Goldman Sachs share price: 4 things to watch for in Q1 results

The investment bank has to address these five issues before its Q1 earnings report.

Goldman Sachs share price could change based on a number of variables. Here are four factors that could impact Goldman Sachs Q1 earnings next week.

Will the 1MDB scandal affect Goldman Sachs Q1 earnings?

The Malaysian 1MBD bank fraud scandal could cast a long shadow over Goldman Sachs. Three bankers have been charged with misappropriating $2.7 billion meant for a development company in the Asian country. The financial institution denies any intentional wrongdoing, but Malaysia is still suing the bank to try to recover the funds. Goldman Sachs’ Q1 revenue could be impacted by the international bank fraud.

Did the economic volatility of 2018 affect Goldman Sachs Q1 profits?

Economic volatility in the US and the UK in 2018 may have an influence on Goldman Sachs’ Q1 profits. Uncertainty about Brexit and the US government shutdown earlier this year could mean less revenue for investment banks. Goldman Sachs’ Q1 revenue may be affected by the downturn in the US stock market in late 2018.

Will layoffs impact Goldman Sachs Q1 revenue?

The bank conducted its annual March layoffs, with about 65 layoffs of traders in the underperforming fixed income division. Michael Spellacy, Accenture’s senior managing director for capital markets, said that layoffs are a way to increase Goldman Sachs’ Q1 profits and decrease excessive costs.

‘There are a handful of US investment banks who make a relatively normal economic profit, but their cost base is bloated and far in excess of the norm,’ said Spellacy. Investors will see if Goldman Sachs Q1 revenue will be affected by the recent layoffs.

Could collaborating with Apple influence Goldman Sachs Q1 profits?

Goldman Sachs Q1 earnings could be helped by another corporation-Apple. The recent announcement of Apple launching a credit card in a partnership with the bank may possibly influence Goldman Sachs Q1 profits. The venture draws the 150-year-old financial institution into the new world of fintech. Dave Murphy, senior vice president of Publicis Sapient, said that the Goldman Sachs/Apple Card deal will help Goldman Sachs remain relevant.

‘Today banks may not be necessary, but the services banks offer are. They need to be able to prove to customers that they can protect those accounts and the assets the way banks are proven to do,’ said Murphy.

Goldman Sachs has to prove to investors that it can survive scandals and layoffs to improve its revenue. Goldman Sachs Q1 earnings could determine how big banks are faring overall in early 2019.

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