credit card and wholesale loans drove JPMorgan 's JPM second-quarter 2025 adjusted earnings of $4.96 per share. The bottom line handily surpassed the Zacks Consensus Estimate of $4.51. This excluded an income tax benefit of $774 million. Including the one-time gain, JPMorgan's earnings were $5.24 per share. Markets revenues exceeded management's expectations of growth in the mid to high-single-digit range. The metric jumped 15% year over year to $8.9 billion. JPMorgan's IB business performance was also far more robust than expected by management. Total IB fees (in the Commercial & Investment Bank segment) were up 7% from the prior-year quarter to $2.51 billion. Truist Financial Corporation TFC is slated to report quarterly results on July 18. The Zacks Consensus Estimate for Truist's second-quarter earnings has been revised downward over the past seven days. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.) Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Truist Financial Corporation (TFC): Free Stock Analysis Report
Yahoo
16-07-2025
- Business
- Yahoo
Goldman Sachs Q2 Assets Under Supervision Hit Record, Net Interest Income Surges 56%
Goldman Sachs Group Inc. (NYSE:GS) shares traded higher Wednesday after the firm reported second-quarter results that beat analyst expectations, boosted by robust gains in its global banking and trading divisions. Net revenue rose 15% year over year to $14.58 billion, topping the consensus estimate of $13.36 billion, though it declined 3% from the prior quarter. GAAP earnings came in at $10.91 per share, up from $8.62 a year ago and above the $9.48 consensus. First-half EPS rose to $25.07 from $20.21 a year for credit losses increased to $384 million, compared with $282 million a year ago and $287 million last quarter, driven by credit card charge-offs and portfolio growth. Global Banking and Markets revenue jumped 24% to $10.12 billion, led by a 26% rise in investment banking fees and strong performance in FICC (up 9%) and equities (up 36%). Asset and Wealth Management revenue declined 3% to $3.78 billion due to lower returns from equity and debt investments, partially offset by higher fees and lending income. Wealth management client assets totaled approximately $1.7 trillion. Platform Solutions revenue edged up 2% to $685 million, as gains in consumer platforms were offset by softer transaction banking results. Operating expenses climbed 8% to $9.24 billion, driven by higher compensation and transaction-based costs. The firm's efficiency ratio improved to 62.0% for the first half, down from 63.8% a year ago. Assets Under Supervision (AUS) hit a record $3.29 trillion, up $120 billion in the quarter, aided by market appreciation and $5 billion in net inflows. Loans rose quarter over quarter, with an average balance of $215 billion. Loan loss reserves totaled $5.29 billion, split between wholesale ($2.82 billion) and consumer ($2.47 billion). Net Interest Income surged 56% to $3.10 billion, driven by lower funding costs, on $1.65 trillion in average interest-earning assets. Goldman returned $3.96 billion to shareholders during the quarter, including $3 billion in buybacks and $957 million in dividends. View more earnings on GS On July 14, the Board increased the quarterly dividend to $4.00 per common share from $3.00, payable on September 29, 2025, to common shareholders of record on August 29, 2025. The firm's Standardized CET1 capital ratio stood at 14.5%, while the Advanced CET1 ratio declined to 15.5%. Return on average common equity was 12.8% for the quarter and 14.8% for the first half. Book value per share rose 1.6% to $349.74 in the second quarter, up 3.9% year to date. David Solomon, Chairman and CEO of Goldman Sachs, commented, "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. Given the strategic decisions and investments we've made, we continue to believe that the firm is well-positioned to perform for our shareholders." Price Action: GS shares were up 0.78% at $708 in premarket trading on Wednesday at last check. Read Next:Photo by ioda via Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Goldman Sachs Q2 Assets Under Supervision Hit Record, Net Interest Income Surges 56% originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. 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
Globe and Mail
14-07-2025
- Business
- Globe and Mail
Goldman's Q2 Earnings on the Deck: Here's How to Play the Stock Now
The Goldman Sachs Group, Inc. GS is scheduled to release second-quarter 2025 earnings on July 16 before the opening bell. In the first quarter of 2025, Goldman's results benefited from solid growth in the Global Banking & Markets division. Yet, the decline in investment banking (IB) business and the rise in expenses were concerning. Goldman has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in the trailing four quarters, with an average earnings surprise of 20.74%. Earnings Surprise History Let us see how GS is expected to fare in terms of revenues and earnings this time around. The Zacks Consensus Estimate for second-quarter 2025 revenues is pegged at $13.50 billion, calling for a 6.1% rise from the year-ago quarter's reported figure. In the past seven days, the consensus estimate for quarterly earnings has been revised upward to $9.43 per share. The projection suggests a rally of 9.4% from the year-ago quarter's reported figure. Estimate Revision Trend Factors to Shape GS's Q2 Results Market-Making Revenues: The second quarter saw solid client activities and market volatility, driven by tariff-induced market uncertainty. Additionally, volatility