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Goldman Beats Modest Estimates As Prop Trading Revenue Plunges; Avg Employee Comp Slides 16% From Year Ago To $343,003
On the surface, Goldman's results, which unlike JPM and Citi do not break out the contribution of DVA, aka the top and bottom line contribution from Goldman's CDS blowing out in Q2, were good because they beat expectations of $6.26 billion in revenue and $1.18 in EPS, printing at $6.63 billion and $1.78/share. Of course, going back 3 weeks and the bottom line estimate would have missed then consensus EPS, but who cares: after tall the firm guided down and all the algos know is that GS beat. The problems arise when one spreads the various top line segments which portend nothing new: Client Flow, a proxy for general credit trading, dropped from $3.5 billion to $2.2 billion in Q2, but better than Q2 2012 when it was just $1.6 billion. However, client flow in equities was an abysmal $1.7 billion, down from $2.3 billion in Q2 and $1.9 billion last year as increasingly less people opt to use Goldman's REDi platform or its equity sales team. But most troubling was the epic collapse in the firm's Investing and Lending group, aka its highest margin, Prop Trading operation, which in the aftermath of the JPM fiasco mysteriously saw its revenue collapse from $1.9 billion to a mere $203 million, down from $1 billion a year earlier, and only the second lowest number in the past 3 years. Did the JPM CIO CDS repricing scandal force all banks to suddenly reevaluate their CDS books and mark mid-market? We don't know, but there were no reason why Goldman's prop traders should have generated only $200 million in a quarter in which the bulk of the heat was focused on JPM and others. And finally, in terms of employee retention, Goldman employees can not be happy: in Q2 average comp to the firm's 32,300 total staff also declined to a multi-year low of $343,003, down from $350,864 last quarter, and down 16% from $408,958 a year earlier.
Goldman revenue breakdown by group:
Average comp:
And Q2 EPS estimates over time, courtesy of John Lohman:
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NO QE3
No need. Hints and innuendo at 10AM are all the market wants before it takes off like a JATO rocket.
Goldman Beats Modest EstimatesNot hard when you change the estimates at 15 minute intervals coupled with the JATO rockets.
Hey....we're smart.....yeah whatever.
No I didn't mean to bold my comment but the HTML fix isn't working....so deal with it.
But, CNBS.com said GS BLOWS past estimates. They would not mislead would they?
http://www.cnbc.com/id/48175621
Let me give you my simple analysis. The fuckers are finally running out of other peoples money to steal.
Wow.....that seems serious.
Looks like a crash landing into the lower expectations the middle class are supposed to be enjoying.
One thing about it, if the tax break does turn out to be people with 250,ooo incomes or less, these boys and girls will be just fine with the idea in another 84,ooo in salary reductions. Notice the zeros are all a bit smaller than normal, thanks to the FED.
Which is why they are starting a "Private Bank" within Goldman. Apparently to lend to wealthy clients and corporations.....HOW DO WE DO IT: "WOLUME".
And finally, in terms of employee retention, Goldman employees can not be happy: in Q2 average comp to the firm's 32,300 total staff also declined to a multi-year low of $343,003, down from $350,864 last quarter, and down 16% from $408,958 a year earlier.
dam, even more traffic in the dollar store now. i certainly hope they'll be able to scrape by.
Oh, the horror, the shame! I would just jump off the roof of Goldman Sachs Tower if I had to endure that kind of embarrassment.
Save your honor, and just jump, motherf***ers!
No Doubt, they would land on a big pile of taxpayer cash and break the fall.
I have a feeling that they are emptying the warehouse of treasure and replacing the goods with empty boxes waiting for Uncle Sam to come along and buy the whole schbank...ata loss of course.
FUCK YOU GS!
And, the avg pay was $343K? Fuck that.
Hmmm...that last bar looks a lot shorter than the one to its left. I should probably not think about that too much.
Remember GS is involved in CDS manipulation - ICE MARKET
like that EPS est graph looking for 0. then -. master of the universe LOL
That last chart sure looks like there is a lot more downside.
that is a chart?
i thought it was a sketch of machu picchu.
http://www.google.com/imgres?imgurl=http://peruahora.files.wordpress.com...
the only thing the market is waiting for is does it go higher in spite of the "long goodbye of The Goldman Sachs."
Isn't the prop trade division really just the insider trading division?
Only #343k!! I think we should have a charitable drive for the workers there.
Our Defining Moment
http://shutupnsing.wordpress.com/2012/07/17/precious-time/
Only $343,003?
Austerity for Hookers and Coke dealers.
Austerity for Hookers and Coke dealers.
Pardon me sir....but it we do that the economy is going to go straight to hell.
It used to be $600,000 -then they squeezed all the janitors and clerical staff. If you are spending a good portion of your time doing God's work -you know it will cut into the profits.
Everybody beats estimates. Another Festivus miracle!