Goldman Sachs beats by $0.56, beats on revs (229.26)
- Reports Q2 (Jun) earnings of $3.95 per share, $0.56 better than the Capital IQ Consensus of $3.39; revenues fell 0.6% year/year to $7.89 bln vs the $7.47 bln Capital IQ Consensus.
- Annualized return on average common shareholders' equity (ROE) was 8.7% for the second quarter
-
Net revenues in Investment Banking were $1.73 billion for the second quarter of 2017, 3% lower than the second quarter of 2016 and 2% higher than the first quarter of 2017.
- Net revenues in Financial Advisory were $749 million, 6% lower than the second quarter of 2016, reflecting a decrease in industry-wide completed mergers and acquisitions.
- Net revenues in Underwriting were $981 million, essentially unchanged compared with the second quarter of 2016.
- Net revenues in debt underwriting were essentially unchanged compared with a strong prior year period.
- Net revenues in equity underwriting were slightly lower, reflecting lower net revenues from convertibles.
- The firm's investment banking transaction backlog increased compared with both the end of the first quarter of 2017 and the end of 2016.
-
Net revenues in Institutional Client Services were $3.05 billion for the second quarter of 2017, 17% lower than the second quarter of 2016 and 9% lower than the first quarter of 2017.
- Net revenues in Fixed Income, Currency and Commodities Client Execution were $1.16 billion for the second quarter of 2017, 40% lower than the second quarter of 2016, due to significantly lower net revenues in interest rate products, commodities, credit products and currencies, partially offset by higher net revenues in mortgages.
- Net revenues in Equities were $1.89 billion for the second quarter of 2017, 8% higher than the second quarter of 2016, primarily due to higher net revenues in equities client execution, reflecting higher results in both cash products and derivatives.
- Net revenues in Investing & Lending were $1.58 billion for the second quarter of 2017, 42% higher than the second quarter of 2016 and 8% higher than the first quarter of 2017.
- Operating expenses were $5.38 billion for the second quarter of 2017, 2% lower than both the second quarter of 2016 and the first quarter of 2017. Non-compensation expenses were $2.15 billion for the second quarter of 2017, essentially unchanged compared with the second quarter of 2016 and 2% lower than the first quarter of 2017. Noncompensation expenses for the second quarter of 2017 included higher brokerage, clearing, exchange and distribution fees, higher market development expenses and Net provisions for litigation and regulatory proceedings for the second quarter of 2017 were $22 million compared with $126 million for the second quarter of 2016.