Goldman Sachs Goes All-In on AI... But Wall Street Isn’t Buying the Hype

It was supposed to be Goldman’s victory lap. Instead, the market yawned, sipped its latte, and marked the stock down. Turns out even when you print billions, investors still want fireworks, not PowerPoints about AI.

What Goldman did

1. Dropped the AI bomb.
   Goldman unveiled OneGS 3.0, its shiny new “AI-first” operating model designed to automate everything from client onboarding to compliance. Translation: the robots are coming for the spreadsheets.
2. Trimmed the fat (and maybe a few jobs).
   CEO David Solomon told staff the firm will “reinvest efficiency gains,” which in corporate-speak usually means hiring freezes and targeted layoffs. Cue nervous laughter on the trading floor.
3. Posted knockout numbers.
   Q3 earnings came in hot, around US$12.25 a share on US$15 billion of revenue, comfortably ahead of analyst estimates. Investment banking and asset management carried the load, proving Goldman still rules the deal table.
4. Went shopping in Silicon Valley.
   Goldman inked a near US$1 billion deal to acquire Industry Ventures, a venture capital and secondary fund specialist. It is a move that pulls the firm deeper into private markets, right where the money is quietly compounding.
5. Watched the stock drop anyway.
   Despite all that, shares slipped about 2 to 3% on the day. The Dow fell too, but Goldman’s decline stood out. The market just was not feeling the victory lap

Why Wall Street is not convinced

1. Costs are creeping higher.
   Revenue soared, but expenses outpaced expectations. Margins are the new religion on Wall Street, and Goldman’s are looking a little mortal.
2. The restructuring chill.
   “OneGS 3.0” sounds visionary, but investors hate uncertainty. Job cuts and workflow overhauls can easily dent morale, disrupt client coverage, or delay deal pipelines.
3. The party might not last.
   Much of the quarter’s outperformance came from a burst of M&A and capital markets activity, a nice rebound but one that may not repeat if rates stay sticky and markets wobble.
4. The bar was sky high.
   After a monster year-to-date rally, Goldman was priced for perfection. The Street wanted fireworks. It got a sparkler.
5. The macro hangover.
   Broader “risk-off” sentiment, driven by tariff talk and slowing growth fears, dragged the entire banking sector lower. When everyone is ducking for cover, even a stellar print cannot save you

The takeaway

Goldman just pulled off the corporate equivalent of running a marathon, hitting a personal best, and still getting booed by the crowd. The fundamentals look strong, the AI pivot is bold, and the venture play makes sense. But until investors see lasting margin expansion and a clearer post-AI roadmap, the market’s likely to keep its arms folded.