Siemens Energy (LON:0SEA) reported higher order intake and revenue in the third quarter of fiscal 2026, while profitability improved sharply and its wind business returned to a positive result for the first time in 15 quarters.
During a press call, moderator Tim Krolga said quarterly revenue reached €17.9 billion. Profit before special items was three times the prior-year level, while the corresponding margin rose to 14.2%. The company also said Siemens Energy and Siemens Gamesa would use the name Omterra as they prepare to transition to a standalone brand.
Middle East and data-center demand support orders
Bruch said the Middle East made a substantial contribution to demand during the quarter. Large projects in the region accounted for roughly 30% of ordered capacity in gigawatt terms, according to his estimate. Saudi Arabia, the United Arab Emirates, Oman and Qatar have historically been important markets, he said.
The regional conflict had not weakened demand, Bruch said. “Quite on the contrary,” he said, adding that discussions around building more resilient energy infrastructure could support future activity in the region.
Siemens Energy is also seeing demand from data centers, particularly for gas turbines. Bruch said data centers represented about 20% of gas-turbine orders by capacity during the quarter, somewhat below the prior quarter because the company is deliberately seeking a balanced order mix. He said the data-center market was important and likely durable, but was not as dominant as some market coverage suggests.
On capacity reservations, Bruch said the company was discussing arrangements equivalent to roughly 10% to 20% of revenue. Such payments are intended to function as down payments that would lapse if a customer does not ultimately purchase the turbine. He said the company was focused on developing balanced arrangements and long-term customer relationships rather than maximizing short-term gains.
Transformation of Industry review remains ongoing
Bruch addressed reports and investor questions regarding a potential carve-out of the Transformation of Industry business, stressing that no decision or timetable had been established.
He said Siemens Energy operates in two distinct areas: businesses linked to electricity, including gas services, wind and grid technologies, and the industrial-focused Transformation of Industry segment. Both areas are profitable, growing and competing for capital investments, he said.
“We are not doing this as seeing quick wins at the moment,” Bruch said of the portfolio discussions. The objective is to ensure the businesses can compete over the next three, five and 10 years, he added.
Bruch said Transformation of Industry is designed around industrial customers that may purchase compressors, steam turbines and electrification solutions. Keeping those activities together has “intrinsic value,” he said. He also said hydrogen remains important but that the market has not developed as expected several years ago, making the long-term structure and ownership of the business a subject for further discussion.
The company is speaking with supervisory bodies, employees, employee representatives and works councils, Bruch said. He described those exchanges as critical but constructive and said any process would proceed step by step rather than occur quickly.
Wind turnaround advances, but offshore pipeline needs attention
Siemens Energy’s wind unit posted a positive result in the quarter, a milestone Bruch credited to the work of the team. Across the first nine months, however, the business still recorded a small double-digit loss, he said. The company continues to expect the wind business to reach break-even in fiscal 2026, while cash-flow break-even is planned for 2028.
Bruch said offshore wind order intake has been affected by delayed projects, as developers weigh financing conditions and interest rates before making final investment decisions. Because offshore projects are often large, a single delay can materially affect quarterly order intake, he said.
The company has projects scheduled for delivery in 2027 and 2028, but Bruch said new offshore orders will be needed to support activity in 2029. He called on the German government to address auction and bidding conditions, arguing that 16 gigawatts of projects that had been auctioned were unlikely to be built under the current terms.
Onshore activity is beginning to recover after a slower ramp-up, he said. Siemens Energy’s SG 7.0 onshore turbine is in its launch phase, with sales volumes still relatively small as customer and approval processes continue. Bruch said customer feedback on the model had been positive.
Asked about potential consolidation among European wind manufacturers in response to Chinese competition, Bruch said the issue was ultimately a political and regulatory matter. He said European manufacturers could not match Chinese competitors’ asset costs, but added that combining all European wind companies would face antitrust obstacles.
Cash flow reflects orders and investment cycle
Bruch said free cash flow reflects the normal structure of Siemens Energy’s business, including order intake, revenue and project timing. He noted that capital expenditures are expected to be significant in the fourth quarter as the company continues investing in plants.
Siemens Energy reported free cash flow of €7.2 billion after nine months and maintained guidance of €8 billion for the full year. Bruch called the target “robust guidance,” citing the expected fourth-quarter investment spending.
The company’s €162 billion order backlog consists of firm orders and does not include capacity reservations, Bruch said. Siemens Energy prefers to convert demand into orders rather than accumulate an excessive level of reservations.
Looking ahead, Bruch said the company sees a continuing “super cycle” in electrification, supported by the growing share of electricity in overall energy demand. He cited operational improvements, market demand and ongoing portfolio adjustments as key contributors to the company’s performance.
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.
