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Goldman Sachs Profit Reveals Rebound (Update 1)

  • Goldman Sachs reports first-quarter earnings per share of $3.92
  • Revenue increased 64% from the previous quarter, to $9.95 billion
  • Analysts were expecting EPS of $3.55 on revenue of $9.5 billion

NEW YORK ( TheStreet)-- Goldman Sachs (GS - Get Report) earned $2.11 billion, or $3.92 per share in the first quarter, while raising its quarterly dividend to 46 cents per share as its business mix started to pay off.

Net income came in at $2.07 billion, more than double the year-ago quarter. Revenue came in at $9.5 billion, slightly above estimates of $9.45 billion. Goldman increased its quarterly dividend to $0.46 per share.

Goldman Sachs Chairman and CEO Lloyd Blankfein

"Because client activity remains relatively low in certain areas, especially in parts of investment banking, we believe that our mix of businesses gives the firm significant room for revenue growth as economic and market conditions continue to improve," said Chairman and CEO Lloyd Blankfein.

Goldman's investment banking revenues were $1.15 billion, 9% lower than the year ago quarter and 35% higher than the fourth quarter of 2011.

As had been Goldman's fixed income currencies and commodities client execution business contributed more revenues than any other unit. Still, its $3.46 billion in revenues was shy of some estimates. Sandler O'Neill analyst Jeff Harte, for example, had been looking for Goldman to post revenues of $3.885 billion in fixed income, currencies and commodities.

Goldman's return on equity, a closely-watched measure of profitability, was 12.2% for the first quarter. While that is still below the 20% level it reached before the 2008 crisis, it is far better than the roughly 2% low it saw at one point in 2011.

Goldman shares were slightly lower in premarket trading Wednesday.

-- Written by Dan Freed in New York.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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