• Goldman Sachs reported fourth-quarter earnings that missed earnings and revenue estimates on Tuesday.
  • Earnings per share were $3.32, below the $5.48 estimate, while revenue was $10.59 billion, versus the $10.83 billion estimate.
  • The bank has begun laying off more than 3,000 employees, joining other Wall Street firms in taking cost-cutting measures.

Goldman Sachs reported fourth-quarter earnings on Tuesday that missed analysts’ estimates, and the Wall Street giant saw declines in investment banking and asset management revenue.

Asset management revenue fell 27% to $3.56 billion, and investment banking fees plunged 48% to $1.87 billion.

Equity trading revenue increased 5% to $2.07 billion, while fixed income trading increased 44% to $2.69 billion. Consumer platform revenue soared 171% to $513 million, driven by higher credit card balances.

“In a challenging economic environment, we delivered double-digit returns for our shareholders in 2022. Our clear near-term focus is to reap the benefits of our strategic realignment that will strengthen our core businesses, scale our growth platforms and improve efficiencies,” he said. Executive Director David Solomon.

Shares of Goldman Sachs fell more than 2.3% in premarket trading on Tuesday.

Here are some key numbers:

  • Income: $10.59 billion vs. median forecast of $10.83 billion
  • Earnings per share: $3.32 vs. Average Forecast of $5.48

On Wall Street, the business of underwriting stocks and bonds, as well as deal advice, has dried up, dragging investment banking revenue down.

On Friday, rival Citigroup beat fourth-quarter forecasts, but investment banking revenue fell 58%. JPMorgan also beat earnings estimates, but chief executive Jamie Dimon warned of a darkening macroeconomic environment.

Meanwhile, Goldman Sachs, in particular, lost billions in its fledgling consumer banking experiment. On Friday, it said its newly formed consumer and technology unit suffered the equivalent of $3 billion in pre-tax losses since 2020.

Meanwhile, the company is set to lay off up to 3,200 employees, or around 6.5% of its workforce, with consumer banking teams set to be hit particularly hard.

“We just heard today was doomsday and we would start hearing cuts this morning,” a Goldman employee told Insider last week. “Every 10 minutes, I kept hearing that someone was being fired.