Goldman Sachs just pulled off a record-breaking second quarter in 2025, with its stock trading unit raking in the highest revenue Wall Street has ever seen.
The surge came amid wild market swings triggered by the Trump administration’s latest trade moves.
The investment banks’ historic quarter underscores the bank’s agility and dominance in capitalizing on volatile markets.
However, management seems to be mindful as the environment remains fraught with risks stemming from ongoing trade and economic uncertainty.
Record equity trading and profit beat
Equity-trading revenue soared to $4.3 billion in Q2, outpacing analyst expectations by roughly $600 million and exceeding Goldman’s record from the previous quarter by $100 million.
This contributed significantly to a 22% jump in quarterly profit.
The surge was fuelled by turbulence in global markets as investors reacted to new tariffs, prompting increased trading activity and portfolio rebalancing.
While the entire industry saw a boost, Goldman’s equity-trading growth far outstripped peers, as Morgan Stanley and Bank of America experienced either declines or slower growth in their stock trading revenues during the same period.
Goldman’s standout trading results underscore its determination to expand its trading arm, even as it faces stiff competition from rivals like Morgan Stanley and others.
While market volatility proved to be a boon for its trading desks, it also made corporate clients more cautious, slowing activity in dealmaking and capital raising as uncertainty around trade policy lingered.
Goldman Sachs Q2: Broad-based revenue growth
Fixed Income, Currencies and Commodities (FICC) trading brought in $3.47 billion, a 9% rise year-on-year, with financing activities in both equities and FICC achieving record revenues.
Investment banking fees reached $2.19 billion, buoyed by a 71% gain in financial advisory revenue, primarily from mergers and acquisitions, while equity underwriting remained flat and debt underwriting slightly declined, reflecting a drop in leveraged finance deals.
Even with some deals slowed by trade policy uncertainty, a backlog of pent-up demand fueled a wave of acquisitions in Goldman’s advisory business.
Meanwhile, asset and wealth management, one of the firm’s key growth priorities, saw management fees climb 11% from a year ago.
Still, overall revenue in the division edged down slightly to $3.78 billion as market conditions remained choppy.
Goldman continued to tighten operational efficiency: it trimmed its workforce by 700, moving more roles to lower-cost locations such as Dallas, Warsaw, and Bengaluru.
This is part of a broader, multi-year cost-cutting initiative.
Thanks to strong trading gains and solid performance across key divisions, Goldman’s total net revenue jumped to $14.58 billion in the second quarter, up 15% from the same period last year.
Net earnings came in at $3.72 billion.
Shareholder returns and outlook
After sailing through the Federal Reserve’s stress tests, the firm also boosted its quarterly dividend by a hefty one-third, raising it to $4.00 per share.
Shareholders recently approved substantial retention bonuses for CEO David Solomon and President John Waldron, reflecting leadership stability and high performance.
CEO David Solomon emphasized ongoing emphasis on risk management, given that market developments “rarely unfold in a straight line,” and acknowledged the possibility of further economic and policy turbulence ahead.
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