Goldman Sachs Posts Record Equities Revenue in Q1 Beat

Goldman Sachs delivers $17.23bn in Q1 revenue, driven by record equities and a surge in M&A advisory as its wealth management pivot gains traction.

Key Takeaways

• Q1 net revenues rose 14% year on year to $17.23bn, with diluted EPS of $17.55 and annualised return on equity of 19.8%, comfortably clearing consensus expectations.
• Equities hit a record $5.33bn on prime brokerage strength, while M&A advisory surged 89%, signalling early recovery in corporate dealmaking after a prolonged period of suppressed activity.
• Assets under supervision reached a record $3.65 trillion, with 33 consecutive quarters of positive long-term inflows, marking measurable progress in Goldman’s shift toward fee-based, recurring revenues.

A Quarter That Confirmed the Thesis

Goldman Sachs has spent the better part of five years convincing investors that it is more than a trading house. The first-quarter results, reported on April 13, offered the clearest evidence yet that the argument is holding. Net revenues of $17.23 billion, up 14 percent from the prior-year period and a striking 28 percent above the fourth quarter of 2025, reflected a franchise operating with both momentum and discipline. Net earnings reached $5.63 billion. Diluted earnings per share came in at $17.55, a 25 percent increase year on year. Annualised return on average common equity climbed to 19.8 percent.

The numbers cleared consensus estimates by a meaningful margin. Expectations ahead of the print had clustered around $16.7 billion to $17.0 billion in revenue and approximately $16.35 to $16.50 in earnings per share. Goldman exceeded both. Shares opened with modest gains as the market absorbed a report that left relatively little room for complaint.

What made the quarter instructive was not simply the scale of the beat, but its composition. Strength in equities financing and investment-banking advisory offset softness in fixed income. Fee-based revenues in asset and wealth management continued their steady expansion. The trading engine performed, but it was no longer the only engine running.

Equities and Advisory Drive the Top Line

Global Banking and Markets, which generated $12.74 billion in net revenues, accounted for roughly three-quarters of the group total and grew 19 percent year on year. Within it, the results were uneven in ways that matter.

Equities delivered a record $5.33 billion, up 27 percent from a year earlier. The primary driver was financing, where prime brokerage activity reflected sustained demand from hedge funds and private equity for leverage and structured exposure. Cash intermediation also advanced, though more modestly. For Goldman, prime brokerage has evolved into a structural growth engine rather than a cyclical one, and this quarter reinforced that characterisation.

Investment-banking fees jumped 48 percent to $2.84 billion, the single most consequential line in the report for those tracking the health of capital markets. Advisory revenues surged 89 percent, reflecting a genuine acceleration in completed mergers-and-acquisitions volumes. Equity underwriting rose 45 percent on convertible issuance activity, while debt underwriting edged 8 percent higher. The advisory rebound is early, and there are valid reasons for caution about extrapolating from a single quarter. But the direction is clear, and the magnitude is not trivial.

Fixed Income, Currency and Commodities told a different story. Revenues fell 10 percent to $4.01 billion, with weakness concentrated in rates, mortgages and credit intermediation. The soft patch was predictable given the interest-rate environment, and Goldman flagged subdued client activity across those product categories. The FICC decline did not derail the quarter, but it serves as a reminder that the fixed-income franchise remains sensitive to macro conditions in a way that equities, at present, is not.

Wealth Management Reaches an Inflection Point

Asset and Wealth Management produced $4.08 billion in net revenues, up 10 percent year on year. Management and other fees grew 14 percent to $3.08 billion, a figure that reflects scale as much as fee rate. Assets under supervision reached a record $3.65 trillion, up 15 percent year on year, with long-term AUS at $2.72 trillion. Net inflows into long-term fee-based products totalled $62 billion in the quarter, the 33rd consecutive period of positive flows.

That streak matters. Thirty-three quarters is not a run of fortune; it is a structural shift. Goldman has spent years building the distribution, product depth and client relationships required to compete credibly in asset and wealth management. The accumulation of assets is now large enough that management fees alone provide a meaningful base of recurring revenue, something the firm’s historical earnings profile conspicuously lacked.

Incentive fees rose 42 percent on strong investment performance, adding texture to the picture. Private banking and lending revenues fell 12 percent, reflecting narrower deposit spreads, a headwind the industry has navigated broadly. The completion of the Industry Ventures acquisition in the quarter, adding $5 billion in alternatives AUS, continued Goldman’s deliberate build-out of its alternatives franchise.

Capital Returns and Operating Discipline

The firm returned $6.38 billion to common shareholders in the quarter, comprising $5 billion in buybacks and $1.38 billion in dividends. Average global core liquid assets stood at $494 billion. Book value per share rose 1.0 percent to $361.19.

Operating expenses increased 14 percent to $10.43 billion, driven by higher transaction-related costs and compensation, the latter a natural consequence of strong performance across the advisory and equities businesses. The efficiency ratio held at 60.5 percent. Provisions for credit losses edged up to $315 million. The CET1 ratio declined modestly quarter on quarter as risk-weighted assets increased, a detail worth monitoring as the firm deploys capital into what management described as a broad set of franchise opportunities.

The one genuine drag in the quarter came from Platform Solutions, where revenues fell 33 percent to $411 million, primarily reflecting net markdowns on the Apple Card loan portfolio ahead of its transition to another issuer. The episode serves as a useful postscript to Goldman’s consumer finance chapter: the exit was managed, but not costless.

What the Quarter Signals for the Rest of 2026

Goldman enters the second quarter with record assets under supervision, a recovering advisory pipeline, and a prime brokerage business that has become genuinely differentiated. The macro backdrop remains complicated. Inflation is sticky in several major economies. Rate trajectories are contested. Geopolitical uncertainty has not abated. Against that landscape, Goldman’s diversified model provides more ballast than it did even two years ago.

The advisory recovery, if sustained, would have broader implications. A durable rebound in M&A volumes would benefit not just Goldman but the broader capital markets ecosystem, drawing in legal advisers, financing banks and strategic consultants. The early signals from Q1 are encouraging, though the durability of that trend will depend heavily on regulatory posture and corporate confidence in the months ahead.

For now, the first-quarter print offers a considered verdict on Goldman’s strategic direction. The franchise is performing. The pivot toward recurring, fee-based revenue is accumulating real evidence. And the core trading and advisory businesses, far from fading into the background, are delivering at the highest level. That combination is precisely what the long-term investment thesis requires.