Siemens Energy Soars in Q2 - Riding High on a Billion-Euro Profit Forecast
The New and Improved Siemens Energy
Siemens Energy Outperforming in Recent Quarters, registering Significant Growth - Siemens Energy's Q4 Shines Bright: Steady Climb Continues
After weathering the storms of the past, Siemens Energy is gearing up for a profitable year. The company just reported a tax-adjusted profit of 501 million euros in the most recent quarter — that's almost five times higher than the previous year! While subsidiary Siemens Gamesa still poses a challenge, other sectors are shining bright, causing the company to boost its earnings prediction significantly. Even the US tariffs are causing only minor hiccups.
"A nuisance, but manageable" sums up CEO Christian Bruch's view of the impact of the tariffs. The company estimates the burden in the remaining two quarters to be in the high-double digits million-euro range. Compared to the figures recently quoted by German automakers, this is fairly low. The negative effects are more than surmounted by the strong growth.
Revenue and Order Boom
The second quarter saw a 20% increase in revenue, hitting nearly €10 billion, and orders skyrocketing to over €14.4 billion. Bruch calls it an "order boom," crediting the increase in electricity demand for the uptick. He recently raised the forecast from a break-even point to a potential €1 billion profit, saying, "Our confidence in the sustained market opportunities, as well as our excellent project execution, reflects the improved outlook."
The Troubles at Gamesa
However, the issues at Gamesa aren't entirely in the past. In the second quarter, Gamesa continued to post significant losses in its segment, but strong numbers in turbine and maintenance businesses, along with power grid technology, helped offset these losses. Despite ongoing problems with two crucial onshore wind turbine models, the company anticipates reaching the break-even point next year. If other sectors maintain their current performance, Siemens Energy could reach new financial heights.
Aiming for the End of Guarantees - But No Dividend Yet
Despite the positive financial outlook, shareholders won't receive a dividend for the current fiscal year. Bruch explains that this is due to the state guarantees the company received two years ago, which secured the entire order book. While the company projects shedding these guarantees during the fiscal year, as CFO Maria Ferraro explains, the dividend will only be possible for profits earned in the following year, potentially as early as 2027.
Still, shareholders could celebrate on Thursday, as Siemens Energy ranked among the biggest winners on the stock exchange in the morning.
Insights
- Siemens Energy's revenues increased by 20% in Q2 2025, reaching nearly €10 billion.
- Orders skyrocketed by 52.3% to €14.4 billion, contributing to a record order backlog of €133 billion.
- The company expects a profit margin between 4% and 6% for fiscal year 2025.
- Siemens Gamesa's problems with certain onshore wind turbine models persist, but the company anticipates reaching break-even point next year.
- Shareholders won't receive a dividend for the current fiscal year due to state guarantees received two years ago.
Related Topics
- Christian Bruch (CEO of Siemens Energy)
- Munich (Location of Siemens AG headquarters)
- Siemens AG (Parent company of Siemens Energy)
- Siemens Gamesa (Subsidiary of Siemens Energy)
- Community aid is being considered for Siemens Energy amidst the sustained market opportunities and significantly increased profits, as the company works towards shedding the state guarantees received two years ago.
- In an effort to further boost profits, Siemens Energy is looking towards renewable energy technology, with a particular focus on wind power, aiming to counterbalance the issues at Siemens Gamesa and the minor impacts of US tariffs.
- The robust outlook for Siemens Energy extends beyond electricity demand and profit expectations, with the company also exploring the restructuring of the steel industry to further diversify its portfolio and secure its position as a leading global industrial player.
