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Lower Q1 Revenue Drags Goldman Sachs Stock Down


Apr. 16 2019, Published 3:02 p.m. ET

Key takeaways from Q1

Goldman Sachs (GS) posted mixed first-quarter results yesterday, with its revenue missing analysts’ estimate. It fell 13% YoY (year-over-year) due to lower revenue from equity underwriting and interest rate products, and lower net gains from investments in private equities.

Citigroup’s (C) and Wells Fargo’s (WFC) revenue also fell in the first quarter. Citigroup’s fell 2% YoY and missed analysts’ estimate, reflecting lower equity revenue. Meanwhile, Wells Fargo’s revenue beat analysts’ sales estimate but fell due to net interest income decreasing because of lower loans and deposits. Bank of America’s (BAC) revenue also missed analysts’ estimate, due to lower non-interest income.

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On the contrary, higher interest, loans, deposits, and non-interest income boosted JPMorgan Chase’s (JPM) revenue by 5% in the first quarter, helping it beat expectations.

Goldman Sachs’ earnings fell 17.8% YoY but beat analysts’ estimate. Lower revenue and increased provision for credit losses weighed on its bottom line. 

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Q1 financials

In the first quarter, Goldman Sachs’s revenue fell 13% YoY to $8.81 billion, missing analysts’ estimate of $8.99 billion. Its revenue was dragged down by lower Institutional Client Services and Investing & Lending revenue. Goldman Sachs’ provision for credit losses increased YoY to $224 million from $44 million, while its EPS fell 17% YoY to $5.71 due to lower revenue. However, its EPS beat analysts’ estimate of $4.89. Goldman Sachs stock fell ~4% to close at $199.91 yesterday.


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