Siemens Energy Hikes 2025 Guidance After Record Orders, Shrinking Wind Losses, and a Landmark Cable Project

Siemens Energy is giving the market two clear signals that its transformation is on track: a sharp earnings beat that prompted an upgrade to full-year forecasts, and the final delivery of 14 massive transformers for the NeuConnect power link between Germany and Britain. The combination of operational momentum and project execution helps justify a share price that has more than doubled over the past twelve months.

For the second fiscal quarter, the energy technology group posted order intake of €17.749 billion, a comparable increase of 29.5 percent. Revenue rose to €10.294 billion. More tellingly, operating profit before special items jumped to €1.159 billion from €481 million a year earlier, while net income came in at €835 million. Free cash flow before taxes reached €1.975 billion, restoring the financial flexibility that had been constrained by prior problems at the wind turbine subsidiary Siemens Gamesa.

That subsidiary is finally showing signs of recovery. Gamesa cut its operating loss to €44 million, compared with €249 million in the same quarter last year. Management continues to target an operational break-even in the second half of the fiscal year, a goal that now looks more achievable given the narrowing deficit.

The grid business remains a powerful growth engine. Grid Technologies saw order intake surge 41.5 percent to €6.996 billion, fueled by the global push to expand and modernise electricity networks. Gas Services also contributed strongly, converting more than 12 gigawatts of reservations into firm orders. The structural demand from data centres, which the International Energy Agency expects to consume 950 terawatt-hours by 2030, underpins the long-term need for both gas turbines and grid equipment.

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Beyond the numbers, Siemens Energy underscored its execution capabilities with the completion of all transformer deliveries for NeuConnect. The last of the 14 units, each weighing 200 tonnes, arrived at the German converter station site in Wilhelmshaven. The project, designed to carry 1.4 gigawatts of electricity — enough to supply roughly 1.5 million homes — is scheduled for commissioning in 2028, and the majority of the subsea cable has already been laid.

The market’s reaction was measured. Shares closed Monday at €178.32, leaving the stock 5.15 percent below its all-time high and roughly ten percent above its 50-day moving average. Year-to-date the gain stands at 45.21 percent, while the 12-month advance is a staggering 135.06 percent. The relative strength index of 53.6 suggests the rally is not yet technically overstretched, but expectations are high.

Management is backing its confidence with concrete capital allocation. An annual dividend of €0.70 per share was announced in February for fiscal 2025, and a share buyback programme running through 2028 has already repurchased 11,616,675 shares. In the latest week alone, Siemens Energy bought 795,065 shares at weighted average prices between €179.01 and €185.67. The first tranche of the programme could amount to as much as €2 billion.

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The raised guidance now projects comparable revenue growth of 14 to 16 percent for the full fiscal year, up from the previous range of 11 to 13 percent. The margin before special items is expected to reach 10 to 12 percent, with net income targeting around €4 billion and free cash flow before taxes of roughly €8 billion.

With the Q2 report now published and the NeuConnect milestone achieved, the focus shifts to whether Siemens Energy can continue to deliver at this pace. The combination of a rapidly growing grid segment, a stabilising wind business, and a clear strategy for returning cash to shareholders provides multiple pillars of support — but the stock’s elevated valuation leaves no room for operational stumbles.

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