Earnings

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David Solomon, CEO, Goldman Sachs, speaking at the World Economic Forum in Davos, Switzerland, Jan. 23, 2020.
Adam Galacia | CNBC

Goldman Sachs is scheduled to report second-quarter earnings before the opening bell Monday.

Here’s what Wall Street expects:

  • Earnings: $6.58 per share, according to Refinitiv
  • Revenue: $10.86 billion, 29% lower than a year earlier.
  • Trading Revenue: Fixed Income: $2.89 billion, Equities: $2.68 billion, according to StreetAccount.
  • Investment Banking Revenue: $2.07 billion.

Will Goldman’s traders do well enough to offset weak investment-banking results? That’s the question after a mixed series of bank reports so far.

Rivals including JPMorgan Chase and Morgan Stanley posted steep declines in second-quarter advisory revenue. But another Wall Street competitor, Citigroup, saw a 25% jump in trading revenue that helped it top profit expectations.

Goldman tends to outperform other banks during periods of high volatility, which could help the firm. But it is also one of the biggest corporate advisors on Wall Street, and the slowdown in IPOs and mergers has been widespread.

The bank also tends to benefit from rising asset prices through its various investment vehicles, and so broad declines in financial assets could sting the firm. JPMorgan and Wells Fargo each posted writedowns tied to declines in loan books or equity holdings.

Analysts will be keen to ask CEO David Solomon how the deals pipeline looks for the remainder of 2022, and if mergers and IPOs are being killed, or merely pushed back into future quarters.

Goldman shares have fallen 23% this year through Friday, worse than the 16% decline of the KBW Bank Index.

Last week, JPMorgan and Wells Fargo posted second-quarter profit declines as the banks set aside more funds for expected loan losses, while Morgan Stanley disappointed after a bigger-than-expected slowdown in investment banking. Citigroup was the sole firm to top expectations for revenue as it benefited from rising rates and strong trading results.

This story is developing. Please check back for updates.

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