Goldman Sachs Issues Auto-Callable Securities Linked to Alphabet Stock Performance Through 2029

Structured Note Architecture and Underlying Reference Asset

The securities represent unsecured notes issued by GS Finance Corp. and guaranteed by The Goldman Sachs Group, Inc., making the credit quality of both entities relevant to investors evaluating default risk. The notes are contingent income auto-callable securities, meaning their cash flows and maturity depend on the observed closing price of Alphabet Inc. Class A common stock (Bloomberg ticker: GOOGL UW) on specific observation dates. Investors do not own Alphabet shares directly; instead, they receive payments calculated based on the stock's performance relative to predetermined price levels established at pricing.

The securities will not be listed on any securities exchange or interdealer quotation system, limiting secondary market liquidity and creating challenges for investors who wish to exit the position before maturity. The notes are available in $1,000 denominations or any integral multiple thereof, with authorized denominations structured for institutional and high-net-worth individual investors. The preliminary pricing supplement indicates the estimated value range falls between $905 and $965 per security, suggesting an upfront discount to par value reflecting the structuring costs and embedded options.

Contingent Coupon Payments and Memory Feature Mechanics

The securities offer contingent quarterly coupon payments set at a minimum of $26.25 per $1,000 principal amount per quarter, subject to adjustment on the pricing date. The coupon observation dates occur quarterly on specified dates from November 2, 2026, through July 31, 2029, with corresponding coupon payment dates falling three to four business days later. Critically, these coupons are not guaranteed; they pay only if the closing price of Alphabet stock on the coupon observation date is greater than or equal to the downside threshold price, which the disclosure states represents 65% of the initial share price.

A distinguishing feature of these securities is the memory coupon mechanism, which allows investors to recover missed coupon payments on subsequent coupon payment dates if the stock price recovers above the downside threshold. If the closing price falls below the threshold on a coupon observation date, that quarterly coupon is not paid but remains outstanding and will be paid on a later coupon payment date if the stock price subsequently rebounds to or exceeds the threshold level. However, once a previously unpaid coupon has been paid, it will not be paid again on any subsequent coupon payment date. This structure aims to provide investors some protection against temporary price dislocation, but only if the underlying stock recovers during the security's three-year life.

Automatic Call Feature and Early Redemption Conditions

The securities include an automatic call feature that can terminate the investment before the stated maturity date of August 3, 2029. Call observation dates commence on November 2, 2026, and occur on each subsequent coupon observation date through April 30, 2029. If the closing price of Alphabet stock on any call observation date equals or exceeds the initial share price, the securities will be automatically called, and investors will receive $1,000 per $1,000 principal amount plus any contingent quarterly coupon due on the call payment date. No further payments will be made after the call payment date.

This early redemption mechanism creates a structural asymmetry: investors participate fully in potential downside losses but their upside is capped at the return of principal plus accumulated coupons if the stock merely returns to its initial price level. The automatic call feature protects the issuer by limiting exposure to Alphabet stock appreciation while maintaining leverage to declines. For investors, this means the maximum return is achieved through coupon accumulation and principal recovery, with no participation in any stock price appreciation beyond the initial share price level.

Principal-at-Risk Structure and Downside Threshold Mechanics

These securities are explicitly structured as principal-at-risk investments, meaning investors can lose a significant portion or all of their initial capital. The downside threshold price is set at 65% of the initial share price, establishing the level below which contingent coupons cease and maturity payment formulas shift to a loss scenario. If the final share price on the valuation date (July 31, 2029) is less than the downside threshold price, investors will not receive the full $1,000 principal repayment. Instead, they will receive $1,000 multiplied by the share performance factor, calculated as the final share price divided by the initial share price.

For example, if the initial share price is $100 and the final share price declines to $50, the share performance factor would be 0.50, and investors would receive only $500 per $1,000 invested, representing a 50% loss of capital. The maximum loss occurs if Alphabet stock falls to zero, resulting in complete loss of principal. Additionally, if the stock price remains below the downside threshold throughout the security's term, investors will receive no contingent quarterly coupon payments at all, compounding the loss. This dual-layer downside exposure—both no coupons and reduced principal repayment—underscores why these securities are marketed to investors who accept substantial risk in exchange for higher contingent income yields.

Pricing, Underwriting Economics, and Estimated Value Range

The securities are expected to price on or about July 31, 2026, with the original issue date set for August 5, 2026. Goldman Sachs & Co. LLC serves as the underwriter, with Morgan Stanley Wealth Management acting as a dealer for the offering. The preliminary disclosure states the original issue price equals 100% of the principal amount, with an underwriting discount of 2.25% and net proceeds to the issuer representing 97.75% of the principal amount. Morgan Stanley Wealth Management receives a selling concession of $22.50 for each security sold, with an internally allocated structuring fee of $5.00 per security.

The estimated value range provided in the disclosure falls between $905 and $965 per security, implying a market-based valuation below par that reflects the time value of embedded options, credit spreads, and issuer compensation. This pricing range suggests investors purchasing at the initial issue price will acquire securities at par, with secondary market values potentially fluctuating depending on changes in Alphabet stock volatility, prevailing interest rates, and credit conditions affecting Goldman Sachs. The disclosure notes that Goldman Sachs may decide to sell additional securities after the pricing date at issue prices and underwriting discounts that differ from the initial offering terms, introducing additional variability for early investors relative to later investors.

