You might think, having achieved a nearly two-decade-old incomprehensible dream, having held off all comers (for now), having bested even the best hopes of analysts, and now, having weathered the coronavirus storm better than anyone else, Morgan Stanley CEO Jim Gorman might allow himself a bit of a breather on the overweening paranoia, a small, slight sigh of sunny satisfaction. But no. Those trading results that kept his bank (and every other) afloat (to whatever extent they were afloat) in the first quarter are illusory and gonna go away and oh god how many more people is he gonna have to fire?
The bank said earnings dropped 30% to $1.7 billion, or $1.01 a share, compared with the $1.14 estimate of analysts surveyed by Refinitiv…. “Though we are unable to estimate the extent of the impact, an extended period of depressed economic activity necessitated to combating the disease, and the severity and duration of the related global economic crisis, will adversely impact our future operating results, and the attainment of our financial targets,” the bank warned. It added that the new environment might feature “many of the same negative impacts and without the potential benefit of higher client trading activity experienced in the first quarter….”
They can still achieve their two-year targets, but they need the operating environment to normalize, and it would be “irresponsible of me to recommit to those targets on this call,” Gorman said.