Siemens Energy Eyes Industrial Spin-Off as US Data Center Orders Top €2 Billion

Siemens Energy reviews spin-off of its Transformation of Industry unit to close valuation gap, as grid tech orders from US data centers nearly double in H1, driving stock up 3.62%.

The strategic calculus at Siemens Energy is shifting. A potential spin-off of its “Transformation of Industry” unit — which bundles compressors and steam turbines — is now under active review by management, opening a fresh avenue for the company to close the valuation gap with pure-play infrastructure peers. The news emerged on the heels of a pre-close call for the third quarter of fiscal 2026, where the group laid out a barrage of encouraging signals that sent the stock 3.62% higher to €165.80 on Tuesday.

The core of the bull case lies in the grid technology division. Siemens Energy disclosed that it booked roughly €2 billion in orders from US data center projects during the first half of the fiscal year — a sum that nearly matches the entire volume recorded in all of fiscal 2025. The company’s data center portfolio covers power transformers, circuit breakers, STATCOMs and grid connection solutions, all of which are becoming critical components not just for energy generation but for the broader AI infrastructure buildout. To meet demand, Siemens Energy plans to expand capacity for large power transformers and switchgear by 50% by 2030, with brownfield extensions in Austria, Italy, China and Saudi Arabia expected to deliver initial impacts in the second half of this year. Those product lines accounted for 45% of grid revenues in 2025.

Not every division is firing on all cylinders. Siemens Gamesa, the wind power subsidiary, saw major offshore orders slip into fiscal 2027, leaving the third quarter to be carried primarily by US onshore repowering contracts. The well-known profit pattern persists — a negative first half, a positive second half, and breakeven for the full year — while cash flow from the wind unit is not expected to turn positive until 2028. The gas services and grid technologies segments, by contrast, are running ahead of expectations. Bernstein analyst Alasdair Leslie noted after the call that order intake in both divisions could beat consensus forecasts; his firm maintains an “Outperform” rating with a price target of €210. Bank of America estimates group-wide orders of €17.6 billion for the third quarter, roughly 4% above the consensus figure.

Management also downplayed risks from the Middle East conflict, saying logistics and timing have been affected but not the underlying demand. The spin-off talk, meanwhile, adds a structural catalyst. By separating the industrial unit, Siemens Energy would sharpen its focus on network infrastructure and gas technology — arguably where the market assigns the highest multiples. The idea is to unlock hidden value that has been obscured by the conglomerate structure.

The stock has risen 35% since the start of the year, yet at €165.80 it still sits about 15% below its 52-week high of €195.54 reached in April. The 50-day moving average of €168.40 lies just above the current price, a level that has acted as resistance in recent sessions. A consolidation phase after a 63% gain over 12 months is hardly surprising. What matters next is the hard data due on August 5, when Siemens Energy publishes its Q3 results and holds a webcast at 10:00 am MESZ. The market will then judge whether the pre-close narrative — booming data center orders, capacity expansion, improved margin trajectory — is actually reflected in the numbers. If it is, the spin-off discussion could gain significant momentum.