Registration and Regulatory Classification

The preliminary pricing supplement was filed pursuant to Rule 424(b)(2) under the Securities Act of 1933, with an associated Registration Statement No. 333-284538. The document carries a "Subject to Completion" header dated July 22, 2026, indicating that certain terms remain subject to change before the securities are finalized. The preliminary nature of the filing means the specific initial share price, exact principal amount, and final contingent coupon rate will be determined on the pricing date and reflected in the final pricing supplement and prospectus.

The disclosure explicitly states that neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of the securities or verified the accuracy or adequacy of the prospectus. This language is standard for new securities offerings and does not constitute an endorsement or recommendation. The securities are characterized as unsecured obligations not insured by the Federal Deposit Insurance Corporation or any governmental agency, emphasizing that repayment depends entirely on the creditworthiness of GS Finance Corp. and the guarantee provided by The Goldman Sachs Group, Inc.

Term Structure, Observation Dates, and Payment Schedule

The securities have a scheduled three-year term from the expected issue date of August 5, 2026, through the stated maturity date of August 3, 2029. The determination date, serving as the final valuation point for the final share price and conclusive coupon payment, is expected to be July 31, 2029, subject to adjustment as described in accompanying general terms supplements. The coupon observation dates occur quarterly, with 13 observation dates scheduled through the determination date, providing 12 regular quarterly coupon periods plus the final determination observation date.

The corresponding coupon payment dates follow the observation dates by three to four business days, ensuring investors receive cash flows with minimal settlement delay. Call observation dates begin on November 2, 2026, the first regular coupon observation date, and continue through April 30, 2029, offering the issuer opportunities on eight separate dates to redeem the securities early if Alphabet's stock price remains at or above its initial share price. The structured schedule provides transparency regarding when the automatic call feature may be triggered and when contingent coupons will be evaluated, though the actual payment amounts depend on stock performance events that cannot be predicted in advance.

Investor Profile and Risk Considerations for Holders

The disclosure indicates these securities are designed for investors who seek to earn contingent quarterly coupons at above-market rates in exchange for accepting the risk of receiving few or no contingent quarterly coupons and potential principal loss. This positioning suggests the target investor base includes high-net-worth individuals, institutional investors, and advisors comfortable with structured products and the embedded credit and market risks. The contingent coupon design creates an income-enhancement strategy relative to traditional fixed-income instruments, but only if Alphabet stock performs adequately relative to the downside threshold.

Key risks highlighted in the disclosure include credit risk of GS Finance Corp. and The Goldman Sachs Group, Inc., as well as the primary market risk that Alphabet's stock price may fall below the downside threshold, eliminating coupon payments and reducing principal repayment. Investors also face reinvestment risk if the securities are called early, forcing liquidation of the position at a time when prevailing interest rates or stock market conditions may be unfavorable. The non-listed nature of the securities means secondary market liquidity is limited, potentially making it difficult or costly to exit the position before maturity if circumstances change.

General Terms Supplements and Adjustment Provisions

The preliminary pricing supplement references accompanying general terms supplements that govern additional mechanics and adjustment provisions not fully detailed in the preliminary supplement itself. These supplements address adjustments to observation dates, valuation dates, and share prices in response to corporate actions affecting Alphabet stock, such as stock splits, dividend distributions, or other extraordinary events. Investors should review the complete general terms supplement and final prospectus to understand the full scope of adjustment mechanisms and how they may affect calculated returns and payment timing.

The disclosure indicates that all dates referenced—including coupon observation dates, coupon payment dates, call observation dates, and call payment dates—are subject to adjustment as described in the accompanying general terms supplement. This language is customary for structured products and reflects the reality that unexpected corporate actions or market disruptions may require date modifications to preserve the economic intent of the securities. Final investors should request the complete prospectus and all exhibits before committing capital to ensure full understanding of these adjustment mechanisms and their potential impact on returns.

Market-Making and Secondary Market Considerations

The preliminary pricing supplement discloses that Goldman Sachs & Co. LLC or other affiliates of GS Finance Corp. may use the prospectus in market-making transactions in the securities after the initial offering. This indicates the potential for secondary market trading facilitated by the underwriter, though the securities are not listed on any exchange or quotation system. Secondary market pricing will depend on supply, demand, changes in Alphabet stock dynamics, prevailing interest rates, and credit conditions affecting Goldman Sachs, creating variability between the initial issue price and any secondary market transaction price.

Investors considering a secondary market purchase or sale should recognize that quoted prices in market-making activities may not reflect the securities' intrinsic value or the underlying economics of the contingent income stream. The absence of a formal exchange listing means less price discovery and transparency compared to exchange-traded securities, and bid-ask spreads may be wider, increasing transaction costs for investors exiting positions. The preliminary supplement does not quantify typical spreads or provide guidance on expected secondary market depth, leaving investors to assess liquidity conditions based on communication with Goldman Sachs or other market participants.