Core Insights - Goldman Sachs is transitioning towards capital-light platforms and financing businesses as key drivers for sustainable, technology-enabled growth [1][6] - The firm has signed an agreement to transition the Apple Card portfolio to JPMorgan, indicating a strategic shift away from consumer balance-sheet businesses [2][10] - Management anticipates increased client activity and technology-enabled scale will drive momentum into 2026 [3] AI and Automation - AI is becoming central to Goldman's operations, with a focus on enhancing productivity rather than being an experimental tool [4] - The launch of One Goldman Sachs 3.0, powered by Ella AI, aims to improve efficiency, client experience, and profitability [5] - Six initial workstreams have been identified for AI-driven automation, including client onboarding and regulatory reporting [5] Financial Performance - Durable financing revenues in FICC and equities reached a record $11.4 billion in 2025, growing at a 17% compound annual rate since 2021 [7] - The transition of the Apple Card portfolio resulted in a $2.3 billion reduction in Platform Solutions revenues, but was offset by a $2.5 billion reserve release, leading to a net positive effect on earnings [10] Strategic Focus - The transition of the Apple Card reflects a broader effort to reduce capital intensity and focus on higher-return, technology-enabled businesses [11] - The future of Apple Savings remains uncertain, with management emphasizing a reassessment of consumer-facing deposit strategies [12][13] - Goldman expects to redirect capital towards technology and platforms intersecting with institutional finance, including tokenization and AI-driven platforms [14][15] Market Outlook - Solomon indicated that technology investments are aimed at raising the firm's performance across market cycles, with high levels of client engagement expected to continue [16]

Financial Data and Key Metrics Changes - In Q4 2025, the company generated earnings per share (EPS) of $14.01, with a return on equity (ROE) of 16% and a return on tangible equity (ROTE) of 17.1% [3][23] - For the full year, EPS was $51.32, representing a 27% increase compared to the previous year, with an ROE of 15% and an ROTE of 16%, improving by 230 and 250 basis points respectively [3][23] - Total revenues for Q4 were $13.5 billion, and for the full year, revenues reached $41.5 billion, an 18% increase year-over-year [23][24] Business Line Data and Key Metrics Changes - Global Banking and Markets (GBM) produced record revenues of $41.5 billion for the year, with investment banking fees of $2.6 billion in Q4, up 25% year-over-year [24][26] - FICC net revenues were $3.1 billion in Q4, a 12% increase year-over-year, while equities net revenues reached $4.3 billion, with equities financing results hitting a record of $2.1 billion, up 42% year-over-year [26][27] - Asset and Wealth Management (AWM) revenues were $16.7 billion for 2025, with a pre-tax margin of 25% and total assets under supervision reaching a record $3.6 trillion [27][28] Market Data and Key Metrics Changes - The investment banking backlog rose for the seventh consecutive quarter to a four-year high, primarily driven by advisory activities [25][68] - The company maintained its number one position in M&A advisory and ranked first in leverage lending, with a strong outlook for 2026 [24][25] Company Strategy and Development Direction - The company aims to narrow its strategic focus and has made organizational changes to enhance its segments [24] - The firm is committed to diversifying its funding footprint and has improved its funding structure, with deposits growing to $501 billion, representing approximately 40% of total funding [19] - The introduction of One Goldman Sachs 3.0, an operating model propelled by AI, aims to enhance efficiency and accountability across the organization [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the firm's ability to exceed return targets, citing a strong growth trajectory and a favorable investment banking environment for 2026 [22][31] - The company is optimistic about the potential for M&A and capital markets activity, supported by fiscal and monetary stimulus [56][57] - Management remains cautious about external factors that could impact the operating environment, including economic growth and geopolitical developments [30][31] Other Important Information - The company announced a $0.50 increase in its quarterly dividend to $4.50, a 50% increase from the previous year, and has $32 billion of remaining buyback capacity [17][30] - The firm has a strong capital position, with a common equity tier one ratio of 14.4% at the end of Q4 [30] Q&A Session Summary Question: How does the company plan to scale wealth management? - Management highlighted the strength of its ultra-high net worth franchise and plans to expand through third-party wealth channels, including partnerships with RIAs [34][36] Question: What is the level of confidence in maintaining mid-teens returns? - Management believes they have significantly raised the floor for returns, with durable revenues expected to be less affected by downturns [40][41] Question: Is there potential for transformational M&A? - Management stated that while they are open to opportunities, the bar for significant acquisitions remains high due to cultural integration concerns [49][51] Question: What is the current state of the capital market cycle? - Management indicated that they believe the capital markets environment is set up to be constructive for 2026, with potential for M&A activity to exceed previous highs [55][56] Question: How does the company view its buyback strategy? - Management confirmed that buybacks remain an important part of their capital deployment strategy, especially given their excess capital position [62][63]

