Goldman Sachs Q3 Revenue Rises 23% on Equities, Banking Strength

Goldman Sachs (GS) reported a 23% year-over-year increase in third-quarter 2026 net revenues to $18.68 billion, its second-highest quarterly total, as strong equities and investment-banking activity drove a 32% rise in Global Banking & Markets revenue. Net earnings increased 29% to $5.29 billion, while diluted earnings per share rose 39% to $17.01.

The firm generated an annualized return on average common equity of 18.7% and an annualized return on average tangible common equity of 20.5%. Charitable contributions of approximately $450 million reduced diluted EPS by about $1.00 and lowered both annualized ROE and ROTE by roughly 1.1 percentage points.

Compared with the second quarter, net revenues declined 8%, net earnings fell 20% and diluted EPS decreased 19%. For the first nine months of 2026, Goldman posted record net revenues of $56.24 billion, up 25% from a year earlier, while net earnings increased 40% to $17.55 billion.

Equities and advisory lead banking performance

Global Banking & Markets produced $13.46 billion of third-quarter net revenues, up 32% year over year but down 13% sequentially. Pre-tax earnings in the segment increased 36% from a year earlier to $5.78 billion, and its return on average common equity was 20.7%.

Equities was the largest growth contributor, with revenue climbing 72% to $6.44 billion. Equities intermediation revenue rose 52% to $3.08 billion, primarily reflecting stronger derivatives activity. Equities financing revenue nearly doubled to a record $3.37 billion, supported by prime financing and portfolio financing.

Investment-banking fees increased 21% to $3.22 billion. Advisory revenue reached a record $1.65 billion as completed mergers and acquisitions volumes increased. Equity underwriting revenue rose 43% to $666 million, reflecting higher revenue from initial public offerings and secondary offerings, while debt underwriting increased 15% to $904 million on stronger investment-grade activity.

The investment-banking fee backlog decreased from the second quarter, primarily because of a decline in advisory. Goldman ranked first in announced and completed M&A and equity and equity-related offerings during the first nine months of 2026, according to data cited in the presentation.

FICC revenue was nearly unchanged at $3.47 billion. Financing revenue increased 14%, driven mainly by mortgages and structured lending, while intermediation revenue fell 7% as weakness in mortgages, credit products and interest-rate products more than offset stronger currencies and commodities revenue.

Asset and wealth management reaches record AUS

Asset & Wealth Management net revenues rose 14% year over year and 10% sequentially to $5.05 billion. Pre-tax earnings increased 14% to $1.32 billion, while the segment’s return on average common equity reached 16.1%.

Management and other fees increased 22% to a record $3.59 billion, primarily because of higher average assets under supervision. Incentive fees rose to $587 million from $76 million a year earlier, driven by fund distributions.

Those gains were partly offset by a 22% decline in private banking and lending revenue to $827 million. The prior-year quarter included interest paid on a previously impaired loan. Investment revenue fell 85% to $50 million, including net markdowns in debt investments compared with net markups a year earlier.

Assets under supervision increased by $56 billion during the quarter to a record $4.10 trillion. The firm recorded $97 billion of long-term net inflows—its 35th consecutive quarter of positive long-term fee-based flows—while liquidity products had $14 billion of net outflows. Net market depreciation totaled $27 billion.

Alternative-investment assets under supervision rose by $32 billion to a record $491 billion. Management and other fees from alternatives increased 43% to $860 million, and gross third-party alternatives fundraising totaled $37 billion during the quarter. Goldman also announced agreements to acquire NEOS Investments and LCN Capital Partners.

Platform Solutions remains a drag

Platform Solutions revenue dropped 72% year over year to $170 million, primarily due to net markdowns related to the Apple Card loan portfolio, which was transferred to held for sale in the fourth quarter of 2025. The segment reported a pre-tax loss of $95 million and a return on average common equity of negative 9.2%.

The presentation cautioned that the planned transition of the Apple Card program may not close on the anticipated timeline or at all if closing conditions are not satisfied.

Higher expenses and credit provisions

Firmwide operating expenses increased 20% year over year to $11.31 billion. Compensation and benefits expense rose 9%, reflecting improved operating performance, while transaction-based expenses increased 54%. Higher charitable contributions also contributed to the increase in non-compensation costs. The year-to-date efficiency ratio improved to 59.4% from 62.1% a year earlier.

The provision for credit losses was $368 million, up 9% year over year and sharply higher than in the second quarter, primarily reflecting impairments related to wholesale loans. Total loans increased to $276 billion from $261 billion at the end of the prior quarter, with 85% of gross loans secured. Third-quarter net charge-offs were $154 million, representing an annualized rate of 0.3%.

Goldman returned $4.49 billion to common shareholders during the quarter through $3.00 billion of share repurchases and $1.49 billion of dividends. Its standardized common equity tier 1 ratio declined to 12.4% from 12.9% in the second quarter, primarily because of higher market and credit risk-weighted assets. The advanced CET1 ratio was unchanged at 13.6%.

Management said the firm remained positioned to serve clients despite a complicated and uncertain operating environment. The presentation identified economic and market conditions, trade policy and tariffs, geopolitical conflict, regulatory-capital changes, transaction completion risk and the Apple Card transition among the uncertainties that could affect future results. Several reported metrics, including assets under supervision, capital ratios and balance-sheet data, were preliminary estimates and may be revised.