Goldman Q4 Earnings Top Estimates on Solid IB Fees, Stock Gains

Core Insights - Goldman Sachs Group, Inc. (GS) reported fourth-quarter 2025 earnings per share of $14.01, exceeding the Zacks Consensus Estimate of $11.77 and up from $11.95 in the same quarter last year [1] Revenue Performance - Net revenues in Equities increased by 25% year over year to $4.31 billion, while Fixed Income, Currency, and Commodities trading revenues rose 12% to $3.11 billion [2] - Investment banking fees surged 25% to $2.58 billion, with advisory fees seeing a remarkable 41% increase due to higher completed mergers and acquisitions [2][9] - Overall net revenues fell 3% to $13.45 billion for the quarter, missing the Zacks Consensus Estimate of $13.61 billion, primarily due to weakness in Platform Solutions [5] Earnings and Expenses - Net earnings attributable to common shareholders were $4.38 billion, a 12% increase year over year, with full-year earnings per share of $51.32 surpassing the Zacks Consensus Estimate of $49.12 [4] - Total operating expenses rose 18% year over year to $9.72 billion, driven by higher compensation and transaction-based expenses [6] Segment Performance - The Asset & Wealth Management division generated revenues of $4.72 billion, down 1% year over year, while firmwide assets under supervision increased by 14.9% to $3.6 trillion [7] - The Global Banking & Markets division recorded revenues of $10.41 billion, up 22% year over year, supported by strong performances in Equities and Fixed Income [8] Capital and Distribution - As of December 31, 2025, the Common Equity Tier 1 capital ratio was 14.4%, down from 15% a year earlier, and the supplementary leverage ratio was 5.2%, down from 5.5% [10] - In the reported quarter, GS returned $16.78 billion to common shareholders, including $12.36 billion in share repurchases and $4.42 billion in dividends [11] Overall Assessment - The results reflect continued strength in trading and investment banking, supported by active client engagement and improving deal activity [12] - Elevated expenses and challenges in Platform Solutions remain concerns, but the firm's robust capital position and diversified revenue base position it well for long-term growth [13]