Goldman Sachs posts Q2 earnings blowout, powered by investment banking

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Goldman Sachs (GS) reported second-quarter earnings results on Tuesday that far exceeded Wall Street's expectations, driven by strength in investment banking.

Here were the key figures versus expectations: 

Adjusted earnings per share (EPS): $15.02 per share vs. $10.15 estimate

Revenue: $15.39 billion vs. $12.43 billion estimate

Goldman's investment banking business posted its second-best quarter ever with $3.61 billion, following a record first quarter. Revenue from investment banking accounted for 24% of total revenues in the quarter. Goldman noted that its backlog in investment banking transactions “increased significantly compared with the end of 2020, ending the quarter at a record level.”

Citing “continued progress on our strategic priorities,” CEO David Solomon said that “while the economic recovery is underway, our clients and communities still face challenges in overcoming the pandemic.”

The banking giant once again topped the industry's league tables for mergers, stock floatations and initial public offerings (IPOs), which have been on a tear in a market perched at record highs.

However, global markets tumbled 32% from a year ago to $4.90 billion, with revenue from fixed income, currency, and commodities (FICC) dropping 45% from a year ago to $2.32 billion, while revenue from equities declined 12% to $2.58 billion compared to the same quarter of 2020. 

Elsewhere, asset management revenues more than doubled from a year ago to $5.13 billion, driven by “significantly higher” net revenues in equity investments. Revenues from asset management accounted for 33% of the total revenues in the quarter. 

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Revenues in the consumer and wealth management business rose 28% from a year ago to $1.75 billion but were flat from the prior quarter. 

Shares of Goldman were last trading down 0.53%, or down $2, near $378.50.

Julia La Roche is a correspondent for Yahoo Finance. Follow her on Twitter.

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