The AI boom just found two new winners: Goldman Sachs and JPMorgan Chase

American megabanks on Tuesday gave evidence that the global artificial intelligence boom isn’t just benefiting tech giants and chip makers.

Goldman Sachs and JPMorgan Chase each posted record quarterly revenue hauls, fueled by massive gains in equities trading and investment banking.

Behind the surge in activity — Goldman revenue jumped 39% to $20.3 billion, while JPMorgan saw it rise 27% to $58 billion — is the fact that AI is “everywhere in financial markets,” JPMorgan CFO Jeremy Barnum told reporters.

“These are booming environments with a ton of activity, big IPOs, big index rebalancing, a lot of activity in Asia,” Barnum said Tuesday. “A lot of it is downstream of the AI theme, writ large on a global basis. It’s just a very, very, very active environment.”

The quarter showed that the AI boom is creating winners far beyond Silicon Valley. While Nvidia and hyperscalers including Alphabet have captured many of the headlines, Goldman, JPMorgan and other banks are profiting from the massive flows of capital into AI.

They are advising on AI-related deals, financing data centers and power infrastructure, underwriting debt and equity offerings, and facilitating the surge in trading that has accompanied the global race to deploy the technology.

That is creating “a ripple effect” across the American economy and giving banks a flood of new opportunities to provide financing and trading solutions across public and private markets, Goldman CEO David Solomon told analysts Tuesday.

“We are in the middle of an AI capex super cycle where there are demands on financing in every single financing instrument, in every region of the world and across every single industry,” Solomon said. Capex is short for capital expenditures, or investments made by a business for physical assets like factories.

Goldman is preparing for a three-to-five year investment cycle that is still in its early stages, he told analysts.

Goldman shares jumped 8% in afternoon trading, while JPMorgan rose 2%.

The top beneficiaries of this trend are the three biggest Wall Street firms: Goldman Sachs, JPMorgan and Morgan Stanley, according to Wells Fargo banking analyst Mike Mayo.

The AI investment boom “reached a tipping point” in the second quarter, Mayo said.

Mayo increased his price targets for Goldman and JPMorgan after Tuesday’s blowout results. Morgan Stanley is scheduled to report earnings on Wednesday.

The clearest evidence of the AI impact appeared in equities trading, where global capital flows and blockbuster transactions helped produce some of the biggest revenue surprises of the quarter.

Revenue from equities trading rose 86% to $6 billion at JPMorgan and 72% to $7.42 billion at Goldman. Combined, that was a whopping $4.4 billon more than analysts had expected.

Other large banks also benefited. Bank of America, the second biggest U.S. lender by assets, saw equity trading revenue rise 70% to $3.6 billion.

Helping the quarter, investors broadened out their search for AI beneficiaries, pouring money into Asian markets, including South Korea, Taiwan and Japan, Soofian Zuberi, president and co-head of Global Markets at Bank of America, told CNBC.

“People looked at the AI trade and said, ‘What are the best reflections of it outside the U.S?,'” Zuberi said. “You’ve got American clients who are diversifying and allocating more money to Asia, including foundations, the endowments, and family offices.”

In the quarter, Goldman was lead advisor on the SpaceX IPO and Alphabet’s $90 billion equity issuance and advised Dominion Energy on its sale to NextEra Energy, all moves driven by the AI cycle.

At Bank of America, investment banking fees jumped 50% to $2.1 billion.

At the same time as they reap record fees driven by AI, banks are starting to benefit from implementing the technology internally. That should help them increase revenue while keeping a lid on headcount and other expenses.

“AI is driving banking by helping streamline processes,” Zubieri said. “And banking is driving AI, because without banking you can’t have all these data centers financed.”