Goldman Sachs Reports 29 Percent Profit Growth on Trading Gains

Goldman Sachs reported a 29% increase in third quarter profits on Tuesday as its Wall Street trading and investment banking operations delivered stronger-than-expected results in a challenging market environment, according to the company.

The bank posted $5.29 billion in net earnings, or $17.01 per share, compared with analyst expectations of $13.50 per share. Total net revenue reached $18.7 billion, above the $16.4 billion forecast by analysts.

Goldman Sachs CEO David Solomon described the period as "a complicated operating environment" in the statement accompanying the earnings release.

"A complicated operating environment" was used by David Solomon, chief executive officer of Goldman Sachs, to characterize the third quarter backdrop.

Solomon said the bank remained focused on serving clients despite global uncertainty. The company reported that equities and fixed income trading revenue totaled $9.9 billion, supported by a 96% increase in equities financing revenue.

"Notwithstanding the current complexity and uncertainty in the world, we remain very well positioned to continue to deliver for our clients," said David Solomon, chief executive officer of Goldman Sachs.

The trading results exceeded the $8.8 billion analyst projection but remained below the record $12 billion recorded in the previous quarter. Revenue from the fixed income, currencies and commodities group declined slightly from a year earlier.

Goldman Sachs also reported stronger investment banking performance, with fees rising 21% to $3.22 billion. Revenue from its mergers and acquisitions advisory unit and equity underwriting business increased, while advisory revenue reached a record $1.65 billion.

The earnings report included $368 million in provisions for credit losses, mainly related to wholesale loan impairments, and charitable contributions that reduced earnings by about $1 per share.

According to Goldman Sachs, its Platform Solutions business revenue fell 72% as the company recorded markdowns tied to its Apple Card loan portfolio. Goldman Sachs is in the process of transferring that portfolio to JPMorgan Chase.