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Goldman Sachs’s Apple Card unit loses $1.2 billion in nine months

By Jonathan Easton

The Goldman Sachs business which houses Apple’s credit card lost more than $1 billion in its first nine months of 2022.

According to a regulatory filing, the bank’s Platform Solutions unit generated $1.2 billion in pretax losses. Concerningly for Goldman, the filing shows that the drop accelerated each quarter.

The Platform Solutions business initially started life as the bank’s lofty attempt to build a digital bank of the future for the consumer market. However, persistent costs and the challenges of starting new lines of business caused Goldman to scale back its plans.

The filing shows that the unit, whose performance is not currently tracked in Goldman’s quarterly reporting, has been a persistent drain on the bank and has seriously impacted its bottom line.

In total, since the start of 2020 through to the end of September, the unit’s pretax losses added up to $3 billion. This will increase to $4 billion in losses over three years once the latest quarter is factored in.

A deep dive into the filing from Bloomberg noted that the transaction-banking business is “probably the only profitable element”. The report cites sources familiar to the numbers who claim that the division’s $1 billion pretax loss for 2021 was mostly tied to the Apple Card, with $2 billion in 2022 coming from Apple Card and instalment-lending platform GreenSky.

While this consumer-oriented unit was supposed to break even by the end of 2022, Bloomberg’s sources say that executives in the division now are expecting that achievement in 2025.

As it looks to protect its bottom line, Goldman Sachs has begun one of its biggest rounds of job cuts ever. The company is looking to cut around 3,200 staff this year.

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