Companywide revenue rose 27 percent to $8.03 billion, compared with the $8.33 billion average estimate of analysts surveyed by Bloomberg.
Goldman Sachs Group Inc reported an 80 per cent jump in quarterly profit as the Wall Street bank benefited from a pick up in global equity and debt offerings.
Overall, Goldman posted $2.26 billion in profit, or $5.15 a share, which was a 99 percent increase from last year's abysmal first quarter.
The New York-based investment bank earned $2.16 billion compared with $1.2 billion in the same period a year earlier.
Goldman Sachs reported $1.46 billion in net revenue from the Investing and lending department, a large increase from Q1 2016, though unchanged from Q4 2016.
This time, though, Goldman blamed its disappointing results on low volatility in the market-also known as Wall Street's "fear index"-making its customers less interested in trading their portfolios, especially foreign exchange and commodity assets". This is the first time Goldman reported a miss on earnings since the fourth quarter of 2015.
Goldman shares were down 2.8 percent at $219.95 in premarket trading.
After the early morning earnings report, shares had fallen more than 3 percent, reversing a premarket gain of more than 1 percent ahead of the announcement.
In a statement, Goldman Sachs Chairman and CEO Lloyd Blankfein called the quarter "mixed" and that client activity was "challenged".
Goldman said "significantly" lower net revenues from commodities and currencies offset "significantly" higher net revenues in mortgage products. Bank of America Corp beat expectations on Tuesday due to surge in trading revenue, similar to results from JPMorgan Chase & Co and Citigroup Inc last week. Bank of America also reported earnings Tuesday, beating or meeting Wall Street expectations on nearly every single metric.
However, the bank still failed to meet Wall Street expectations.
Earlier this year, the US 2-year yield hit fresh highs going back to the financial crisis, just ahead of the Federal Reserve's second interest rate hike in three months this March.
Goldman Sachs's share price surged 32 percent from the USA presidential election through the end of previous year on optimism Trump would usher in pro-growth economic policies, and as firm alumni including former President Gary Cohn took up key positions in the administration.
Goldman Sachs's stock dropped $9.88, or 4.4 percent, to $216.36. The dividend will be paid on June 29 to common shareholders as of June 1. Turnover was up from $6.34bn in the first quarter of 2016, but down from $8.17bn on the last quarter.