Siemens lifts outlook on AI orders

Siemens raised its fiscal 2026 earnings outlook on Thursday after reporting record third-quarter orders and its highest-ever quarterly industrial profit, saying demand tied to artificial intelligence lifted both data-center infrastructure and industrial software. The German engineering group said orders rose 13% to 27.9 billion euros in the quarter ended June 30, revenue increased 7% to 20.8 billion euros and industrial profit climbed 25% to 3.52 billion euros. It lifted its full-year earnings-per-share outlook before purchase price allocation accounting to 11.20 euros to 11.50 euros, from 10.70 euros to 11.10 euros previously. ### Why did Siemens raise guidance this time? Siemens said on August 6 that strong first-nine-month performance allowed it to raise its fiscal 2026 EPS pre-PPA outlook while keeping expected comparable revenue growth for the group at 6% to 8% and a book-to-bill ratio above 1. The company described the quarter as a record period for both order intake and profit in its industrial businesses. (assets.new.siemens.com) Roland Busch, Siemens’ chief executive, said the company was seeing demand from data centers used for AI, as well as for AI-enabled software and equipment used to run factories and buildings. Reuters reported that Busch also cited improving sentiment from aerospace, defense and machine-building customers. ### Where did the AI-related demand show up in the numbers? (press.siemens.com) Smart Infrastructure was one of the clearest beneficiaries. Siemens said orders in that division rose sharply, and Reuters reported Busch said the company was working with nine of the 10 largest data-center providers, with orders up by a triple-digit percentage in the first nine months of fiscal 2026. (live.euronext.com) Digital Industries also contributed. Siemens’ earnings materials said profit in the quarter improved strongly, with the software business making the largest contribution. A summary of the earnings call said software ARR in Digital Industries grew 11% organically and that the integration of Altair and Dotmatics was progressing well, with early revenue synergies beginning to materialize. (assets.new.siemens.com) ### Why did the shares fall if the company lifted outlook? Siemens shares fell 5.2% in mid-morning trading on Thursday, according to Reuters, even after the guidance increase. That move came after the stock had gained nearly 20% since the start of the year through Wednesday’s close and had touched a record high of 291.50 euros during the session. (assets.new.siemens.com) Reuters said investors had been looking for more after a strong run in the shares and after the company beat third-quarter expectations on profit, revenue and orders. The market reaction left Siemens in the position of posting record quarterly figures while still missing the higher bar investors had set. ### What else stood out in the quarter besides guidance? (live.euronext.com) Free cash flow rose 42% to 4.1 billion euros in the quarter, and net income increased 15% to 2.6 billion euros, Siemens said in its earnings release. The company reported a book-to-bill ratio of 1.34, indicating orders outpaced revenue during the period. Veronika Bienert, Siemens’ chief financial officer, also said the company had received binding decisions from German tax authorities on issues related to Siemens Healthineers shares that it plans to distribute to investors. (live.euronext.com) Siemens said that cleared the way to proceed with the planned spin-off on a tax-free basis for shareholders. (assets.new.siemens.com) ### What should investors watch next? Fiscal 2026 runs through September for Siemens, and the company’s next scheduled checkpoint will be its fourth-quarter and full-year results later this year. Investors will also be watching whether AI-linked demand in Smart Infrastructure and software growth in Digital Industries hold up, and for further updates on the planned Siemens Healthineers spin-off that Bienert said can now proceed as planned. (press.siemens.com) (assets.new.siemens.com)