Wall Street just posted one of the best quarters in its history. Goldman Sachs had the best quarter in its 157-year existence. JPMorgan beat estimates by one of the widest margins in years. Trading and dealmaking revenue surged across every major bank. And yet, in that same quarter, the industry’s largest firms collectively cut more than 10,000 jobs.

This isn’t a contradiction so much as a strategy. The banks aren’t cutting because business is bad — they’re cutting because AI lets them run the same, or a bigger, business with fewer people, and they’re doing it now, while profits are strong enough to absorb severance costs and fund the technology that makes the cuts possible. The cuts are also not evenly distributed. Almost everywhere, the reductions are concentrated in operations, middle-office, and back-office functions, while front-office bankers and traders — the people who generate revenue — are largely being protected, and in some cases even added.

Here’s a bank-by-bank look at the scale of the reductions and, more importantly, exactly where inside each organization they’re landing.

The industry-wide numbers

  • Bloomberg’s tally of Q2 2026 workforce disclosures found headcount at Bank of America, Wells Fargo, Citigroup, Goldman Sachs, and Morgan Stanley combined fell by more than 10,000 employees in the second quarter alone — during the same quarter these firms posted record trading and investment banking results.
  • That builds on a 2025 in which the six largest Wall Street banks cut their combined headcount by the most since 2016. Combined, the six ended 2025 with about 1.09 million employees, the lowest total since 2021.
  • Separately, a broader survey found six of the largest banks shed roughly 15,000 jobs in the first quarter of 2026 alone while posting $47 billion in collective profit, up 18% year over year.

Bank by bank: how big, and where

Citigroup — the deepest and most structural cuts in the group

Citigroup’s restructuring is the most aggressive of any major U.S. bank. CFO Mark Mason has confirmed the bank remains on track to cut about 20,000 roles by the end of 2026 as part of a broader plan that, combined with the planned spinoff of its Mexican retail banking arm (Banamex), will shrink total headcount by roughly 60,000, down to about 180,000 employees.

Roughly 40,000 of that reduction comes from the Banamex separation rather than direct job elimination. The remaining ~20,000 is squarely aimed at middle-office and operational functions. CEO Jane Fraser told staff in a January memo that the bank is “not graded on effort,” and that AI and automation would let Citi run middle-office and operational functions with fewer people. The bank’s AI tools now reach roughly 182,000 employees across 84 countries, with adoption above 70%. CFO Mason has also said further headcount declines are expected in 2026 and beyond, describing the changes as permanent and strategic rather than a response to a downturn.

Wells Fargo — the longest continuous streak, driven by “operational support” roles

Wells Fargo has now posted 24 consecutive quarters of headcount reduction as of Q2 2026. Its workforce is down about 25% since Q2 2020, ending 2025 at roughly 205,000 employees (severance costs of $612 million pushed up Q4 2025 expenses). CEO Charlie Scharf has said the bank now has more tools than ever to drive efficiency, “especially with AI,” and has described AI’s long-term impact on staffing as “extremely significant.” CFO Mike Santomassimo went further on the Q2 2026 call, saying the bank expects it “should be able to run this company with less headcount” than it currently has.

Wells Fargo’s own framing is explicit about where the cuts are landing: the bank says it has been able to expand client-facing roles while reducing operational support positions — the same front-office-protected, back-office-targeted pattern showing up industry-wide. Scharf has also indicated a preference for achieving reductions through natural attrition rather than layoffs where possible.

Bank of America — mostly quiet reduction, with some front-office trimming too

After holding headcount roughly flat at 213,000 through 2025, CEO Brian Moynihan told investors he expects the total to decline in 2026, citing “operational excellence and applications of new technologies, including AI” as the bank’s top expense priority. Notably, BofA hired around 17,000 people in 2025 — but largely to backfill departures rather than to grow, with CFO Alastair Borthwick describing a practice of reviewing whether a role needs to be refilled at all when someone leaves.

BofA is a partial exception to the “front office is untouched” pattern: a reported 1% headcount reduction across its global banking and markets division did include managing directors, directors, and vice presidents — meaning some senior client-facing bankers were affected, not just support staff. At the same time, Moynihan has pointed to functions like audit — which had expanded in recent years to meet heavier regulatory demands — as an example of where AI could eventually support a smaller team, suggesting compliance and control functions remain a primary target going forward.