was high in equity markets and other asset classes, including commodities, bonds and foreign exchange. Therefore, Goldman's market-making revenues are likely to have witnessed a rise in the quarter to be reported. IB Fees: Global mergers and acquisitions (M&As) in the second quarter of 2025 were impressive than previously expected. Markets plunged in early April after Trump announced sweeping tariffs, rattling business confidence. But as trade demands eased and policy direction became clearer, deal-making activities resumed in the last month of the quarter. Goldman's leadership in the IB space is also likely to have supported advisory fees to some extent. The IPO market in the second quarter saw a resurgence, with a significant increase in the number of IPOs and the amount of capital raised. This was driven by several factors, including strategic tariff pauses and positive economic data, which resulted in a rebound in market sentiment. Further, global bond issuance volume was decent. As such, GS's leadership position in worldwide announced and completed M&As, equity and equity-related offerings, and common stock offerings is likely to have provided it an edge over its peers, offering support to the company's quarterly IB revenues. The Zacks Consensus Estimate for IB revenues is pegged at $1.99 billion, suggesting a 14.8% rise from the year-ago quarter's actual. Net Interest Income (NII): Despite an uncertain macroeconomic backdrop because of Trump's tariff plans, the lending scenario was impressive in the second quarter. Per the Fed's latest data, the demand for overall loans was solid in the second quarter. This is likely to have aided Goldman's loan growth. In the second quarter, the Federal Reserve kept interest rates unchanged at 4.25-4.5%. This is likely to have offered some support to Goldman's NII as the funding/deposit costs stabilized. The Zacks Consensus Estimate for NII is pegged at $2.87 billion, suggesting a 28.3% rise from the year-ago quarter's actual. Expenses: Goldman's investments in technology and market development expenses for business expansion and a rise in transaction-based expenses due to higher client activity are anticipated to have led to increased expenses in the to-be-reported quarter. What Our Model Unveils for Goldman Our proven model does not predict an earnings beat for Goldman this time. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. That is not the case here, as you can see below. Goldman has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter. GS carries a Zacks Rank #3 at present. You can see the complete list of today's Zacks #1 Rank stocks here. GS's Price Performance & Valuation In the second quarter of 2025, Goldman's shares outperformed the industry and its close peers, JPMorgan JPM and Morgan Stanley MS. JPM rose 19.8% and MS rallied 22.7% during the same time frame. Price Performance JPMorgan is slated to announce quarterly numbers on July 15, whereas Morgan Stanley is expected to come out with its performance details on July 16. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar. Let us look at the value GS offers investors at the current levels. Currently, Goldman is trading at 14.74X forward 12-month price/earnings (P/E). Meanwhile, the industry's forward earnings multiple sits at 14.66X. The company's valuation looks somewhat expensive compared with the industry average. Price-to-Earnings F12M Its peer, JPMorgan, is trading at a forward 12-month P/E of 14.91X while Morgan Stanley is trading at 15.94X. How to Play Goldman Stock Now GS's efforts to refocus on the IB and trading businesses provide a solid base for growth in the upcoming period. The company plans to ramp up its lending services to private equity and asset managers, and aims to expand internationally. Goldman Asset Management — a unit of GS — intends to expand its private credit portfolio to $300 billion in five years, positioning it for long-term growth. The company's strong liquidity position supports its capital distribution activities. Following the clearing of the Federal Reserve's 2025 stress test, GS plans to hike its dividend by a whopping 33.3% to $4 per share. In the past five years, the company has hiked dividends four times, with an annualized growth rate of 22.04%. Currently, its payout ratio sits at 28% of earnings. While Goldman's solid fundamentals and strong prospects remain promising, investors should not rush to buy the stock. The company's rising expenses and premium valuation warrant caution at the moment. To get clarity and possibly an appealing entry point, those interested in adding the GS stock to their portfolios may be better off waiting until after the quarterly results are released. Also, they should keep an eye on macroeconomic factors that are likely to influence the company's performance. Those who already own the GS stock can consider retaining it because it is less likely to disappoint over the long term. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They include Stock #1: A Disruptive Force with Notable Growth and Resilience Stock #2: Bullish Signs Signaling to Buy the Dip Stock #3: One of the Most Compelling Investments in the Market Stock #4: Leader In a Red-Hot Industry Poised for Growth Stock #5: Modern Omni-Channel Platform Coiled to Spring Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%. Download Atomic Opportunity: Nuclear Energy's Comeback free today. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. The Goldman Sachs Group, Inc. (GS): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Morgan Stanley (MS): Free Stock Analysis Report
