Goldman’s profit tops estimates on trading boom, corporate deal spree

By Saeed Azhar and Niket Nishant

July 14 (Reuters) – Goldman Sachs exceeded second-quarter profit expectations, as dealmaking picked up pace and market volatility due to the Middle East war boosted the equities business to a record.

Inflation risks and uncertainty over interest rates kept investors on edge, resulting in aggressive portfolio reassessment and stronger revenue from equities trading desks.

Some analysts said SpaceX’s IPO may have provided an additional lift to volumes. Goldman was one of the lead underwriters for the much-anticipated IPO.

The equities business fetched revenue of $7.42 billion, surging 72% from a year ago. The fixed income, currency and commodities business revenue also jumped 32% to $4.59 billion.

“Momentum has accelerated throughout our businesses. Clients are turning to us to lead their most strategic and consequential transactions, which are often the genesis of activity across the franchise,” CEO David Solomon said in a statement.

“We expect this flywheel of activity to continue,” he said.

Total profit for the bank was $6.63 billion, or $20.98 per share, for the three months ended June 30. That compares with $3.72 billion, or $10.91 per share, a year earlier. Analysts were expecting earnings of $14.48, according to data compiled by LSEG.

The strong results may provide fresh support for Goldman shares, which have outperformed the benchmark S&P 500 index this year but stirred some concerns about how much further the stock can run.

Shares of the Wall Street titan were up 2.7% in premarket trading.

CORPORATE GIANTS’ SHOPPING SPREE BOOSTS ADVISORY

A surge in $10-billion-plus “mega-deals” drove global M&A volumes to record levels in the first half of 2026, according to LSEG data, helping investment banks such as Goldman that earn fees from advising on such transactions.

Goldman’s investment banking fees rose 55% to $3.40 billion in the quarter, helped by higher stock and debt sales, as well as a stronger advisory arm.

Corporate dealmaking remained resilient despite the turmoil in the Middle East, driven in part by companies’ efforts to expand and strengthen their AI businesses.

In May, Goldman’s president John ‌Waldron said the M&A volumes were set to end the year near the record levels seen in 2021.

Goldman advised on more than $1 trillion worth of announced mergers and ​acquisitions in the first half of 2026, marking a record pace for ‌any investment bank.

The results are part of a busy Tuesday lineup of Wall Street earnings that investors will parse for signals on where the economy is headed, and to gauge the outlook for bank stocks, which BofA analysts said had been an “island of stability” even as fears of AI disruption rocked the financial industry.

Goldman’s peers JPMorgan Chase and Bank of America also reported higher quarterly profits.

The results also usher in an earnings season that investors have been eagerly awaiting in the hope that it may redirect attention from geopolitical noise to corporate fundamentals.

ASSET MANAGEMENT ARM DODGES PRIVATE CREDIT STRAIN

Goldman’s asset and wealth management revenue rose 20% to $4.60 billion, continuing its strong run.

The bank has pushed for a stronger footing in the business to build a steadier earnings base and reduce its dependence on the trading and investment banking arms, which are more volatile.

Goldman’s private credit fund, which is part of the asset and wealth management division, has so far bucked the weakness in the industry.

Private credit players have come under pressure from shareholders looking to redeem their shares, on concerns that AI could disrupt the business models of software companies held in their portfolios.

GS Credit, however, said earlier this month that second-quarter repurchase requests were below its 5% cap.

(Reporting by Niket Nishant in Bengaluru and Saeed Azhar in New York; Editing by Arun Koyyur)