Siemens Shares Navigate Restructuring Amid Market Headwinds

Siemens posts strong Q1 results and record €120B backlog, but shares trade below key average amid EU tariffs and a major strategic overhaul to dissolve divisions.

Despite posting robust quarterly figures and achieving a record order backlog, Siemens AG's stock continues to trade significantly below its 200-day moving average. The industrial conglomerate is in the midst of a profound strategic overhaul, which will be showcased for the first time under a new leadership structure at the Hannover Messe trade fair starting April 20.

A Solid Operational Foundation Meets External Challenges

The company's operational performance remains strong. For the first quarter of 2026, Siemens reported a 15% increase in industrial profit, reaching €2.9 billion. Comparable order intake grew by 10% to €21.4 billion. Notably, the Digital Industries segment surged by 37%, a jump largely fueled by data center deals valued at €1.8 billion. The total order backlog hit an all-time high of €120 billion. Management has raised its full-year guidance, now forecasting earnings per share in a range of €10.70 to €11.10.

However, this positive picture is clouded by a difficult trading environment. An agreement between the EU and the US government has established a 15% tariff rate on EU exports, a move that could create an additional financial burden of up to €500 million for Siemens. The company is also facing headwinds from currency fluctuations and a broader correction in the German DAX index. Currently trading around €214, the share price sits well below its 200-day average of €235.

Strategic Shift: Dissolving Major Divisions

Internally, preparations are underway for a significant structural change. According to a report by Handelsblatt, Siemens is planning to dissolve its Digital Industries and Smart Infrastructure divisions as part of its "One Tech Company" strategy. These would be replaced by six or seven smaller, more focused business areas. These new units would report directly to the managing board, eliminating previous intermediate management layers.

The objectives of this move are to dismantle duplicate structures, strengthen the software business, and accelerate the integration of physical and digital infrastructure. The Mobility division is expected to remain unaffected. CEO Roland Busch is anticipated to discuss the plan with the supervisory board and employee representatives in May, though a final decision has not yet been made. Siemens has declined to comment on the media report.

This restructuring coincides with a streamlined executive board, which has been reduced from seven to five members following the departures of CFO Ralf Thomas and Smart Infrastructure CEO Matthias Rebellius.

Upcoming Events: A Crucial Dual Test

The Hannover Messe, beginning April 20, will serve as the first public benchmark for Siemens's new direction. Board member Cedrik Neike will present how the company intends to deploy its industrial AI solutions—from digital twins to autonomous workflows—across the entire value chain. Significantly, Siemens will exhibit in Hall 27, a newly created area dedicated to industrial AI applications.

The true stress test, however, will come with the release of the second-quarter results on May 13. These figures will reveal the precise impact of the new tariff regime on margins and indicate whether the record order backlog can be sustained under altered trade conditions. With a price-to-earnings ratio of approximately 20.9, which already exceeds the industry average of 17.6, the market is likely to offer little tolerance for disappointing news.