Goldman Sachs and JPMorgan Chase are emerging as AI winners

American megabanks on Tuesday provided evidence that the global artificial intelligence boom is not just benefiting tech giants and chip makers.

Goldman Sachs And JPMorgan Chase each posted record quarterly revenue, driven by big gains in stock trading and investment banking.

Behind the increase in activity — Goldman revenue jumped 39% to $20.3 billion, JPMorgan I saw you rise JPMorgan CFO refers to the fact that AI is ‘everywhere in financial markets’ between 27 percent and $58 billion Jeremy Barnum he told reporters.

“These are emerging environments with tons of activity, major IPOs, major index rebalancing, a lot of activity in Asia,” Barnum said Tuesday. he said. “A lot of this falls under the AI ​​theme and is capitalized on a global basis. It’s just a very, very, very active environment.”

This quarter showed that the AI ​​boom is creating winners far beyond Silicon Valley. During Nvidia and including hyperscalers Alphabet In most of the headlines, Goldman, JPMorgan and other banks are profiting from the massive capital infusion into AI.

They advise on AI-related deals, financing data centers and energy infrastructure, underwriting debt and equity offerings, and facilitating the surge in trade that accompanies the global race to implement the technology.

That’s creating a “ripple effect” in the American economy and offering new opportunities for banks to provide financing and trading solutions in public and private markets, Goldman CEO David Solomon told analysts on Tuesday.

“We are in the middle of an AI capital spending supercycle, with funding demands across every financing instrument, in every region of the world and in every sector,” Solomon said. Capex is short for capital expenditures, or the investments a business makes for physical assets such as factories.

Goldman told analysts it is preparing for a three- to five-year investment cycle that is still in its early stages.

Goldman shares rose 8% in afternoon trading, while JPMorgan rose 2%.

While the AI ​​landscape is not new, what has changed is that it is expanding beyond chips and software to include power providers and infrastructure players.

The biggest beneficiaries of this trend were Wall Street’s three biggest companies: Goldman Sachs, JPMorgan and Morgan StanleyAccording to Wells Fargo banking analyst Mike Mayo.

Helping the quarter, investors poured money into Asian markets including South Korea, Taiwan and Japan, expanding the search for AI beneficiaries. Soofian Zuberi, chairman and co-chairman Global Markets at Bank of America told CNBC.

“People have looked at AI business and asked, ‘What are the best implications of this outside of the United States?'” Zuberi said. “They asked,” he said. “You have American clients, including foundations, endowments and family offices, who are diversifying and allocating more money to Asia.”

The impact of artificial intelligence was also evident in banks’ strong consultancy banking revenue in the second quarter.

At Goldman, investment banking revenue rose 55% to $3.4 billion, and at JPMorgan Chase, it rose 30% to $3.3 billion. That’s a total of $1 billion more than analysts expected.

Goldman served as lead advisor this quarter. SpaceX He handled the IPO and Alphabet’s $90 billion equity issue and advised Dominion Energy on its sale to NextEra Energy; All movements were guided by the AI ​​loop.