This morning the former investment banking god turned bank holding company Goldman Sachs reported its first quarterly loss since going public in 1999, booking a $2.12 billion loss (it previously incurred a quarterly loss in 1998 while a top secret, private enterprise).
Despite being in the red for its fiscal fourth quarter (ended November 30), the firm’s earnings (that is, losses) beat several analysts’ estimates and, as a result, its shares have risen nearly 10 percent in early trading (as of 12:12 p.m.). Which isn't bad for posting a $4.97 per share loss.
In addition to losing a bundle, Goldman laid off 8 percent of its staff during the quarter and cut in half its pay per employee as well as overall compensation to insiders, largely thanks to bonuses being slashed for many employees, including head honcho Llolyd Blankfein. The salary cuts are important not only to Goldman insiders but to outsiders, as the reductions underline an industry-wide move to minimize banker pay as a way (perhaps the biggest) to cut costs and thus scrape back into the black in 2009.