Goldman CEO expects AI to create financing boom due to demand for infrastructure

By Ciara Linnane

AI is already creating an ecosystem of activity in Goldman's investment-banking and markets businesses

Goldman Sachs is expecting the development of artificial-intelligence technologies to create strong demand for infrastructure that will require financing and thus become a major tailwind for its business.

Speaking to analysts on the company's earnings call on Monday, Chief Executive David Solomon said AI is already creating an ecosystem of activity in Goldman's (GS) investment-banking and markets businesses.

"I actually think it's a very constructive runway of opportunity sets for our clients as people reposition businesses, and we're talking about a level of scale that is candidly ... unprecedented," Solomon said, according to a FactSet transcript.

The opportunity will stretch out over the next five to 10 years and include investment by governments as they move to create infrastructure.

For Goldman itself, AI is expected to create productivity and efficiency gains, he said.

"Our use cases that we're testing and we're implementing focus on those two areas. But I'd really like the focus to be more on productivity and the ability to scale our smartest people to do more with our clients, rather than expecting an efficiency gain that becomes very cost-accretive," he said.

Goldman has hired a team of engineers to explore and apply machine-learning and AI applications.

AI has come up in virtually every one of his recent conversations with clients, he said.

Solomon made the comments as Goldman reported first-quarter earnings that blew past analyst expectations.

The stock was up 3.7% Monday, while the S&P 500 SPX was up 0.1%.

-Ciara Linnane

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04-15-24 1120ET

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