Goldman Sachs Group Inc reported a 43% drop in profit but beat Wall Street expectations as strong performance in the wealth management business and lower costs cushioned the blow from weaker capital markets activity.

The bank has been taking measures under Chief Executive David Solomon to diversify its revenue stream and earn more from predictable sources like consumer banking, wealth and asset management.

Consumer and wealth management saw a 21% jump in net revenues to $2.10 billion, helped by higher management fees and credit card balances, Goldman said.

Investment banking revenue, however, dropped 36% to $2.41 billion, as fees from advising on stock market listings and debt underwriting declined against the backdrop of heightened tensions between Russia and Ukraine.

"It was a turbulent quarter dominated by the devastating invasion of Ukraine," Chief Executive David Solomon said in a statement.

"The rapidly evolving market environment had a significant effect on client activity as risk intermediation came to the fore and equity issuance came to a near standstill."

Goldman's revenue from advising on deal remained largely unchanged, in sharp contrast to rival Morgan Stanley, whose revenue from the business doubled.

With the U.S. Federal Reserve beginning to wean the economy off pandemic-era support, dealmaking slowed in the quarter and cast a pall over some of Goldman's most lucrative businesses.

In the first quarter, the bank posted profit applicable to common shareholders of $3.83 billion, or $10.76 per share. Analysts had expected $8.89 per share, according to Refinitiv data.

Total net revenue fell to $12.93 billion in the quarter, down nearly 27% from last year. Operating expenses fell 18% in the quarter.

(Reporting by Niket Nishant in Bengaluru and Matt Scuffham in New York; Editing by Arun Koyyur)