JPMorgan — steady headcount, but a clear internal reshuffling

JPMorgan is the clearest case of “redeployment, not reduction.” Total headcount has held roughly steady at around 318,500. But CEO Jamie Dimon disclosed on the July 2026 earnings call that AI has already eliminated 30% to 40% of headcount in specific units — with most of those employees redeployed to other roles inside the bank rather than let go.

The bank has published a rare, specific breakdown of where the shift is happening: operations roles have been trimmed by about 4%, and general support functions by about 2%, while positions tied to client engagement and revenue generation actually rose about 4%. JPMorgan is backing this with real investment — the bank is spending $19.8 billion on technology in 2026, up $2 billion from the prior year, and reports that productivity in AI-using divisions has roughly doubled to about 6%. Dimon has also said publicly that the bank will likely hire more AI specialists and fewer traditional bankers going forward, signaling a longer-term shift in hiring mix even without net headcount decline today.

Goldman Sachs — an internal AI program aimed squarely at the back office

Goldman launched an internal initiative called “OneGS 3.0” in late 2025, an AI-driven overhaul explicitly targeting sales support, client onboarding, lending operations, regulatory reporting, and vendor management — again, functions that sit behind the revenue-generating desks rather than on them.

The headcount picture at Goldman is genuinely mixed depending on the source. Workforce-tracking data (Revelio Labs) shows Goldman’s total headcount actually growing about 6.4% year-over-year to roughly 49,384 employees in 2026, even as the firm’s active job postings fell 44.7% — suggesting hiring velocity is slowing sharply even where total headcount hasn’t dropped. That sits in tension with Bloomberg’s finding that Goldman was one of the contributors to the industry’s >10,000 Q2 2026 headcount decline. Reporting from January 2026 had also described Goldman as one of the banks still growing headcount through 2025, alongside Morgan Stanley. Given the conflicting data, Goldman’s precise net headcount trend is the least settled of any bank in this group — but the direction of its internal program (OneGS 3.0) is unambiguous: it’s a back-office and operations initiative, not a front-office one.

Morgan Stanley — limited public detail, similar overall direction

Morgan Stanley discloses less granular headcount detail than its peers, but was named alongside Goldman as a contributor to the >10,000 industry-wide Q2 2026 decline, and earlier reporting had grouped it with Goldman as one of the banks still adding headcount through 2025. There isn’t yet a public, division-level breakdown comparable to JPMorgan’s — a gap worth watching as more of the bank’s 2026 disclosures come out.

Why this pattern is showing up everywhere

The through-line across every bank’s public statements is the same: AI is being pointed first at the functions that support deals and transactions — operations, middle-office reconciliation, client onboarding and KYC, regulatory reporting, compliance, audit — rather than at the bankers and traders who originate revenue. That’s a deliberate allocation choice, not an accident. Executives across the industry have described this as structural rather than cyclical: Citigroup has explicitly said its changes are “permanent,” and Wells Fargo’s CEO has been cutting headcount for six straight years regardless of the business cycle.

This is also happening industry-wide, not just at the largest U.S. banks. HSBC has floated cutting up to 20,000 roles — about 10% of its workforce — as part of a similar AI-driven back-office overhaul, and Germany’s Commerzbank has announced plans to cut 3,000 jobs on comparable reasoning.

What it means going forward

Put together with what banks are saying about the rest of 2026 — a deep M&A and IPO backlog, executives calling for a “golden age” of investment banking, and bonus pools projected to rise fastest for advisory and equities professionals — the emerging picture is a bank that looks smaller on paper but is not necessarily hiring less in the parts of the business that make money. The operational tail behind each deal is shrinking. The deal teams themselves, so far, largely are not. Whether that holds if deal volume ever slows is the open question — right now, banks are cutting the back office during the best revenue environment in years specifically so they don’t have to cut the front office when the cycle eventually turns.

Note on sources: figures and quotes in this article are drawn from company earnings calls, CFO/CEO public statements, and financial press coverage (Bloomberg, Banking Dive, The Digital Banker, Business Insider, and others) through late July 2026. Some figures — particularly Goldman Sachs’s exact headcount trend — vary between sources and should be treated as directionally reliable rather than precise.