US bank earnings open with a JPMorgan miss and stronger Goldman results

Major US banks opened third-quarter earnings season October 13 with mixed results. JPMorgan Chase missed profit expectations, while Goldman Sachs reported stronger earnings. Citigroup and Wells Fargo also released figures, covering trading, lending and dealmaking. ^[4]

JPMorgan’s profit and the estimate

JPMorgan’s filing reports net income of $15.3 billion, or $5.57 a share. Excluding a significant item, it reports $15.8 billion and $5.75 a share. The item was $658 million in net investment-securities losses, reducing earnings per share by 18 cents. The filing separates that adjustment from its reported result. ^[1]

Reuters says the reported $5.57 fell below the $5.85 average estimate compiled by LSEG, the bank’s first quarterly profit miss since the fourth quarter of 2023. Investment-banking fees rose 14% from a year earlier but fell 8% from the previous quarter. Markets revenue increased 15% year on year, with equities up 49% and fixed-income trading down 4%. ^[3]

Goldman’s equities business stands out

Goldman’s earnings release reports $18.68 billion in net revenue and $5.29 billion in net earnings, with diluted earnings of $17.01 a share. Revenue rose 23% from a year earlier but fell 8% from the second quarter. Its equities business generated $6.44 billion, up 72% year on year. ^[2]

The company attributes that equities growth to financing and intermediation, including prime and portfolio financing and derivatives. Its asset and wealth management business produced $5.05 billion in revenue, up 14% from a year earlier. The release says higher management and incentive fees were partly offset by lower investment and private-banking-and-lending revenue. ^[2]

Other banks and the next reports

The Wall Street Journal reports that Citigroup’s profit rose 40% to $5.2 billion and revenue reached $23.85 billion, its strongest third-quarter revenue in a decade. Wells Fargo’s profit increased 6% to $5.95 billion, though revenue of $21.87 billion fell short of estimates. Those outcomes underline the differences within the sector. ^[4]

Reuters’ October 8 preview identified deposit costs, lending growth, credit quality and deal pipelines as key investor questions as Treasury yields rose. Bank of America and Morgan Stanley are scheduled to report October 14. Their releases will add to the evidence on whether capital-markets activity and traditional lending can maintain growth as funding conditions change. ^[5]