Goldman Sachs Group Inc.’s stock lost ground in premarket trades after the investment bank’s first-quarter revenue fell short of the consensus estimate, while net income beat the Wall Street forecast.
The company’s latest revenue figure included a previously undisclosed loss of about $ 470 million from the partial sale of the loan portfolio of its Marcus consumer-banking business and the transfer of the remainder of the portfolio to held-for-sale.
Goldman Sachs GS, +0.82% said its first-quarter earnings fell to $ 3.09 billion, or $ 8.79 a share, from $ 3.83 billion, or $ 10.76 a share, in the year-ago quarter.
First-quarter revenue dipped to $ 12.22 billion from $ 12.93 billion.
Analysts expected Goldman Sachs to earn $ 8.14 a share on revenue of $ 12.76 billion, according to estimates compiled by FactSet.
Goldman’s results came the same day as Bank of America Corp. BAC, +2.88% reported stronger-than-expected profit and revenue.
CEO David Solomon said the company turned in a “solid” performance despite turmoil in the banking sector in March following the collapse of Silicon Valley Bank SIVBQ, -3.63% and efforts by the banking system to shore up deposits at First Republic Bank FRC, +0.15%.
“The events of the first quarter acted as another real-life stress test, demonstrating the resilience of Goldman Sachs and the nation’s largest financial institutions,” Solomon said.
Solomon credited Goldman’s “deeply rooted risk-management culture, strong liquidity and robust capital position” for allowing it to support its clients during the quarter.
Fixed-income net revenue fell 17% to $ 3.93 billion, which reflected lower net revenue in FICC intermediation. The business also reported lower net revenues in currencies and commodities, partially offset by “significantly higher” interest-rate-product revenue and higher revenue in mortgages and credit products.
Goldman’s $ 470 million loss from the sale of its Marcus loan portfolio was largely offset by a related reserve reduction of about $ 440 million in its provision for credit losses.
Global banking and market revenue fell 16% to $ 8.44 billion. Investment-banking fees fell 26% to $ 1.58 billion. Revenue in equities fell 7% to $ 3.02 billion. Asset- and wealth-management revenue rose 24% to $ 3.22 billion.
Prior to Tuesday’s move, Goldman Sachs’s stock was down 1% in 2023, compared with an 8.1% rise by the S&P 500 SPX, +0.33%.
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