Siemens Energy’s Record Order Intake and Profit Surge Raise the Stakes for Gamesa’s Return to Profitability

Siemens Energy earnings doubled, orders hit record €17.7B, but 2026 outlook hinges on Gamesa break-even. Stock up 43%; activist seeks spin-off.

Siemens Energy has delivered a first half that would make most industrial conglomerates envious — a doubling of earnings per share, a record order intake of €17.7 billion, and net income hitting €1.443 billion. Yet the company’s raised outlook for the 2026 fiscal year comes with an explicit catch: the wind turbine subsidiary Siemens Gamesa must finally reach break-even by year-end.

The shares have already rewarded investors handsomely, climbing about 43% year-to-date to trade around €175.50. That puts them comfortably above the 200-day moving average of €131 and within 7% of the 52-week high of €188. But the stock’s next leg higher depends entirely on whether management can make good on what is arguably the most critical turnaround in European renewable energy.

Orders surge, backlog swells — but Gamesa is the linchpin

Comparable order intake jumped nearly 30% to €17.7 billion, a new record, lifting the total order backlog to an eye-popping €154 billion. The United States was the standout market, with orders more than doubling compared to the prior-year quarter. Grid Technologies, the most profitable division with margins above 17%, continues to benefit from the global electrification and digitalization push.

The board used the momentum to lift its guidance for comparable revenue growth from 11–13% to 14–16%, while the pre-exceptional profit margin target was raised to 10–12%. Free cash flow before taxes is now expected to reach around €8 billion, double the previous range. A share buyback programme launched in March has already retired more than 12 million shares, further boosting per-share metrics.

But the fine print is unequivocal: these upgraded targets hinge on Siemens Gamesa swinging to profitability by the end of the calendar year. The division is still bleeding, though the haemorrhaging has slowed dramatically. Gamesa posted a quarterly loss of €44 million versus €249 million a year ago, and its margin improved from –9.2% to –1.7%. Management expects the offshore wind business to deliver the turnaround in the second half of the year. If it does not, the entire group’s outlook could unravel.

Analysts respond, activist pushes for divorce

The Street has taken notice. Jefferies lifted its price target from €164 to €215 with a Buy rating, citing order intake and gas turbine performance that again topped expectations. JPMorgan followed suit, raising its target to €225 and keeping an Overweight stance. Among 25 analyst ratings, the consensus sits at €169, with 19 recommending purchase.

Not everyone is content to wait for Gamesa’s recovery. Activist investor Ananym Capital is calling for a spin-off of the wind unit, arguing that persistent losses depress the valuation of the otherwise flourishing core operations. Whether that campaign gains traction will depend heavily on how convincingly Gamesa hits its break-even milestone in the coming months.

Offshore wind politics cast a shadow

Even as Siemens Energy’s core grid and transmission business hums along, the broader offshore wind landscape in Germany is clouded by policy uncertainties. At the energy ministers’ conference on Norderney, Lower Saxony’s energy minister Christian Meyer warned that TotalEnergies and BP could pull out of German offshore wind projects, representing potential investments in the double-digit billions. Germany currently has about 10 gigawatts of installed offshore wind capacity, far short of the 30 GW target by 2030 that experts now consider nearly unattainable.

Siemens Energy’s own offshore wind exposure through Gamesa makes this backdrop particularly delicate. Any slowdown in German project development could delay the very volume needed to sustain the division’s recovery.

Network infrastructure provides a buffer

The company’s grid and transmission business, however, remains a steady counterweight. E.ON invested €1.4 billion in the first quarter alone, with €1.1 billion channelled into energy networks. Transmission operator Amprion is pushing ahead with a 155-kilometre cable route into the Emsland region designed to connect future offshore capacity. That pipeline of projects ensures demand for Siemens Energy’s grid technology will remain robust regardless of the pace of offshore expansion.

Investors will get their next hard look at progress on August 5, when the company reports third-quarter results. By then, the market will be watching closely to see whether Gamesa’s loss reduction continues and whether the rest of the order book can keep the growth engine firing. The numbers so far are stellar — but the asterisk next to the guidance is the biggest in the room.