Siemens Energy (LON:0SEA) reported record fiscal 2026 revenue and net income, expanded its share buyback program and set higher profitability targets through 2030 as demand for power equipment boosted its order backlog.
The company, which plans to adopt the Omterra name, reported revenue of EUR 44 billion, up 15%, and net income of EUR 4.129 billion. Orders rose about 18% to more than EUR 68 billion, while the backlog reached EUR 164 billion.
Profit margin before special items rose to 12.4%, more than double the prior-year level, and pre-tax free cash flow reached EUR 8.8 billion. The wind business, Siemens Gamesa, broke even for the year after two consecutive profitable quarters, Chief Financial Officer Maria Ferraro said.
“We met or we exceeded our targets,” Chief Executive Officer Christian Bruch said, adding that the company plans to expand capacity and increase margins in the coming years.
Higher targets and shareholder returns
For fiscal 2027, Siemens Energy expects comparable revenue growth and a profit margin before special items of 14% to 16% each. It forecasts net income of about EUR 5 billion and free cash flow of EUR 10 billion.
By 2030, the company is targeting annual revenue growth of 12% to 14% and a profit margin before special items of 20% to 22%. Gas Services and Grid Technologies are expected to be the largest contributors, with respective margin targets of 25% to 27% and 24% to 26%.
Ferraro said about 85% of the revenue expected for fiscal 2027 was already represented in the order backlog. She said the backlog provided visibility into later years, although that percentage declines further out.
The company also expanded its share buyback authorization by up to EUR 9 billion, bringing the total program to as much as EUR 15 billion. Siemens Energy repurchased EUR 3.1 billion of shares in fiscal 2026 and will propose a dividend of EUR 2.30 per share at its 2027 annual meeting, up from EUR 0.70 the previous year.
Ferraro said the company anticipates approximately EUR 25 billion in shareholder returns from buybacks and dividends through 2030. It also expects capital spending to average about EUR 2 billion a year over that period.
Gas and grid growth; wind risks remain
Gas Services orders rose 46% and revenue increased 20% in fiscal 2026, Ferraro said. Grid Technologies revenue grew 26%, while its orders increased 15%. Siemens Gamesa posted a 0.1% profit margin and 7% revenue growth, although its free cash flow remained negative. The company expects the wind business to generate positive free cash flow in fiscal 2028.
Bruch attributed the wind turnaround to cost reductions, improvements in turbine quality and availability, stronger service margins and higher factory productivity. Siemens Energy is targeting a Siemens Gamesa margin of 8% to 10% in 2030.
Bruch nevertheless cautioned that offshore wind projects need final investment decisions to prevent gaps in factory and supply-chain workloads after 2028. He said he expects offshore orders to increase in 2027 but called for faster action on projects in Germany, including clarity on grid-connection risks.
Asked about U.S. data-center demand following the midterm elections, Bruch said he saw no negative effect on Siemens Energy’s orders. The company has EUR 15 billion of data-center-related gas and grid business in its backlog, just under 10% of its total backlog, he said.
Industrial business separation and rebranding
Siemens Energy is working to make its Transformation of Industry business operationally and legally independent and hopes to begin talks with potential investors by spring 2027. Bruch said full functional independence was unlikely before 2028.
The company’s strategic aim is to sell a majority stake while retaining a significant minority interest. Bruch said a stake of around 40% could be appropriate, though no final decision has been made. Financial and strategic investors are possible, he said, and an initial public offering has not been ruled out. The business employs about 17,000 people.
Bruch said the company also plans to bring Siemens Energy and Siemens Gamesa together under the Omterra brand because it cannot use the Siemens name beyond 2030. The change will be introduced gradually and could take about 1.5 years to complete, he said.
About Siemens Energy (LON:0SEA)
Siemens Energy AG operates as an energy technology company worldwide. It operates through Gas Services, Grid Technologies, Transformation of Industry, and Siemens Gamesa segments. The company provides gas and steam turbines, generators, and heat pumps, as well as performance enhancement, maintenance, customer training, and professional consulting services for central and distributed power generation; and high voltage direct current transmission systems, offshore windfarm grid connections, transformers, flexible alternating current transmission systems, high voltage substations, air and gas-insulated switchgears, digital grid solutions and components, and storage solutions.
