Big US banks report higher profits as markets and AI investment lift results

Large US banks reported sharply higher second-quarter profits on Tuesday, helped by strong financial markets, AI-related stock gains and a solid US job market despite continuing consumer concern about inflation.

JPMorgan Chase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs all reported year-on-year profit increases. Together, the five banks earned nearly $50 billion during the quarter.

JPMorgan Chase Chief Financial Officer Jeremy Barnum described the stock market as "boomy". Goldman Sachs Chief Executive David Solomon said investment linked to artificial intelligence remained at an early stage and was expected to support a multi-year spending drive, while warning that the buildout would have setbacks and adjustments.

The results came even as executives pointed to risks that had so far been easier to manage than expected. The report cited the renewed heating up of the US-Iran war, nervousness in private credit shown by elevated redemption requests, and volatile consumer sentiment linked to inflation and affordability.

JPMorgan Chief Executive Jamie Dimon said in an earnings release that the US economy had shown notable resilience through stronger business investment and hiring. He also warned that risks were shifting below the surface. On a call with reporters, he said inflation and geopolitics should be watched because they could fade or combine in surprising ways.

JPMorgan reported second-quarter profit of $21.2 billion, up 41 percent from a year earlier. Revenue rose 28 percent to $57.3 billion. Its markets division benefited from a strong quarter for US equities. The Nasdaq rose 21.4 percent during the quarter, its best three-month performance in six years, as AI-related shares surged. JPMorgan also recorded a $4.6 billion gain on Visa shares.

JPMorgan lowered its 2026 forecast for credit card charge-offs, citing a US consumer helped by tax refunds and a healthy job market and less affected than expected by higher gasoline prices linked to the US-Iran war. Dimon said the global economy had proved more resilient than expected, while cautioning that a tipping point could still exist.

Bank of America, the second-largest US bank by assets after JPMorgan, reported $8.7 billion in profit, up 27 percent. Chief Executive Bryan Moynihan said its markets-facing businesses had an exceptional quarter. Citigroup posted $5.8 billion in profit, up 45 percent. Wells Fargo reported $6.4 billion, up 17 percent.

Goldman Sachs reported profit of $6.4 billion, up 84 percent, and revenue of $20.3 billion, up 39 percent. The investment bank posted gains across much of its global banking and markets business. Equities revenue rose 72 percent to $7.4 billion. Fixed income revenue was significantly higher, mortgage revenue was higher, and currency revenue was slightly higher.

Solomon said Goldman Sachs sees opportunities to finance AI infrastructure for clients. He also said there is uncertainty over how much infrastructure will be built, how it will be priced and how technological breakthroughs will affect the market.

Near midday, JPMorgan shares were up 2.0 percent, Bank of America rose 1.8 percent and Goldman Sachs rose 6.7 percent. Citigroup fell 4.9 percent and Wells Fargo fell 2.4 percent.