AWS Deal and AI Boom Propel Siemens Energy to Record Orders, but Revenue Miss Clouds the Picture

Siemens Energy posts record orders of €17.75B, boosted by AI data center demand and grid tech, but revenue miss and wind unit woes keep stock under pressure.

Siemens Energy delivered what on paper looks like a blockbuster quarter: record orders of €17.75 billion, a sharply upgraded cash flow target, and a new strategic partnership with Amazon Web Services. Yet the market's reaction has been muted, and the stock remains under pressure from a rare revenue shortfall and persistent headwinds at its wind turbine division.

The company's grid technology arm is emerging as the clear engine of growth, fueled by surging demand from data centres and artificial intelligence infrastructure. Siemens Energy announced it has deepened its collaboration with AWS, naming the tech giant its strategic cloud provider while supplying substation equipment for Amazon's own data centres. Chief executive Christian Bruch highlighted AI-driven electricity needs as a key catalyst, noting that roughly one in four gas turbines sold now serves data centre power supply.

Grid Technologies posted order intake of €7 billion in the quarter, a 41.5% jump year-on-year, and its total order backlog swelled to €49 billion. A high-voltage direct current project in the Baltic Sea worth over €1 billion and rising transformer demand from the United States underpinned the strength. Bruch said the company expects to boost transformer and switchgear capacity by around 50% by 2030. Across the group, the US market was particularly robust, with orders doubling compared with the same period last year.

That momentum pushed group order intake to €17.75 billion, roughly 13% above the analyst consensus of €15.64 billion. The book-to-bill ratio stood at 1.72, and the total order backlog reached €154 billion. The strong inflow of customer advances lifted free cash flow before taxes to €2 billion in the quarter alone, or €4.8 billion for the first half. That gave management confidence to raise its full-year free cash flow forecast to around €8 billion, up sharply from a previous range of €4 billion to €5 billion.

Net profit more than doubled to €835 million from €501 million a year earlier, pushing earnings per share to €0.89 from €0.50. The company now expects comparable revenue growth of 14% to 16% for the full year, up from 11% to 13%, and an operating margin before special items of 10% to 12%. Net profit is seen at roughly €4 billion.

Yet the stock has struggled to hold gains. Shares traded at around €174 on Wednesday, up 1.6% on the day but still down about 6% on the week and roughly 9% below the all-time high set in April. The reason: revenue fell short of expectations. Group sales rose 8.9% on a comparable basis to €10.29 billion, missing the consensus estimate of €10.84 billion. A weak US dollar clipped about 550 basis points from the top line, a headwind that chief financial officer Maria Ferraro attributed to currency translation effects rather than any loss of underlying demand.

The other drag remains Siemens Gamesa. The wind power unit narrowed its quarterly loss to €46 million from much higher levels a year ago, but management expects the division to stay in the red for the first half. The restructuring programme is progressing — onshore manufacturing will be consolidated into four sites by 2026 — but offshore performance still needs to improve. Bruch has set a group margin target of 14% to 16% by 2028, a goal that hinges on both the grid tailwind continuing and Gamesa finally turning the corner.

Despite the near-term caution, the medium-term visibility offers reassurance. Ferraro noted that roughly 93% of the second half of 2026 is already covered by the order backlog, and coverage for fiscal 2027 stands just below 80%. New medium-term targets for 2030 are expected alongside the annual results in November. For now, Siemens Energy is riding a wave of electrification and AI demand — but the market is watching closely for proof that the story can extend beyond the grid.