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Goldman Sachs’ Q3 2025 earnings signal a clear turning point: dealmaking, long dormant under elevated interest rates and economic uncertainty, is now powering a broad-based rebound across its investment banking and markets divisions. The firm’s reported $2.66B in investment banking fees—42% above Q3 2024—reflects a strong surge in advisory business (up ~60%), as well as meaningful increases in debt underwriting (30%) and equity underwriting (21%) fees. ([proactiveinvestors.com](https://www.proactiveinvestors.com/companies/news/1080305/goldman-sachs-beats-q3-estimates-on-investment-banking-wealth-management-performance-1080305.html?region=ca&utmsource=openai))
The trading business also showed resilience: Gloomy predictions for FICC appear overly cautious, as that segment saw a 17% increase year-on-year. Equities trading was up 7%, though it underperformed some analysts’ expectations. Meanwhile, asset & wealth management delivered a steadier, fee-based foundation, with revenues up 17% and assets under supervision at record levels (~$3.45T), contributing to a smoother earnings base. ([investing.com](https://www.investing.com/news/economy-news/goldman-sachs-profit-jumps-as-bankers-cash-in-on-big-deals-4285692?utmsource=openai))
However, this upside comes with noteworthy caveats. Operating expenses rose ~14% amid regulatory, technology, and compensation pressures. Provision for credit losses declined slightly but remains sizeable ($339M), indicating continued risk, especially in consumer credit exposures. The firm is also signaling cost rationalization via staff cuts and AI-driven productivity programs (“OneGS 3.0”) that aim to offset rising costs. ([investing.com](https://www.investing.com/news/economy-news/goldman-sachs-profit-jumps-as-bankers-cash-in-on-big-deals-4285692?utmsource=openai))
Strategically, Goldman appears to be reinforcing its leadership in bulge-bracket dealmaking. Its advisory mandate on major transactions—such as Electronic Arts’ $55B take-private deal—and a backlog at its highest in three years suggest strong deal pipeline. ([investing.com](https://www.investing.com/news/economy-news/goldman-sachs-profit-jumps-as-bankers-cash-in-on-big-deals-4285692?utmsource=openai)) Yet sustaining this volume through 2026 will depend on macro factors: interest rate trajectories, regulatory reforms (particularly leverage and capital rules), credit conditions, and geopolitical risks. ([investing.com](https://www.investing.com/news/economy-news/goldman-sachs-profit-jumps-as-bankers-cash-in-on-big-deals-4285692?utmsource=openai))
From a shareholder perspective, the return on equity (14.2%) and earnings per share (EPS of $12.25) provide compelling upside. The market has responded with a ~37% YTD rise in Goldman’s stock. Still, the share price had early‐day pull-backs post-earnings, reflecting concern over margin pressures, trading shortfalls relative to expectations, and overhangs in regulatory capital metrics. ([investing.com](https://www.investing.com/news/economy-news/goldman-sachs-profit-jumps-as-bankers-cash-in-on-big-deals-4285692?utmsource=openai))
In sum, Goldman Sachs is riding the resurgence of the capital markets cycle, with dealmaking and trading driving outsized performance, asset & wealth management offering balance, and strategic investments (AI, acquisitions) positioning it for further gains. The open questions focus on sustainability under potential external shocks and managing operating leverage in uncertain regulatory and economic climates.