Goldman Sachs released its first-quarter earnings this morning. Reuters' Lauren LaCapra reports that profit was down 11% compared to last year and revenue from fixed income, currency, and commodities (FICC) was down 11% compared to last year. LaCapra writes that "since 2009 - when markets flourished briefly in the aftermath of the financial crisis," Goldman's FICC business has been declining steadily as a portion of its overall revenue.
Quartz's Mark DeCambre charts the post-crisis decline in FICC's contribution to Goldman's overall revenue. In the first quarter of 2014, FICC accounted for $2.85 billion, or 30%, of Goldman's $9.33 billion in total revenue.
Addressing FICC's performance on this morning's earnings call, CFO Harvey Schwartz said, "we don't look at it on a quarter by quarter basis. We look at it on a multi-quarter basis." Different businesses within the unit will be up some quarters and others will be down, so, Schwartz said, "if you are going to be in these businesses, you really need diversification."
Diversification may be helping to smooth out volatility in Goldman's FICC revenue, but it's smoothing out a decline. On the multi-quarter time-frame Schwartz referenced, FICC revenue seems to be idling at around 25-30% of total revenues.