Siemens Aktiengesellschaft (ETR:SIE) kicked off fiscal 2026 with robust performance, reporting substantial increases in orders and revenue growth across multiple sectors. The company’s results reflect a strong demand, particularly in its Smart Infrastructure division, which has been bolstered by an unprecedented surge in data center-related projects. Following the first quarter, management has raised its earnings-per-share outlook for the full fiscal year.
Record Orders and Backlog
CEO Roland Busch characterized the beginning of fiscal 2026 as a “strong start,” emphasizing the company’s focus on seizing opportunities despite ongoing geopolitical uncertainties. Siemens reported a book-to-bill ratio of 1.12, and its order backlog reached a record high of EUR 120 billion. The industrial business profit totaled EUR 2.9 billion, resulting in a profit margin of 15.6%. Busch noted that adverse currency translation effects reduced margins by approximately 60 basis points. The basic earnings per share before purchase price allocation (EPS pre PPA) stood at EUR 2.80, while free cash flow for the quarter was reported at EUR 0.7 billion, a seasonal decline following an exceptionally strong fourth quarter in fiscal 2025.
Smart Infrastructure Drives Growth
Chief Financial Officer Ralf Thomas highlighted the exceptional performance of the Smart Infrastructure segment, which saw orders rise by 22% to a record EUR 7.2 billion, with a book-to-bill ratio of 1.30. The order backlog for this unit reached an all-time high of EUR 20.2 billion, providing strong visibility for the remainder of fiscal 2026. Thomas attributed this surge largely to Electrification, with orders increasing by 38%, and Electrical Products, which saw a 22% rise. Notably, data center orders alone totaled a record EUR 1.8 billion, with significant contributions from larger contracts. Revenue in Smart Infrastructure also climbed by 10%, surpassing internal expectations, while the profit margin improved significantly to 19.0%, aided by commodity hedging benefits.
Regionally, Siemens experienced an impressive 54% growth in orders in the United States, primarily driven by demand from data centers and building projects. Looking ahead, Thomas expects Smart Infrastructure’s comparable revenue growth to fall within the upper half of its guidance range of 6%-9%, supported by the substantial backlog. He added that second-quarter margins should align with the full-year guidance of 18%-19%, influenced by commodity prices and foreign exchange fluctuations.
Digital Industries and Mobility Performance
The Digital Industries segment reported a 13% increase in orders, reaching EUR 4.8 billion, with a book-to-bill ratio of 1.07. While the automation business showed improvement for the third consecutive quarter, Thomas described the overall market dynamics as “gradually improving” but still with limited visibility. Revenue for Digital Industries rose by 10%, with software up 11% and automation up 9% to EUR 7.9 billion. The profit margin for this segment came in at 17.8%, exceeding expectations due to pricing and productivity improvements.
In the Mobility segment, orders totaled EUR 2.9 billion, with a book-to-bill ratio of 0.90. The order backlog remained strong at EUR 51 billion, which includes EUR 15 billion in service business. Revenue increased by 9%, driven by rolling stock and customer services, while the profit margin improved to 9%. Thomas expects cash flow to stabilize after the remarkable performance in the previous quarter.
Updated Financial Outlook
Siemens has adjusted its full-year guidance for basic EPS before PPA, now forecasting between EUR 10.70 and EUR 11.10, marking an increase of EUR 0.20 at the midpoint. Management indicated that operating working capital rose by approximately EUR 1.3 billion in the first quarter, reflecting expected seasonal patterns. The company also settled a longstanding legacy obligation related to nuclear waste removal in Hanau, Germany, costing around EUR 400 million.
Looking ahead, Siemens aims to maintain double-digit cash return on revenue levels in fiscal 2026. The company reported an industrial net debt-to-EBITDA ratio of 0.9 and continues to hold double-A ratings from both S&P and Moody’s. Additionally, Siemens plans to retire 18 million treasury shares in March, reducing its capital stock to 782 million shares.
In the Q&A session, Busch discussed ongoing efforts regarding the planned deconsolidation of Siemens Healthineers, indicating that further details will be shared in the spring. The recent sale of Siemens’ airport logistics business in the U.S. to Vanderlande was also described as a completed matter.
Siemens Aktiengesellschaft remains a key player in the global technology landscape, focusing on automation and digitalization across various regions, including Europe, the Americas, and Asia. With its diverse segments, the company continues to navigate challenges while capitalizing on growth opportunities in an evolving market.