Financial Data and Key Metrics Changes - In Q4 2025, the company generated earnings per share (EPS) of $14.01, with a return on equity (ROE) of 16% and a return on tangible equity (ROTE) of 17.1% [3][26] - For the full year, EPS was $51.32, representing a 27% increase compared to the previous year, with an ROE of 15% and an ROTE of 16%, improving by 230 and 250 basis points respectively [3][26] - Total revenues for Q4 were $13.5 billion, with full-year revenues reaching $41.5 billion, an 18% increase year-over-year [26][27] Business Line Data and Key Metrics Changes - Global Banking & Markets (GBM) produced record revenues of $41.5 billion for the year, with investment banking fees of $2.6 billion in Q4, up 25% year-over-year [27][29] - FICC net revenues were $3.1 billion in Q4, up 12% year-over-year, while equities net revenues reached $4.3 billion, with equities financing results hitting a quarterly record of $2.1 billion, up 42% year-over-year [29][30] - Asset & Wealth Management (AWM) revenues were $16.7 billion for 2025, with a pre-tax margin of 25% and record management fees of $3.1 billion in Q4, up 10% year-over-year [30][31] Market Data and Key Metrics Changes - The investment banking backlog rose for the seventh consecutive quarter to a four-year high, primarily driven by advisory activities [29][72] - Total assets under supervision in AWM reached a record $3.6 trillion, driven by $66 billion of long-term fee-based net inflows [31][32] - Alternative assets under supervision totaled $420 billion at the end of Q4, contributing to $645 million in management fees [32] Company Strategy and Development Direction - The company aims to continue executing its strategy to grow and strengthen its position as a leading financial institution, focusing on client service, integrity, and excellence [4][5] - The firm is narrowing its strategic focus, including the transition of the Apple Card portfolio and enhancing its wealth management capabilities through partnerships with RIAs [7][18] - The introduction of One Goldman Sachs 3.0, an operating model propelled by AI, aims to improve efficiency and accountability across the organization [23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the investment banking outlook for 2026, citing catalysts such as corporate strategic repositioning and increased sponsor activity [9][60] - The company believes it has raised the floor for returns significantly, with a focus on durable revenues that are less affected by market downturns [43][44] - Management remains cautious about potential economic shifts and geopolitical developments that could impact the operating environment [33][34] Other Important Information - The company announced a $0.50 increase in its quarterly dividend to $4.50, representing a 50% increase from the previous year, and has $32 billion of remaining buyback capacity [19][33] - The firm has diversified its funding structure, with deposits growing to $501 billion, representing approximately 40% of total funding [21][22] Q&A Session Summary Question: How does the company plan to scale wealth management? - Management highlighted the strength of its ultra-high net worth franchise and plans to expand through third-party wealth channels, including partnerships with RIAs [37][39] Question: What is the level of confidence in maintaining mid-teens returns? - Management expressed confidence in having raised the floor for returns significantly, with a focus on durable revenues and a diversified business model [42][44] Question: Is there potential for transformational M&A? - Management indicated that while the bar for significant acquisitions is high, they are open to opportunities that align with their strategic goals [52][54] Question: What is the current state of the capital market cycle? - Management believes the environment is set up for constructive M&A and capital markets activity in 2026, with potential for exceeding previous activity levels [58][60] Question: How does the company view its buyback strategy? - Management confirmed that buybacks remain an important part of their capital deployment strategy, balancing between supporting client activity and driving shareholder returns [65][66]

Group 1: Market Reactions and Stock Performance - Defense contractors, particularly RTX Corp., experienced a decline in stock prices due to an executive order banning excessive CEO compensation, large dividends, and stock buybacks [3][4]. - RTX shares fell 2.5% on January 7, with the iShares U.S. Aerospace and Defense ETF also declining by 1.5% on the same day [5]. - Both RTX and the ETF have since recovered their losses, with RTX up 4.5% from its January 7 close, reaching a 52-week high of $197.55 on January 13 [6]. Group 2: Broader Market Trends - The S&P 500 Index experienced a significant drop of 10.5% following the announcement of tariffs in April 2025 but later recovered, ending 2025 with a 17.3% gain and showing a 1.73% increase in early 2026 [7][8]. - The resilience of stocks suggests that investors should remain patient and avoid hasty decisions during market fluctuations [9]. Group 3: Regulatory and Political Developments - Federal Reserve Chairman Jerome Powell is under criminal investigation, which has implications for financial institutions as it relates to interest rate policies [10]. - President Trump's proposal to lower credit card interest rates to 10% for a year has negatively impacted credit card companies, with Synchrony seeing a decline of 10.2% since January 9 [10].

Core Insights - JPMorgan Chase will replace Goldman Sachs as the issuer of the Apple Card, with the transition expected to take place in about two years [2][8] - Consumers' existing Apple credit-card and savings balances, payment history, credit limit, and Daily Cash balance will carry over during the transition [3][8] Group 1: Transition Details - The transition will affect who holds the money and services the accounts for Apple Card and Apple Savings users, but balances and rewards are expected to move automatically [4] - Current Apple Card customers will have the option to open an Apple Savings account with JPMorgan or retain their existing account with Goldman Sachs [5][8] Group 2: Account Features - The current Apple Savings account has no monthly fees or minimum balance requirements and is federally insured for balances up to $250,000, offering a 3.65% APY [6] - Chase does not currently offer a high-yield savings account but plans to develop its own savings product in association with the Apple Card [6] Group 3: Payment Network and Terms - Mastercard will continue as the payment network for the Apple Card, and no changes to the terms of the Apple Card are expected [7] - Credit reports will be updated to reflect Chase as the issuing bank, with further details to be communicated to users as the transition date approaches [7]