Goldman Sachs Group Inc (NYSE:GS) released its second quarter earnings report before opening bell this morning, posting earnings of $3.72 per share on $7.93 billion in revenue. Wall Street was looking for earnings of $3.04 per share and $7.48 billion in revenue. In last year’s second quarter, the firm reported earnings of $1.98 per share on $9.07 billion in revenue.
Goldman Sachs’ equities revenues plunge
The firm’s net earnings were $1.82 billion. Investment Banking revenues declined 11% year over year to $1.79 billion. Financial Advisory revenues fell 3%, while Underwriting revenues declined 17%. Equity underwriting revenues declined significantly, while debt underwriting revenues were much higher due to higher asset-backed activity.
Institutional Client Services net revenues rose 2% year over year to $3.68 billion. Equities revenue declined 12% to $1.75 billion, while FICC client executive revenue surged 20% to $1.93 billion. Analysts had been expecting $1.8 billion in FICC trading revenue. Total trading revenue edged out expectations, coming in at $3.68 billion compared to the consensus of $3.67 billion.
Investing & Lending revenue plunged 38% to $1.11 billion, although this was still a significant recovery from the first quarter of this year. Goldman Sachs said the year over year decline in revenue for this segment came from a large decline in net gains from investments in public and private equities. Investment Management revenues fell 18% year over year to $1.35 billion, which was basically flat with the first quarter of this year. The firm attributed the year over year decline mostly to much lower incentive fees.
Goldman Sachs updates capital position
Goldman Sachs Group Inc (NYSE:GS)’s assets under supervision achieved a new record of $1.31 trillion. Total assets amounted to $897 billion at the end of June, compared to $878 billion at the end of March. Its book value per common share rose 2% to $176.62, while tangible book value per share was $166.90, also a 2% increase. As of the end of June, the firm had a Common Equity Tier 1 Basel III Advanced ratio of 12.2% and Standardized ratio of 13.7%.
Shares of Goldman Sachs Group Inc (NYSE:GS) edged lower by as much as 0.66% to $162.25 in premarket trading this morning.