A month has gone by since the last earnings report for Goldman Sachs (GS). Shares have added about 9.3% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Goldman due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
Goldman Q3 Earnings Beat Estimates on Solid IB Fees
Goldman’s third-quarter 2025 adjusted earnings per share of $12.25 surpassed the Zacks Consensus Estimate of $11.11 per share. This compares favorably with $8.40 in the year-ago quarter.
The volatile market lifted Goldman's net revenues in Equities by 7% year over year to $3.7 billion. Fixed income, currency and commodities trading revenues rose 17% year over year to $3.5 billion. A solid resurgence in deal-making activity led investment banking fees to jump 42% year over year to $2.7 billion in the quarter. Advisory fees saw a remarkable 60% year-over-year increase in the third quarter.
Goldman’s overall results benefited from solid revenue growth in the Global Banking & Markets and Asset & Wealth Management divisions. Yet, increased expenses were concerning.
Net earnings (GAAP basis) of $4.1 billion increased 37% from the prior-year quarter.
Revenues & Expenses Increase, Provisions Decline
Net revenues rose 20% to $15.2 billion for the quarter from the year-ago quarter. Also, the top line surpassed the Zacks Consensus Estimate by 7.4%.
Total operating expenses increased 14% year over year to $9.5 billion.
Provision for credit losses was $339 million, down 15% from the prior-year quarter.
Quarterly Segmental Performance Solid
The Asset & Wealth Management division generated revenues of $4.4 billion in the reported quarter, up 17% year over year. The increase reflects higher Management and other fees and significantly higher net revenues in Private banking and lending.
Firmwide assets under supervision were $3.5 trillion, up 11.2% from the prior-year quarter.
The Global Banking & Markets division recorded revenues of $10.1 billion, which increased 18% year over year. The improvement was driven by a rise in net revenues in Equities (including an increase in net revenues in financing), and strong performances in Fixed income, currency and commodities.
The Platform Solutions division’s revenues were $670 million, surging 71% year over year.
Capital Ratio Declines
As of Sept. 30, 2025, the standardized Common Equity Tier 1 capital ratio was 14.4%, down from 15.5% as of Sept. 30, 2024.
The company’s supplementary leverage ratio was 5.2%, down from 5.5% in the year-ago quarter.
Capital Distribution Update
In the reported quarter, the company returned $3.25 billion in capital to common shareholders. This included $2 billion in share repurchases and common stock dividends of $1.3 billion.
2025 Outlook
The company expects the tax rate to be nearly 22%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in fresh estimates.
VGM Scores
Currently, Goldman has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Goldman has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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The Goldman Sachs Group, Inc. (GS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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