Siemens Energy Sets €4 Billion Profit Target as Record Orders and Gamesa Turnaround Converge

Siemens Energy boosts 2026 net profit target to €4 billion, driven by record orders in grid tech and US data center demand, plus Gamesa turnaround. Stock up 44%.

Siemens Energy has sharpened its financial sights for 2026, now targeting a net profit of around €4 billion — a figure that previously sat at the lower end of its forecast range. The upward revision comes as the industrial group rides a wave of demand for grid infrastructure and data center equipment, while its long-troubled wind turbine subsidiary Gamesa shows genuine signs of recovery.

The order book is arguably the strongest it has ever been. In the second fiscal quarter alone, Siemens Energy booked €17.75 billion in new orders, easily beating analyst expectations. That followed a first-quarter intake of nearly €18 billion, meaning the company has amassed roughly €36 billion in fresh business over the past six months. The total order backlog now stands at a colossal €154 billion, securing production capacity well into the next decade.

US data center boom fuels grid business

The primary engine of this growth is the Grid Technologies division, where orders surged 41% year-on-year. The US market has been particularly explosive: orders from America nearly doubled to close to €7 billion as utilities rush to expand transformer production and reinforce aging power networks. The explosion in demand from data centers — themselves driven by the artificial intelligence arms race — shows no signs of abating.

Grid Technologies now boasts margins above 17%, making it the group’s most profitable segment. Management expects this strength to persist as electrification and digitalization push global electricity consumption higher.

Gamesa’s loss narrows sharply

Perhaps the bigger surprise came from Gamesa, the wind power subsidiary that had been bleeding cash for years. In the second quarter, its operating loss before special items shrank to €44 million from nearly €250 million in the same period a year earlier. The corresponding margin improved from minus 9.2% to minus 1.7%, driven by productivity gains and tighter cost controls.

While Gamesa is not yet profitable, the trajectory has given investors confidence that breakeven is within reach. The company continues to insist it will hit that milestone, even as offshore wind margins remain under pressure.

Analysts lift targets, buyback accelerates

The robust performance has prompted a flurry of target upgrades. Goldman Sachs, Deutsche Bank and Berenberg all raised their price objectives, with the highest now set at €212. JPMorgan sees fair value at €200, citing sustainably better margins in gas and grid operations. Not everyone is convinced: Morningstar warns that the record order intake may normalize, advising caution on valuation.

For now, the bulls are in control. The stock has climbed over 44% since the start of the year and touched €181.84 in recent trading, within striking distance of its 52-week high.

Adding to the positive sentiment, Siemens Energy plans to funnel up to an additional €1 billion into share buybacks this fiscal year, funded by strong operating cash flows. That sits alongside the existing €6 billion buyback program running through 2028. Analysts also expect a sharp jump in the dividend, forecasting around €1.84 per share for the current year — more than double the previous payout.

The next quarterly update is scheduled for August 5, with medium-term targets for the next decade due in the autumn. Given the weight of orders already in hand, the company enters that period with more visibility than it has had in years.