Goldman Sachs
has experienced additional losses in their credit card business, mainly due to the
Apple
Card. The investment bank has recently shared its financial results for Q2 2023, indicating that they are still facing challenges with the
Apple Card
and other portfolios.
The business platform that includes the Apple Card reported revenue of $659 million, representing a 17% increase from the previous quarter and a 92% increase from the same period last year.
Despite this growth, the segment experienced a net loss of $672 million, primarily due to $544 million in credit loss provisions and $987 million in operating expenses.
Goldman
Sachs' "Platform Solutions" businesses, including the Apple Card, have resulted in a loss of $3 billion till 2022. Most of the $1 billion loss in 2021 came from the Apple Card, and another $2 billion in 2022 losses are believed to come from the Apple Card and GreenSky mostly.
Goldman entered into a partnership with Apple, in 2019, to provide consumer lending, which included the Apple Card. Recently, the two companies announced a savings account with high yields, exclusively for Apple card users. Additionally, the two companies are also offering "Pay Later" service in the US to Apple users, which enables users to divide purchases into four payments over six weeks without any interest or fees.
Goldman Sachs is reportedly trying to cut short its partnership with Apple, despite CEO
David Solomon
previously referring to it as the most successful credit launch to date. However, in a recent interview with CNBC, Solomon acknowledged that the company's consumer banking services were not executed effectively.
The bank is in talks with
American Express
about acquiring the Apple credit card and other services that both companies offer together. These discussions have been ongoing for several months, and Apple is said to be aware of them, according to The Wall Street Journal's report.
