Goldman Sachs announced quarterly earnings that fell short of expectations on Thursday, blaming “renewed concerns” about global growth for the shortfall.
Revenues fell to $6.86bn from $8.39bn a year ago. The bank had been expected to announce $7.13bn in revenue, according to consensus estimates from Thomson Reuters.
Goldman’s third-quarter net income fell to $1.43bn, or $2.90 a share, from $2.24bn, or $4.57 a share, a year earlier.
“We experienced lower levels of activity and declining asset prices during the quarter, reflecting renewed concerns about global economic growth,” said Lloyd Blankfein, chairman and chief executive officer. “We continue to see strong levels of activity in investment banking and growth in investment management, and looking ahead, are encouraged by the competitive positioning of our global client franchise.”
The bank set aside $2.35bn for compensation and benefits for the third quarter of 2015, 16% lower than the third quarter of 2014.
Fixed income, currencies and commodities trading revenue fell 33% to $1.46bn for the quarter, while equities trading revenue increased 9% to $1.75bn.
Goldman is the latest US giant to announce disappointing results in this earnings season. Yesterday Walmart, the world’s largest retailer, also released results that fell short of expectations. It blamed rising wage costs and online competition for the shortfall.
Goldman’s results came as Citigroup too released its latest results. The bank also reported a slowdown in trading but profits jumped 50% to $4.29bn compared to the same quarter last year as its legal bills dropped sharply. Legal and associated costs for the quarter were $376m, down from $1.55bn a year ago, when the bank was preparing for an eventual $5.7bn fine for the manipulation of foreign-exchange rates.
In September, Blankfein announced he was suffering from a “highly curable” form of lymphoma. On a call with the bank’s managing directors Blankfein said he would continue to come into the office in the two week breaks between treatment, the Wall Street Journal reported. He said both he and the bank had had better quarters.
