Siemens Energy Reaffirms Full-Year Outlook Amid Stable Operations

In a final update to investors before entering its quiet period, Siemens Energy has reiterated confidence in its annual targets. The confirmation came during a pre-close briefing for the second quarter, with management underscoring its commitment to the stated course despite geopolitical tensions and ongoing restructuring within its wind power division.

Stable Demand and Supply Chain Resilience

Notably, the company reported no significant disruptions to its supply chains or customer demand, even against the backdrop of persistent instability in the Middle East. Operational performance across the business remains steady, providing a solid foundation for the year.

Currency Movements Amplify Growth Metrics

A key financial highlight for the upcoming quarter involves foreign exchange effects. The volatility between the US dollar and the euro is projected to add approximately 600 basis points to the group's comparable revenue growth, lifting it well above the nominal rate. This follows a similar 460-basis-point boost in the first quarter. Capital expenditure plans for the full year are unchanged at around €2.5 billion. However, spending is expected to accelerate significantly in the coming months after a subdued first quarter outlay of €347 million.

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Wind Unit's Path to Breakeven

The turnaround plan for the Siemens Gamesa Renewable Energy unit remains on track, with the overarching goal of reaching breakeven by the full 2026 fiscal year. Management anticipates a loss for the first half of the current year, banking on a substantially stronger second half to initiate the recovery. In the offshore segment, however, order intake is expected to be muted due to the postponement of several major auctions.

Share Performance and Shareholder Support

Siemens Energy's share price has retreated roughly 17% from its late-February peak of €169.20, trading below its 50-day moving average. A share buyback program initiated in early March, with a volume of up to €2 billion, is providing underlying support for the equity. In February, analysts at JPMorgan set a price target of €200 per share, citing robust momentum in the grid business.

The company's silent period is now in effect. Official second-quarter results are scheduled for release on May 12, which will offer a clearer view on the progress of the planned investment acceleration and the Siemens Gamesa restructuring.

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