Goldman Sachs posts higher Q1 profit of US$5.4 billion on strength in dealmaking, equities trading
A landmark deal in Q1 entailed advising Unilever on the merger of its food business with spicemaker McCormick
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[NEW YORK] Goldman Sachs posted a rise in first-quarter profit on Monday (Apr 13), as the Wall Street bank benefited from strength in dealmaking and equities trading.
Global markets have been roiled by the Iran war, as rising crude oil prices fan inflation fears and exacerbate worries about a recession.
The heightened volatility in asset classes has pushed up the need for clients to reassess portfolios and hedge downside risks, a practice that typically buoys trading desks at large banks.
Goldman Sachs CEO David Solomon said: “The geopolitical landscape remains very complex – so disciplined risk management must remain core to how we operate.”
The bank’s revenue from equity-trading intermediation and financing rose 27 per cent to a record US$5.33 billion.
Meanwhile, the revenue from fixed income, currencies and commodities fell 10 per cent to US$4.01 billion.
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Net profit jumped to US$5.4 billion, or US$17.55 a share, compared with US$4.58 billion, or US$14.12 a share from the year-ago period.
M&A market resilient
Wall Street executives expect a strong year for mergers and acquisitions (M&A) despite the current uncertainty from the Middle East conflict.
This is due to a softer stance on regulations under US President Donald Trump’s administration and the artificial intelligence boom being likely to underpin much of the activity.
Global M&A volumes hit US$1.4 trillion in the first quarter, the data compiled by fintech company Dealogic showed.
Analysts at Jefferies noted that global M&A proxy fees rose 19 per cent year on year to US$11.3 billion, with Goldman leading the pack in market share.
The investment bank worked on some large deals in the first quarter, including advising Unilever on the merger of its food business with herbs and spices brand McCormick to create a US$65 billion company.
It also advised financial-services company Equitable on its proposed tie-up with Corebridge Financial, which provides retirement solutions and insurance products, to form a US$22 billion insurer.
Goldman’s fees from investment banking rose to US$2.84 billion in the first quarter, a 48 per cent jump from the year-ago period.
Shares of the Wall Street giant have risen over 3 per cent so far in 2026, after a more than 53 per cent jump in 2025.
Big IPOs awaited
The initial public offering (IPO) market has been hit by renewed uncertainty, fuelled by geopolitical tensions, which has hurt risk appetite in equities.
Some companies, however, especially those in industrials and defence, have pressed ahead with their listing plans.
Goldman has secured a spot as one of the lead banks managing SpaceX’s blockbuster IPO expected in June, a Reuters report said.
The Elon Musk-led company could raise US$75 billion at a valuation of US$1.8 trillion.
The listing is expected to set the stage for a flurry of bumper offerings in 2026, including the potential IPOs of OpenAI and Anthropic.
Goldman was among the joint book-running managers in Japanese financial-services provider PayPay’s US$880 million US IPO, which valued the SoftBank-backed company at US$10.7 billion.
Asset management business sturdy
Goldman’s revenue from assets and wealth management rose 10 per cent to US$4.08 billion.
The bank has prioritised the business to generate steadier income, reducing its reliance on more volatile trading and investment banking revenues.
The company’s private credit fund, housed under the division, defied an industry-wide spike in redemptions last week, when investors sought to repurchase just under 5 per cent of shares in the first quarter – redemptions that did not breach its cap.
Fears that AI could erode software companies’ earnings and weaken their ability to service debt have rattled the multitrillion-dollar private credit industry, prompting investors to seek liquidity with a rush of withdrawals.
Goldman completed its acquisition of active exchange-traded fund (ETF) provider Innovator Capital Management earlier in April, lifting its total ETF assets under supervision to US$90 billion. REUTERS
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