Goldman Sachs Profit Rises on Jump in Dealmaking and Lending

Goldman Sachs reported a stronger-than-expected profit in the fourth quarter and record annual revenue in the bank’s investment banking and markets division last year as companies struck more deals and borrowed at a record clip.

The Wall Street giant’s profit increased 12% to $4.62 billion in the quarter. That amounted to $14.01 a share.

Revenue fell 3% to $13.45 billion, in part because of a one-time reduction related to the bank’s recent agreement to unload its Apple credit-card program to JPMorgan Chase. The transaction also boosted Goldman’s fourth-quarter earnings by 46 cents a share.

Morgan Stanley, meanwhile, reported better-than-expected profit and revenue in the fourth quarter and a 47% jump in investment banking revenue. Its wealth-management revenue, which accounts for roughly half of its revenue, rose 13%.

Despite the strong performance, Morgan Stanley Chief Executive Ted Pick urged caution on a call with analysts, pointing to macroeconomic and geopolitical factors and saying, “This is not the time to overreach.”

Goldman said Thursday it was boosting its quarterly dividend by 50 cents, bringing it to $4.50. It also set new targets for its asset and wealth-management business, including returns in the high teens rather than midteens.

Wall Street’s engines continue to gain momentum thanks to a booming stock market and growing appetite in corporate boardrooms and executive suites to pursue mergers and public offerings.

Banks are bracing for what they hope could be the biggest year for IPOs ever, with rocket maker SpaceX, artificial-intelligence company Anthropic and others eyeing listings.

The pickup in mergers and acquisitions is also fueling a rise in lending that helps deals happen. Big banks continue to increase lending to facilitate companies’ AI investments and other infrastructure projects. Industrywide, debt-underwriting activity in 2025 surpassed the sector’s 2020 high, according to Dealogic.

At Morgan Stanley, revenue from fixed-income underwriting surged 93% in the fourth quarter, leading the segments that contributed to the firm’s jump in investment-banking fees.

At Goldman, investment-banking revenue rose 25% in the fourth quarter from a year ago, driven by advisory fees and debt underwriting.

Industrywide dealmaking numbers are inching back to their all-time records. Globally, merger and acquisition activity increased 44% in 2025 from a year earlier. Some of the uptick has been driven by private-equity firms returning to dealmaking.

Trading revenue at Goldman was up 19% in the fourth quarter from a year ago and continues to be propelled by the firm’s lending to hedge funds and other institutional clients. The firm reported record revenue from equities financing, which involves lending to hedge funds, for the fourth quarter and the full year.

Goldman also posted record revenues from what it calls FICC financing, which involves a range of lending such as capital call loans made to investment firms and warehouse financing to mortgage lenders and others that use those funds to lend to consumers.

Write to AnnaMaria Andriotis at [email protected]