Siemens Energy reported a significant increase in its net profit for the first three months of its fiscal year, reaching €746 million, nearly tripling the €252 million from a year earlier and surpassing analyst expectations of €732 million. This growth is largely attributed to the surging demand for gas turbines and grid infrastructure, fueled by the global build-out of data centers to support AI technology. The company's CEO, Christian Bruch, highlighted the substantial contribution of sustained high demand in gas turbines and grid technologies to overall performance.
The company's struggling wind turbine division, Siemens Gamesa, also showed signs of improvement, narrowing its operating loss to €46 million, a significant reduction from €374 million in the same period last year. This improvement was aided by enhanced productivity and a focus on stabilizing its product portfolio. Siemens Gamesa is still targeted to break even by 2026, and its positive trajectory contributed to the overall optimism surrounding Siemens Energy's financial health. Analysts, including those from Deutsche Bank, noted that Siemens Energy "surprised on the upside" despite high expectations.
Siemens Energy's stock has seen a remarkable increase, rising more than tenfold over the past two years, boosting its market value to €137 billion. Following the positive earnings report, shares climbed 5.2% to a record high. The company's order intake also hit an all-time high of €17.7 billion in the first quarter, pushing its total backlog to a record €154 billion, significantly exceeding analyst forecasts. This strong order performance, particularly from the U.S. driven by data center expansion, led the company to raise its full-year guidance for 2026, expecting revenue growth between 14% and 16% and a net profit of around €4 billion. Siemens Energy now expects a Net income of around €4bn. Also, the outlook for Free cash flow pre tax for the fiscal year 2026 was raised to around €8bn. The company is also returning cash to shareholders through a share repurchase program, buying back over 11 million shares, and projecting a sharp increase in dividends for fiscal year 2026.
