Goldman Sachs Q4 Earnings Summary: Capital Markets Strength Drives Higher Returns and Strategic Momentum
Stronger Trading and Investment Banking Fuel Earnings Growth
Goldman Sachs Group delivered a strong fourth quarter, reflecting a broad-based rebound in capital markets activity, continued growth in more durable fee streams, and disciplined capital management. Earnings per share came in at $14.01, with ROE of 16% and ROTE of 17.1%, marking a solid finish to a year in which the firm significantly improved profitability and returns.
Revenue totaled $13.5 billion, supported by standout performance in Global Banking & Markets, particularly equities trading and financing, alongside steady growth in Asset & Wealth Management. Results were aided by a reserve release tied to the transition of the Apple Card portfolio, though underlying operating momentum was strong even excluding this item. Management emphasized that multi-year strategic actions - scaling capital-light businesses, simplifying the firm, and improving funding resilience - are now translating into more consistent earnings power.
Key Financial Highlights
EPS: $14.01 (Q4) | FY EPS: $51.32 (+27% YoY)
Revenue: $13.5B
ROE / ROTE: 16.0% / 17.1%
Global Banking & Markets Revenue (Q4): $10.4B (+22% YoY)
Investment Banking Fees: $2.6B (+25% YoY)
Equities Revenue: $4.3B (record; financing +42% YoY)
FICC Revenue: $3.1B (+12% YoY)
Asset & Wealth Management Revenue: $4.7B
Assets Under Supervision: $3.6T (record)
CET1 Ratio: 14.4%
Capital Returned (Q4): $4.2B
Quarterly Dividend: Raised 12.5% to $4.50
Capital Markets Reacceleration and Franchise Strength
Global Banking & Markets was the clear driver of upside, benefiting from improving client activity across investment banking, equities, and fixed income. Investment banking fees rose 25% year-over-year, with strength across advisory, debt underwriting, and equity issuance. Goldman maintained its #1 global M&A advisory position, supported by a backlog at its highest level in four years - signaling improving visibility into 2026 deal activity.
Equities was a standout, with record revenues driven by strong derivatives performance and continued growth in equities financing, reflecting higher client balances and increased leverage activity. Fixed Income, Currencies and Commodities (FICC) results were also solid, led by rates and commodities, while financing revenues reached new highs, underscoring the firm’s strategy to grow more durable, balance-sheet-efficient revenue streams.
Asset & Wealth Management Scale and Margin Expansion
Asset & Wealth Management continued to gain scale and improve profitability. Management and other fees reached a record $3.1 billion, driven by higher alternative assets, private banking activity, and sustained fee-based inflows. Total assets under supervision rose to $3.6 trillion, supported by $66 billion of long-term fee-based net inflows during the quarter.
The firm raised its medium-term profitability ambitions for the segment, targeting a 30% pre-tax margin and high-teen returns, supported by growth in alternatives, wealth management, and solutions. Fundraising momentum remained strong, with $115 billion raised in alternatives in 2025, reinforcing the firm’s positioning as a leading global alternatives manager.
Capital Management, Efficiency, and Outlook
Goldman continues to emphasize disciplined capital deployment, announcing a 50% year-over-year increase in its quarterly dividend and maintaining significant remaining buyback capacity. The firm’s funding profile has become more resilient, with deposits now accounting for roughly 40% of total funding, reducing reliance on wholesale markets.
Looking ahead, management struck an optimistic tone on 2026, citing rising M&A engagement, increasing sponsor activity, and improving capital markets conditions. At the same time, leadership acknowledged macro, policy, and geopolitical risks, emphasizing that risk discipline and balance sheet flexibility remain central to execution. Efficiency initiatives under the One Goldman Sachs 3.0 operating model are expected to support margins and returns as activity continues to normalize.
Here’s Our Take
Goldman Sachs’ Q4 results highlight a firm that is emerging from the post-pandemic reset with a stronger mix of businesses, improved returns, and greater earnings resilience. The rebound in capital markets - particularly equities trading and advisory - combined with growing, more durable revenue streams in financing and Asset & Wealth Management, is driving a meaningful step-up in profitability.
While results benefited from one-time items related to the Apple Card transition, underlying trends point to improving momentum heading into 2026. With investment banking pipelines rebuilding, sponsor activity poised to recover, and alternatives and wealth management continuing to scale, Goldman appears well positioned to benefit from both cyclical tailwinds and its long-term strategic repositioning. Valuation and macro sensitivity remain key considerations, but the firm’s strengthened franchise, capital flexibility, and execution discipline provide a solid foundation for navigating the next phase of the cycle.
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