Siemens Reports Strong Earnings, Despite Order Decline
Siemens reported strong earnings in its third fiscal quarter, exceeding analyst expectations despite a decline in orders. Operating profit increased by 11% to €3 billion, exceeding the consensus of €2.84 billion.
Highlights:
Demand for upgrades to electrical infrastructure and manufacturing software provided a boost.
Orders fell 15% year-over-year, impacted by a record order intake in the previous year.
Revenue growth and earnings in the key industrial unit fell short of forecasts due to factory utilization issues and high inventory levels.
The company maintained its full-year outlook despite challenges in the industrial automation business.
Market Response:
Siemens shares rose slightly in pre-market trading following the announcement.
Management Commentary:
“We grew profitably in the third quarter, continuing to benefit from high demand for electrification,” said CEO Roland Busch. “Another growth driver was our particularly strong industrial software business.”
Outlook:
Siemens reaffirmed its outlook for the fiscal year ending September, with revenue growth expected in the lower end of a 4% to 8% range. Margins for the Digital Industries division are expected to be at the lower end of guidance, while margins for the Smart Infrastructure division are expected to be at the higher end.