Goldman Sachs Beats Profit, Revenue Forecasts

The company cut workers, but its compensation costs increased

By Christopher Freeburn, InvestorPlace Writer

Goldman Sachs (NYSE:GS) said on Tuesday that it earned $1.51 billion during the third quarter, compared to a loss in the same period last year. EPS came in at $2.85, topping Wall Street, which anticipated earnings of $2.19 a share, the Associated Press noted.

The bank posted quarterly net revenue of $8.4 billion, more than twice the $3.6 billion recorded last year, and easily exceeding analysts’ estimate of $7.2 billion.

Goldman Sachs also announced that its quarterly dividend would increase from 46 cents a share, to 50 cents a share.

Shares of Goldman Sachs dipped fractionally in Tuesday morning trading.

During the quarter, Goldman Sachs reduced its workforce by 1,600. But employees who remained with the firm saw more pay. The bank noted that costs related to compensation increased 10%.

Goldman Sachs indicated that revenue from stock and bond underwriting and mortgage products surged, while fees from stock trading fell and advisory fees for mergers and acquisitions were also lower.

Last month, the bank announced that CFO David Viniar had resigned and would be succeeded by Harvey Schwartz in January. Viniar would remain with Goldman Sachs and was expected to join its board of directors.

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