Apple Card
Goldman Sachs may be bleeding money faster than previously thought on Apple Card, and it is reportedly trying to escape its partnership with Apple.
A new report claims that Goldman Sachs is in conversation with American Express and possibly even General Motors to escape its Apple Card deal. Citing "people familiar with the discussions," the Wall Street Journal believes that it may take some time for Goldman Sachs to escape the partnership — and Apple would have to agree.
If it manages to do so, getting out of Apple Card would end Goldman Sachs' ambitions in the consumer lending business. It has already taken other measures to do so, in both ceasing personal lending and trying to offload the home improvement financier GreenSky it bought in 2022.
Publicly, Goldman Sachs says that it remains committed to the Apple Card, despite losing money on the deal.
Goldman Sachs spent a lot of money to help launch Apple Card and its other consumer services. A report from January 13 revealed the bank's consumer credit division lost $1.2 billion across nine months in 2022, and the losses were primarily related to the Apple Card.
"In the consumer platforms, we did some things right. We didn't execute on some others," Goldman Sachs CEO David Solomon said in January. "We probably took on more than we should have, you know, too much, too quickly."
Goldman helped launch the Apple Card in 2019 and reportedly spent roughly $350 to acquire every new Apple Card customer. In 2022, it scaled back its efforts to turn its consumer savings business, Marcus, into a fully-fledged digital bank.
Executives of Goldman Sachs' collection of businesses known as Platform Solutions said in January 2023 its consumer division may break even in 2025, although that target was initially by the end of 2022.
"I think we now have a very good deposits business," Solomon said at the time. "We're working on our cards platform, and I think the partnership with Apple is going to pay meaningful dividends for the firm."
