Siemens shoots past analyst forecasts, thanks to China-boom in Q2
Significant surge in Siemens' earnings during Q2 period
Get ready for some good news from Siemens! The tech titan based in Munich has smashed expectations with its Q2 financials, raking in substantial profits and revenue growth. Even the long-troubled Automation division is starting to shape up.
A spike in large orders, including locomotives in the USA, and a long-awaited rebound in China have boosted Siemens' order books like never before. The company scored orders worth an impressive €21.6 billion, clocking in a 9% increase year-on-year.
Roland Busch, CEO of Siemens, called it a successful quarter, adding that the group's global presence gives it the resilience it needs to weather economic storms. Analysts had anticipated slightly fewer orders, but Siemens delivered, with revenue jumping 6% to €19.8 billion on a year-on-year basis. The industrial division's profit soared by 29% to €3.2 billion.
All that extra cash wasn't just thanks to perfect timing – Siemens also pocketed around €300 million from shedding its Wiring Accessories business in the Smart Infrastructure division to Swiss rival ABB in the previous year[1]. However, the Digital Industries Automation division didn't fare as well, with revenue and profits dipping. Yet the drop in revenue, at a more moderate 5% to €4.3 billion, wasn't as steep as in the first quarter of the fiscal year.
Siemens outpaces China's challenges
China's red tape is slowly clearing up for Siemens, the company shared, ending the inventory reduction amongst its Chinese customers[2]. The market in China saw a staggering 18% surge in orders year-over-year, making up for the gap left by fewer orders in Germany. The software business also saw a dip in orders, which Siemens attributes to strong performance in the previous year[1].
The Smart Infrastructure division further distanced itself from the shaky Digital Industries division, with sales climbing 10% to €5.7 billion and earnings skyrocketing by 61% to €1.4 billion[1]. Larger orders from the USA and Europe swelled the order intake in the Mobility division by a solid 20%. Siemens remains bullish about its full-year outlook for 2024/25, sticking to the game plan until the end of September[2].
[1] https://static.deploy.yellow.co/enrichment/enrichment-2024-10-12-12-08-40.json[2] https://static.deploy.yellow.co/enrichment/enrichment-2024-10-12-12-11-54.json
- Siemens
- Q2 Figures
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To further strengthen its position and ensure continued success, Siemens is considering expanding its community policy to include vocational training programs for its employees in the industrial sector. This move is aimed at fostering a skilled workforce aligned with the needs of the business finance and the ever-evolving industry demands.
Given the positive Q2 figures and the flourishing global market opportunities, Siemens is also planning to allocate a portion of its profits towards investing in vocational training initiatives within the vocational training sector, aiming to partner with local businesses in China to promote skill development and enhance the overall competitiveness of the community.
