dChan - Q Origins Project Archive

Goldman Sachs posts its worst earnings miss in a decade - with profits plunging 66% from a year earlier to $1.33B - as experts warn of MORE layoffs after firm cut 3,200 jobs

Goldman Sachs recorded a larger-than-expected 69% drop in profit for the fourth quarter, taking a hit on a substantial decline in deal making revenue and a higher provision for loan losses. Shares fell nearly 7%.. (And Goldman Sachs has the dubious distinction of having the least amount of assets backing the most derivatives-cap#1 and they actually had moar in 2008 but since they din't have a commercial baking license (Marcus) they were not required to submit that to the O.C.C.)

Last week, Goldman Sachs cut 3,200 jobs, dismissing workers in the company's New York, London and Hong Kong offices. 'Widely expected to be awful, Goldman Sachs' Q4 results were even more miserable than anticipated,' said Octavio Marenzi, CEO of consultancy Opimas. 'The real problem lies in the fact that operating expenses shot up 11 percent, while revenues tumbled. This strongly suggests more cost-cutting and layoffs are going to come,' he added.The results marked Goldman's biggest miss of Wall Street expectations since 2011, according to Refinitiv, and its shares dropped more than 5 percent in morning trading. Faced with declining revenue from deal-making and asset management, CEO David Solomon has been forced to look for ways to cut costs, and recently began slashing a workforce that ballooned following the pandemic. Goldman and other Wall Street banks are making deep cuts to their workforce and streamlining their operations as dealmaking activity, their major source of revenue, stalls on worries over a weakening global economy and rising interest rates. The latest results showed Goldman's investment banking fees fell 48 percent last quarter, while revenue from its asset and wealth management unit dropped 27 percent due to lower revenue from equity and debt investments.

It also reported a pre-tax loss of $778 million in its platform solutions unit, which houses transaction banking, credit card and financial technology businesses, including Apple Card and fintech lender GreenSky. Full-year net loss for the platform solutions business was $1.67 billion, the bank said Goldman is planning to stop making unsecured consumer loans, a source familiar with the move told Reuters last month, in another sign it was moving away from its consumer business, including the troubled online bank Marcus.

Goldman's trading business was a rare bright spot as it benefited from heightened market volatility, spurred by the Federal Reserve's tightening monetary policy. Fixed income, currency and commodities trading revenue was up 44 percent, while revenue from equities trading fell 5 percent. Meanwhile, total operating expenses at Goldman rose 11 percent to $8.1 billion in the quarter, in a sign of the soaring costs that Solomon seeks to rein in with layoffs. In the layoffs that began last week, many Goldman employees were given little notice, and were cut loose without even receiving bonuses for their work in 2022, the Financial Times reported.

https://www.dailymail.co.uk/news/article-11644923/Goldman-Sachs-posts-worst-earnings-miss-decade-profits-plunging-66.html