Goldman Sachs (NYSE:GS) reported third-quarter revenue and profit ahead of expectations, driven by strong trading revenue.
The investment bank said in the third quarter net revenue totalled $11.82 billion, ahead of the $11.19 billion expected, although down from $11.98 billion the year before.
Goldman said net income fell to $2.06 billion from $3.07 billion before, while diluted earnings per share of $5.47 beat forecasts of $5.31, but was down when compared to $8.25 a year ago.
The bank said the results reflected significantly lower net revenues in asset & wealth management, offset by higher net revenues in global banking & markets and platform solutions.
The bank also struck a more optimistic tone on the outlook for the industry.
David Solomon, chairman and chief executive, said: “We’re confident that the work we’re doing now provides us a much stronger platform for 2024. I also expect a continued recovery in both capital markets and strategic activity if conditions remain conducive.”
“As the leader in M&A advisory and equity underwriting, a resurgence in activity will undoubtedly be a tailwind for Goldman Sachs (NYSE:GS),” he said.
Net revenues in global banking & markets were $8.01 billion, 6% higher than the third quarter of 2022, and 11% higher than the second quarter of 2023, driven by strong performances in both fixed income, currency and commodities which included record quarterly net revenues in financing, and equities.
Investment banking fees were $1.55 billion, little changed year-on-year, due to higher net revenues in debt underwriting, primarily driven by leveraged finance activity, and higher net revenues in equity underwriting, primarily from initial public offerings, offset by lower net revenues in advisory.
Net revenues in equities were $2.96 billion, 8% higher than the third quarter of 2022.
Provision for credit losses was $7 million for the quarter, compared with $515 million for the third quarter of 2022 and $615 million for the second quarter of 2023.
Shares in Goldman are up 0.5% in pre-market trading.