Goldman Sachs CEO warns of softer fixed-income trading and rising costs

Goldman Sachs CEO David Solomon has signaled a mixed outlook for the firm’s third-quarter performance. While the equities division remains very strong, the fixed-income, currencies, and commodities (FICC) business is expected to be slightly softer compared to previous quarters.

Solomon also cautioned investors regarding rising costs. The bank is experiencing higher transaction expenses and has accelerated investments in technology, including artificial intelligence and cloud infrastructure. These factors are expected to increase non-compensation expenses by more than $500 million sequentially.

In contrast to the moderation in trading segments, Goldman’s asset and wealth management (AWM) division continues to show robust growth. The division is performing above its original targets, with management and other fees growing at an annual rate of 12% since 2021, and assets under supervision surpassing the $4 trillion mark.