Investment banking fees increased 26% year-over-year to $2.19 billion in Q2 2025, driven by strength in advisory services across the Americas and EMEA. Investment Management revenues grew 12% year-over-year to $2.84 billion, primarily due to higher management and other fees, reflecting increased average Assets Under Supervision (AUS) of $3.293 trillion in June 2025, up from $2.934 trillion in June 2024.

The firm raised $18 billion in third-party commitments in its alternatives business during Q2 2025, including $7 billion in corporate equity and $6 billion in credit. This brings total alternatives fundraising to $37 billion for the first half of 2025 and $360 billion since 2019, demonstrating strong client demand and strategic focus on this segment.

The Board approved a new share repurchase program of up to $40 billion and increased the quarterly common stock dividend from $3.00 to $4.00 per share. These capital allocation decisions signal management's confidence in the firm's future earnings and commitment to returning value to shareholders.

The firm's efficiency ratio improved to 63.4% in Q2 2025 from 67.0% in Q2 2024, and to 62.0% for the six months ended June 2025 from 63.8% in the prior year period. This indicates management's success in controlling expenses relative to revenue growth, enhancing operational leverage.

Management continued to narrow its focus on consumer-related activities by completing the sale of the GreenSky loan portfolio in 2024 and is transitioning the GM credit card program to another issuer by Q3 2025. These actions reflect a disciplined approach to optimize the business portfolio and reduce exposure in less core areas.

The firm recognized approximately $140 million in severance expense during the first half of 2025 due to a headcount reduction initiative. This led to a 2% sequential decrease in headcount from March 2025 to June 2025, demonstrating management's proactive steps to streamline operations and enhance cost efficiency.

The operating environment in Q2 2025 was characterized by continued market volatility, broad macroeconomic uncertainty, inflationary pressures, and ongoing geopolitical tensions. These factors pose potential negative impacts on asset prices, market-making activity levels, investment banking, and credit losses.

The Federal Reserve's proposed recalibration of the enhanced Supplementary Leverage Ratio (SLR) could reduce the firm's SLR, TLAC to leverage exposure, and external long-term debt to leverage exposure ratios by approximately 125 basis points. This regulatory change, if adopted as proposed, could increase capital requirements and impact capital planning.

The firm has estimated the upper end of the range of reasonably possible aggregate loss for certain legal matters to be approximately $1.7 billion in excess of aggregate reserves. This indicates a material potential financial exposure from ongoing judicial, regulatory, and arbitration proceedings.

Market making revenues increased 9% year-over-year to $4.73 billion in Q2 2025, reflecting higher net revenues from intermediation activities, particularly in equity products, currencies, and credit products. Investment banking advisory revenues showed strength in Americas and EMEA, indicating competitive gains in key regions and product areas.

The firm's ability to raise $18 billion in third-party commitments for its alternatives business in Q2 2025, contributing to $360 billion since 2019, underscores its strong competitive advantage in attracting and managing alternative assets. This positions the firm as a preferred partner for sophisticated investors.

Despite continued market volatility and macroeconomic uncertainty, the firm's overall net revenues increased 15% year-over-year in Q2 2025. This resilience, particularly in core trading and advisory activities, suggests a strong competitive position capable of navigating challenging market conditions.

The firm's efficiency ratio improved to 63.4% in Q2 2025 from 67.0% in Q2 2024, and to 62.0% for the six months ended June 2025 from 63.8% in the prior year period. This indicates that revenue growth outpaced expense growth, leading to improved operational leverage and effective management of the cost base.

Total operating expenses increased 8% year-over-year to $9.24 billion in Q2 2025, primarily due to higher compensation and benefits expenses (reflecting improved operating performance) and increased transaction-based expenses. While higher, these expenses are tied to business activity and performance.

The firm incurred approximately $140 million in severance expense during the first half of 2025 as part of a headcount reduction initiative. This resulted in a 2% sequential decrease in headcount from March 2025 to June 2025, demonstrating management's efforts to optimize its workforce and cost structure.

The firm actively monitors cybersecurity threats and risks, emphasizing phishing and cybersecurity training for employees and allocating additional resources for business continuity. This proactive approach, overseen by the Firmwide Technology Risk Committee, aims to safeguard systems and data against increasingly sophisticated attacks.

The firm acknowledges that new AI technologies may increase cybersecurity risks and has established a 'Firmwide Artificial Intelligence Risk and Controls Committee'. This committee reports to the Firmwide Technology Risk Committee, indicating a structured approach to managing risks and opportunities associated with AI adoption.

The firm continues to issue credit cards and raise deposits through its consumer banking digital platform, Marcus by Goldman Sachs, and through partnership arrangements like Apple Card. This highlights ongoing digital transformation efforts to serve clients and expand offerings in the consumer finance space.

The Board approved a share repurchase program of up to $40 billion and increased the quarterly common stock dividend from $3.00 to $4.00 per share. In Q2 2025, the firm returned $3.96 billion of capital to common shareholders, including $3.00 billion in repurchases and $957 million in dividends, demonstrating a strong commitment to shareholder value.

The firm raised $18 billion in third-party commitments for its alternatives business in Q2 2025, with significant allocations to corporate equity ($7 billion) and credit ($6 billion). This aligns with the firm's target to grow total credit alternative assets to $300 billion by the end of 2028, indicating a clear investment priority.

Total shareholders' equity increased to $124.10 billion as of June 2025 from $122.00 billion as of December 2024. This growth, driven by net earnings and preferred stock issuances, provides a stable capital base to support the firm's business activities and absorb potential losses.

The firm has investments totaling $3.47 billion as of June 2025 in qualified affordable housing and renewable energy projects through Variable Interest Entities (VIEs). Additionally, firmwide initiatives include investments related to the Community Reinvestment Act and corporate engagement programs like One Million Black Women.

The Board, through its Public Responsibilities Committee, oversees the firmwide sustainability strategy and climate-related risks, including approaches to scenario analysis and integration into existing risk management processes. This demonstrates a structured and high-level commitment to ESG governance.

The firm has continued to make significant enhancements to its climate risk management framework, integrating climate risk into broader risk management processes. This includes efforts to incorporate climate risk into credit evaluation and underwriting processes for select industries, highlighting ongoing progress in managing sustainability risks.

The operating environment in Q2 2025 was marked by continued market volatility, broad macroeconomic uncertainty, inflationary pressures, and ongoing geopolitical concerns. These conditions create a challenging backdrop for the firm's diverse business segments.

The filing explicitly notes 'prolonged geopolitical tensions' as a factor influencing the operating environment across all business segments. This risk factor has the potential to negatively impact asset prices, market-making activity levels, and credit losses, adding to overall market uncertainty.

While industry-wide completed mergers and acquisitions volumes increased in Q2 2025, debt underwriting volumes decreased, and equity underwriting volumes increased. Market making activity levels also increased compared to the prior quarter, indicating a varied landscape of opportunities and challenges across different financial sectors.