Goldman Sachs revenue jumped 39% to $20.3 billion in the second quarter. JPMorgan Chase’s rose 27% to $58 billion. Both were records, and both banks pointed to the same cause. “A lot of it is downstream of the AI theme, writ large on a global basis,” JPMorgan CFO Jeremy Barnum told reporters on 14 July, according to CNBC.
The AI boom, in other words, is paying Wall Street as well as Silicon Valley. Nvidia and the big cloud companies took most of the headlines. The banks are advising on the deals, financing data centers and power infrastructure, underwriting debt and equity, and handling the trading that has followed.
Trading and deal fees
Equities desks showed it most clearly. CNBC reported that equities trading revenue rose 86% to $6 billion at JPMorgan and 72% to $7.42 billion at Goldman. At Bank of America it climbed 70% to $3.6 billion. Together the first two beat analyst expectations by a wide margin.
Advisory work was strong too. Investment banking revenue at Goldman rose 55% to $3.4 billion, and at JPMorgan 30% to $3.3 billion, about $1 billion above what analysts had expected between them. Bank of America’s investment banking fees jumped 50% to $2.1 billion. Goldman led the SpaceX IPO and Alphabet’s equity issuance, and advised Dominion Energy on its sale to NextEra Energy.
Goldman CFO Denis Coleman called it “an AI capex super cycle” with demands on financing “in every single financing instrument, in every region of the world and across every single industry.” CEO David Solomon said the bank is preparing for a three-to-five year investment cycle that is still in its early stages. Goldman shares rose 8% in afternoon trading that day, and JPMorgan’s rose 2%.
Wells Fargo analyst Mike Mayo said the AI investment boom “reached a tipping point” in the quarter. Soofian Zuberi of Bank of America told CNBC that investors had also spread their AI bets into Asian markets, including South Korea, Taiwan and Japan.
Profits across the sector
Global Finance Magazine looked at the wider group in early August. JPMorgan’s second-quarter net income rose 41%, Goldman’s 84% and Morgan Stanley’s 57.7%. Citigroup’s rose 45%, Bank of America’s 27% and Wells Fargo’s 16.6%. In Europe, UBS reported a 134% increase, Santander 17%, Barclays 15.3% and Deutsche Bank 10%.
Many of the banks expect to meet or beat their full-year 2026 targets. Barclays raised its profit forecast to £31.5 billion from £31 billion, and UBS CFO Todd Tuckner said he is “confident” the bank will exceed its targets.
Using AI inside the bank
The technology is also helping banks hold down costs. Zuberi said AI is driving banking “by helping streamline processes,” and that banking is driving AI because data centers need financing. Staffing numbers show the other side of that. Citigroup cut 5,000 jobs in the quarter, taking headcount to 219,000. Wells Fargo cut 3,500 to 197,000, and UBS cut 2,500 to under 100,000. Wells Fargo CFO Mike Santomassimo said the bank still hires branch bankers, advisors, investment bankers and traders, while expecting “more efficiency from here.”
Sources
- Goldman Sachs and JPMorgan Chase are emerging as AI winners
- Big Banks Signal Strong 2nd Half After Q2 Earnings Soar | Global Finance Magazine
