Goldman’s profit tops estimates as market turbulence powers record equities revenue

NEW YORK: Goldman Sachs’ second-quarter profit exceeded Wall Street expectations, as turbulent markets raised revenue in its equities division to a record, and a pickup in dealmaking boosted investment banking. The results capture a growing trend of market turmoil boosting trading desks across Wall Street as investors rebalance their portfolios to manage tariff-related risks.

Goldman’s equities revenue rose 36% to $4.3 billion, higher than the $3.6 billion analysts were expecting, according to estimates compiled by LSEG.

Fixed income, currencies, and commodities business hauled in $3.47 billion, 9% higher than a year ago. Financing revenue in both equities and FICC hit a record.

While shifting tariff risks kept some companies on the sidelines, pent-up demand for dealmaking triggered a flurry of acquisitions.

Still, trade policy uncertainty in recent weeks has revived concerns about how long the momentum would last. Goldman’s peers JPMorgan Chase and Citigroup reported strong growth in investment banking fees, while Morgan Stanley and Bank of America posted declines.

“A narrowed range of outcomes on trade and the overall economy has helped CEO confidence and increased their willingness to transact. We’ve seen a pickup in momentum with both strategic and sponsor clients,” Goldman CEO David Solomon said.

Goldman’s investment banking fees stood at $2.19 billion, rising 26% from a year ago. Analysts were expecting a nearly 10% jump.

The bank remained the top adviser by deal value on mergers and acquisitions globally in the second quarter, according to Dealogic data. It advised Holcim on the spinoff of its North American business Amrize, now valued at $28 billion. It also worked with Informatica, which was bought by Salesforce for about $8 billion.

“The well-above consensus rise in investment banking was (a surprise), with a lot of analysts snookered into thinking that macro uncertainty would hold back this line item more than it did,” said Stephen Biggar, director of financial services research at Argus Research.

Advisory fees were significantly higher due to strength in the Americas and Europe, the Middle East, and Africa, the bank said.