Goldman Sachs 4Q Earnings Blows Past Expectations
Last update: 1/21/2010 8:25:44 AM
Goldman Sachs Group Inc.'s (GS) fourth-quarter profit well outstripped analysts' earnings expectations. Shares were up 1% premarket at $169.72. The stock doubled in 2009 but is been down slightly for the year to date. Fixed-income trading slowed after extraordinary profits in the past three quarters. Revenue from fixed income, currency and commodities was $3.97 billion, down from the $5.99 billion last quarter. But investment banking revenue moved higher, after falling almost a third in the third quarter. It rose 82% from the previous quarter to $1.64 billion. Revenue from principal investments, those made with the firm's own capital, fell from the previous period. The investment bank's impressive results in 2009 propelled it further ahead of rivals, many of which have struggled to overcome the credit crisis. Goldman has been able to take on more risk and grab market share while competitors were licking their wounds. But it has faced a populist backlash over employee compensation, facing complaints the company's profits are partly the result of government programs to prop up the industry. Chairman and Chief Executive Lloyd C. Blankfein said its strong results, "as well as recognition of the broader environment, resulted in our lowest ever compensation to net revenues ratio." He went on to say that "despite significant economic headwinds, we are seeing signs of growth." Goldman posted a profit of $4.95 billion, or $8.20 a share. Revenue was $9.62 billion. Analysts surveyed by Thomson Reuters predicted $5.20 a share and revenue of $9.65 billion. In the year-earlier period Goldman had a loss of $2.29 billion, or $4.97 a share, on negative revenue of $1.58 billion. The prior-year period ended on Nov. 28, before the company shifted to a different reporting calendar. -By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; joan.solsman@dowjones.com (END) Dow Jones NewswiresJanuary 21, 2010 08:25 ET (13:25
