Goldman Sachs earnings rise, beating estimates
Wall Street powerhouse Goldman Sachs’ earnings rose in the second quarter, defying pessimistic forecasts betting on a sharp drop-off.
Strong results in Goldman’s investment banking and investing and lending units helped drive the firm’s quarterly earnings to $2.04 billion in the second quarter, up from $1.93 billion a year earlier.
Earnings per share were $4.10 a share compared with $3.70 in the same quarter last year. Analysts had estimated $3.03 a share, according to Thomson Reuters survey.
Revenues rose 6% from a year ago to $9.13 billion. Investment banking revenues rose 15% to $1.78 billion. Revenue in Goldman’s investing and lending business was $2.07 billion, up 46%.
The investment bank saw a 6% year-over-year increase in compensation and benefits, its biggest expense, to $3.92 billion for the quarter. Total staff increased 2% from a year ago to 32,400, but that number was down 1% from the first quarter.
For the first half of 2014, the firm said it paid an effective tax rate of 30.3%, down from 32.7% in the same period last year, due to its decision to permanently invest some non-U.S. earnings abroad and a change in the composition of its earnings.
“We are pleased with our results for the quarter in the context of mixed operating conditions during the period,” said CEO Lloyd Blankfein. “This performance was driven by the diversity, strength and breadth of our global client franchise. Good client activity in Investment Banking and Investment Management as well as a better environment for our Investing & Lending activities helped offset less favorable conditions for Institutional Client Services.”
Source: Usatoday
