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Goldman Sachs Group Inc. on Tuesday said its fourth-quarter profit fell 13%, missing Wall Street estimates, in a choppy quarter for the Wall Street firm.
While the bank’s latest results included plenty of bright spots, Goldman
GS,
said revenue at its global markets and asset management units shrank from year-ago levels.
Shares of Goldman Sachs fell 3.5% in premarket trades. As of Friday’s close, Goldman Sachs shares are down 0.4% in 2022 and up 26.6% in the past 12 months, while the Dow Jones Industrial Average
DJIA,
has advanced 16.5% over the past year.
The bank ran into some of the same headwinds as JPMorgan Chase & Co.
JPM,
and Jefferies Co.
JEF,
as the impact of the omicron variant of the coronavirus that causes COVID-19 on the economy sent Treasury yields sharply lower during the quarter.
See: Wells Fargo outshines JPMorgan as big banks kick off the fourth-quarter earnings season
Goldman’s fourth-quarter net earnings of $3.81 billion, or $10.81 a share, fell short of the Wall Street estimate of $11.77 a share in a FactSet survey of analysts. In the year-ago quarter, Goldman reported earnings of $4.36 billion or $12.08 a share.
Total revenue increased 8% to $12.64 billion, ahead of the consensus analyst estimate of $12.04 billion.
Broken out, the firm’s investment banking revenue increased to $3.6 billion, ahead of the FactSet target of $3.24 billion and above the year-ago tally of $2.72 billion.
Net revenue in global markets fell 7% to $3.99 billion. The figure included an 11% drop in equities trading revenue to $2.12 billion.
Asset management revenue dropped 10% to $2.89 billion amid lower revenue in equity investments and lending and debt investments, offset by a boost in incentive fees.
Revenue at consumer and wealth management climbed 19% to $1.97 billion.
Provision for credit losses rose to $344 million from $293 million.
Operating expenses rose 23% to $7.27 billion as the bank paid out higher compensation and benefits expenses, as well as increases in technology expenses.
Head count rose to 43,900 from 43,000 as of Sept. 30.
For full-year 2021 results, Goldman said it set records in net revenue ($59.34 billion), net earnings ($21.64 billion) and record diluted earnings per share of $59.45. Its return on average common shareholder equity was 23%, the highest since 2007.
Also Read: JPMorgan, Goldman profit updates may shape bank stock rally
