Goldman Sachs Issues Digital Equity-Linked Notes Tied to IBM Stock Performance Through 2028

Structure and Settlement Terms of the Equity-Linked Notes

The offering disclosed by GS Finance Corp. establishes a structured note product with clearly defined settlement mechanics tied to IBM stock performance. The notes will be issued on July 22, 2026, and mature on January 21, 2028, with the final underlier level determined on January 18, 2028. The disclosure states that investors will receive cash settlement based on whether IBM's closing stock price on the determination date meets or exceeds the trigger buffer level established at 70% of the initial $219.05 level, which equates to approximately $153.34 per share.

The settlement structure incorporates an asymmetric payoff profile. If the final underlier level remains at or above the trigger buffer level, investors receive the maximum settlement amount of $1,350 per $1,000 face amount of notes. However, if IBM's stock closes below the 70% trigger level, the return becomes negative, and investors experience a loss of 1% of face amount for every 1% decline in the underlier below the initial level. The filing explicitly states that investors "could lose your entire investment in the notes," indicating the product carries substantial downside exposure if IBM shares experience significant depreciation over the note's 19-month life.

IBM Stock as Underlier and Performance Metrics

The disclosure identifies International Business Machines Corporation as the sole underlier for these structured notes, with the initial level established at the closing price on July 16, 2026. The filing specifies that the underlier return is calculated as the difference between the final underlier level and the initial level, divided by the initial level. This calculation determines the magnitude of gains or losses that investors experience on a dollar-for-dollar basis when IBM stock moves below the trigger buffer threshold. The document notes that the initial underlier level of $219.05 "may be higher or lower than the closing level of the underlier on the trade date" of July 17, 2026, indicating potential variance between the pricing date and the actual reference level used for calculations.

Goldman Sachs & Co. LLC has been designated as the calculation agent responsible for determining the final underlier level and computing settlement amounts. The determination date of January 18, 2028, is subject to adjustment as described in the accompanying general terms supplement, meaning potential delays or modifications could occur due to market disruptions or non-trading days. The filing provides no historical performance guidance or projections regarding IBM shares, leaving investors to conduct independent analysis of the technology company's prospects over the note's term.

Pricing and Estimated Value Below Face Amount

The preliminary pricing terms indicate that the estimated value of the notes on the trade date ranges from $925 to $955 per $1,000 face amount, representing a significant discount to the 100% original issue price. This valuation gap reflects the structured note's embedded features, including the leverage inherent in the maximum settlement amount capped at $1,350 and the asymmetric risk profile that allows for total loss of principal. The disclosure states that "Our estimated value of the notes on trade date... is less than the original issue price," signaling to prospective investors that the notes are being offered at a premium to their secondary market valuation estimates.

The filing does not disclose the specific underwriting discount or net proceeds to the issuer at this preliminary stage, noting instead that "the original issue price will be [blank]% for certain investors." The document indicates that subsequent pricing details will be included in the final pricing supplement once the trade is completed. The statement that "The return (whether positive or negative) on your investment in notes will depend in part on the issue price you pay for such notes" emphasizes that investors purchasing at the 100% face amount issuance price face different return profiles than those who might acquire notes in secondary market transactions.

Credit Risk and Guarantor Obligations

The notes are issued by GS Finance Corp. and are "fully and unconditionally guaranteed by The Goldman Sachs Group, Inc." according to the disclosure. This guarantee structure means that investors bear credit exposure to both the issuer and the parent company guarantee. The preliminary pricing supplement directs readers to page PS-5 for detailed discussion of credit risks, though the full content of that section is not included in the filed document. The notes are issued under a senior debt indenture dated October 10, 2008, as supplemented by agreements dated February 20, 2015, with The Bank of New York Mellon serving as trustee.

The filing explicitly states that "The notes are not bank deposits and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, nor are they obligations of, or guaranteed by, a bank." This language clarifies to investors that despite the guarantee from Goldman Sachs, the notes lack the protections afforded to bank deposits. Investors face the dual risk of IBM stock performance triggering negative settlement combined with potential credit deterioration at Goldman Sachs Group or its subsidiary issuer, GS Finance Corp. The disclosure provides no specific information about the creditworthiness assessment or any recent credit events affecting either entity.

Interest and Maturity Terms

The disclosure confirms that "The notes do not bear interest," meaning investors receive no coupon payments during the note's life. This zero-coupon structure concentrates all returns into the maturity settlement payment, which depends entirely on IBM's stock price relative to the initial and trigger buffer levels. The lack of interim cash flows distinguishes these notes from traditional debt securities and concentrates liquidity risk at maturity. The stated maturity date is January 21, 2028, which is three business days after the January 18, 2028 determination date, allowing time for settlement calculation and processing.

