Shares fall as profits up less than expected

Earnings for the quarter ending March 31 were $2.3 billion, up 80.2 percent from the year-ago period.

Goldman Sachs chairman and CEO Lloyd Blankfein, pictured in 2015, said the company is well-positioned to not only meet our clients' diverse needs, but also to generate operating leverage for our shareholders

Earnings for the quarter ending March 31 were $2.3 billion, up 80.2 percent from the year-ago period, due in part to accounting change in employee share-based compensation that reduced taxes by $475 million.

Revenues rose 26.6 percent to $8.0 billion.

Goldman reported a middling performance in its institutional client business, with net revenues down two percent from the year-ago period. This division includes trading for fixed income, equities and other security-based products, a strong point at other banks this quarter.

Goldman's performance was better in its investing and lending business, where it scored a big jump in revenues due in part to elevated equity prices and greater net interest income with higher interest rates.

In its "investment banking" segment, Revenues from merger and acquisition advising fell from the year-ago period, but underwriting posted a strong gain.

"The operating environment was mixed, with client activity challenged in certain market-making businesses and a more attractive backdrop for underwriting in our investment banking franchise," said Goldman Sachs chief executive Lloyd Blankfein.

"As the economy improves, we are well-positioned to not only meet our clients' diverse needs, but also to generate operating leverage for our shareholders."

Earnings translated into $5.15 per share, below the $5.31 estimated by Wall Street analysts.

Goldman Sachs shares dropped 2.6 percent to $220.30 in pre-market trading.

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