Siemens Energy’s Record Order Book Signals a New Era, but Gamesa’s Shadow Lingers

Siemens Energy posts record €17.8B orders as AI fuels grid infrastructure boom, raises guidance, and doubles free cash flow forecast despite revenue miss.

The artificial intelligence revolution is reshaping the global energy landscape, and Siemens Energy is cashing in. The Munich-based industrial giant has ridden the wave of AI-driven electricity demand to a record-breaking quarter, with orders surging to nearly €17.8 billion. Yet beneath the headline numbers, the company’s recovery story remains a tale of two halves.

Grid Technologies Steals the Show

The standout performer was the Grid Technologies division, which saw orders jump 41% year-on-year. The culprit? Hyperscalers and network operators scrambling to build out the infrastructure needed to power AI data centers. These facilities accounted for roughly a quarter of total demand in the previous quarter, and the trend shows no signs of slowing.

The boom has prompted management to raise its full-year guidance. Siemens Energy now expects revenue growth of between 14% and 16%, up from earlier forecasts. Net profit is projected to hit around €4 billion, while the Grid Technologies unit alone is targeting revenue growth of up to 27% and an adjusted operating margin of roughly 20%.

Cash Flow Surprise Lifts Sentiment

Beyond the order book, the company delivered a pleasant surprise on cash generation. Free cash flow before taxes is now expected to reach approximately €8 billion for the full year—double the original plan. This metric caught the attention of analysts, with RBC’s Colin Moody pointing to the “strong cash generation” and an ongoing supercycle in energy infrastructure. RBC maintains an “Outperform” rating with a €200 price target.

Goldman Sachs and Berenberg are also bullish, with targets of €185 and €195 respectively. Not everyone is convinced, however. Mwb research rates the stock a “Sell” with a €100 target, arguing that much of the good news is already priced in.

The Revenue Miss That Didn’t Matter

For all the optimism, the quarter was not without blemishes. Revenue climbed to just under €10.3 billion, missing market expectations by half a billion euros. Net profit of €835 million also fell slightly short of analyst estimates. Currency headwinds took some of the shine off the bottom line.

Yet the market shrugged off the disappointment. The shares have surged 51% since the start of the year and recently touched a 52-week high of €188. They currently trade around €187, just off the record peak set last Friday. Over the past 12 months, the stock has more than doubled, gaining roughly 172%.

Gamesa’s Slow Healing

The wind power subsidiary Siemens Gamesa remains the company’s biggest headache—and its most closely watched turnaround story. Losses at the division narrowed sharply to €44 million in the latest quarter, compared with a €249 million loss a year earlier. The unit is still targeting breakeven for the full year.

A €6 billion share buyback program, running through the end of 2028, is providing additional support. So far, the company has repurchased nearly 9.5 million shares on the open market.

What Comes Next

All eyes now turn to May 12, 2026, when Siemens Energy publishes its full half-year report. Investors will be looking for detailed margin trends in the grid business and, crucially, a clearer roadmap for Gamesa’s restructuring. The question hanging over the stock is whether the wind division can finally shed its reputation as the group’s weak link—or whether its recovery will remain a work in progress.