The notes will be issued in book-entry form and represented by master note number 3, dated March 22, 2021, according to the filing. Investors holding these notes will not receive physical certificates but instead will maintain their interests through the book-entry system, likely through the Depository Trust Company. The filing provides the CUSIP number as 40054XRP5 and the ISIN as US40054XRP59, enabling investors to identify and track the notes in market systems. The absence of any call provision or early redemption feature mentioned in the filing suggests the notes will run through their full maturity unless trading ceases in secondary markets.

Hypothetical Performance Examples and Scenario Analysis

The preliminary pricing supplement includes a section on hypothetical examples demonstrating how various IBM stock price outcomes would translate into settlement amounts. The filing states that these examples "should not be taken as an indication or prediction of future investment results and merely are intended to illustrate the impact that the various hypothetical underlier levels on the determination date could have on the cash settlement amount at maturity." The examples assume notes are purchased at 100% face amount on the original issue date and held to maturity, with no secondary market trading prior to January 21, 2028.

The disclosure emphasizes that actual returns for investors who sell notes before maturity "will depend upon the market value of your notes at the time of sale, which may be affected by a number of factors that are not reflected in the examples below, such as interest rates, the volatility of the underlier, the creditworthiness of GS Finance Corp., as issuer, and the creditworthiness of The Goldman Sachs Group, Inc., as guarantor." The filing explicitly states that "the actual performance of the underlier over the life of your notes, as well as the amount payable at maturity, if any, may bear little relation to the hypothetical examples shown below or to the historical underlier levels shown elsewhere in this pricing supplement."

Trade Timeline and Registration Details

The trade date for these notes is July 17, 2026, with the original issue date scheduled for July 22, 2026, providing a five-business-day settlement period. The preliminary pricing supplement is dated July 17, 2026, and the document notes explicitly that "The information in this preliminary pricing supplement is not complete and may be changed." This preliminary status indicates that final pricing terms, including specific underwriting discounts and net proceeds to the issuer, remain subject to finalization in a subsequent pricing supplement. The registration statement number is listed as 333-284538, filed with the Securities and Exchange Commission.

The filing indicates that Goldman Sachs & Co. LLC will serve as the sole underwriter for the initial offering. The document states that "GS Finance Corp. may use this prospectus in the initial sale of the notes. In addition, Goldman Sachs & Co. LLC or any other affiliate of GS Finance Corp. may use this prospectus in a market-making transaction in a note after its initial sale." The disclosure explicitly notes that "Unless GS Finance Corp. or its agent informs the purchaser otherwise in the confirmation of sale, this prospectus is being used in a market-making transaction," suggesting that Goldman Sachs anticipates secondary market activity in the notes following their initial issuance.

Document Hierarchy and Prospectus Structure

The preliminary pricing supplement constitutes part of a layered prospectus disclosure structure that includes General Terms Supplement No. 17,745 dated January 20, 2026; a prospectus supplement dated February 14, 2025; and a base prospectus dated February 14, 2025. The filing states that "The information in this pricing supplement supersedes any conflicting information in the documents listed above" and notes that "some of the terms or features described in the listed documents may not apply to your notes." This hierarchy establishes that investors must read all component documents to understand the complete terms, with more recent supplements controlling over older base documents.

The disclosure asserts that GS Finance Corp. has "not authorized anyone to provide any information or to make any representations other than those contained in or incorporated by reference in this pricing supplement and the accompanying documents listed above." The filing takes no responsibility for information provided by third parties and expressly states "This prospectus is being used in a market-making transaction" unless the issuer's confirmation indicates otherwise. The document notes that "The information contained in this pricing supplement and the accompanying documents listed above is current only as of the respective dates of such documents," establishing that more recent market conditions or company developments may not be reflected in the preliminary terms.

Regulatory Status and Distribution Considerations

The preliminary pricing supplement includes standard SEC disclaimers stating that "Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus." The filing emphasizes that "Any representation to the contrary is a criminal offense," establishing the formal regulatory context for the offering. The document confirms the Medium-Term Notes, Series F program status for these notes and references the senior debt indenture framework governing their issuance and terms.

The disclosure addresses potential changes to pricing after the initial offering, stating that "We may decide to sell additional notes after the date of this pricing supplement, at issue prices and with underwriting discounts and net proceeds that differ from the amounts set forth above." This provision allows GS Finance Corp. to conduct follow-on issuances of economically different notes linked to the same IBM underlier. The filing notes that "The original issue price will be [blank]% for certain investors" and references a "Supplemental Plan of Distribution; Conflicts of Interest" section for disclosure regarding "additional information regarding the fees comprising the underwriting discount," indicating that tiered pricing structures may apply to different investor categories.