Goldman Sachs CEO Solomon flags $500M jump in non-compensation expenses for Q3

Goldman Sachs CEO David Solomon told investors on September 16 that the bank’s non-compensation expenses are on track to come in more than $500 million higher this quarter compared to Q2, a figure large enough to make even Wall Street’s most seasoned analysts reach for their spreadsheets.

Speaking at the Barclays Global Financial Services Conference, Solomon offered a split-screen view of the firm’s current state: the equity business continues to hum along nicely, while FICC, the fixed income, currencies, and commodities division, is running softer. For a bank that just posted one of its strongest quarters in recent memory, the cost guidance introduces a new wrinkle heading into the Q3 earnings release expected around mid-October.

A blockbuster Q2 sets the stage

Goldman’s Q2 2026 results were, by most measures, exceptional. The firm reported net revenues of $20.34 billion and net earnings of $6.63 billion. Global Banking & Markets, the division that houses both equities and FICC, pulled in $15.52 billion in revenue. The equities business alone generated $7.42 billion, a staggering 72% increase year-over-year.

Operating expenses in Q2 already climbed 26% year-over-year to $11.67 billion. The bank attributed the rise to higher compensation, benefits, and transaction-based costs.

Now Solomon is signaling that the expense side of the ledger is about to get even heavier. An additional $500 million in non-compensation costs on top of an already elevated base raises legitimate questions about margin compression, particularly if the revenue picture doesn’t keep pace.

Equities strong, FICC softer

Solomon’s commentary on the trading businesses tells two very different stories. The equities franchise, which was the star of Q2 with that 72% revenue surge, apparently still has momentum. FICC is a different matter. Solomon described the business as softer this quarter.

Where the extra $500M might be going

Solomon didn’t provide a granular breakdown of what’s driving the non-compensation expense increase. The lack of specificity is itself telling. When a CEO volunteers a $500 million expense figure without detailed context at an industry conference, it often functions as an expectations-management exercise. Better to get the number out early and let the market digest it gradually than to surprise investors on earnings day.

What to watch heading into October

Goldman’s Q3 earnings report, expected around mid-October, will be the moment of truth for Solomon’s forward guidance. If Goldman can sustain something close to Q2’s $20.34 billion top line, absorbing an extra $500 million in non-compensation expenses becomes manageable. If revenues dip, particularly if FICC weakness is more pronounced than Solomon suggested, the margin hit could be meaningful.

Second, investors will want to understand the nature of the expense increase. One-time costs are very different from structural ones. If the spending reflects ongoing investments in technology or new business lines, the market may give Goldman credit for building future capacity.