Siemens Lifts Mid-Term Targets After Record €108 Billion Orders

Siemens booked €108.2 billion in fiscal 2026 orders, a 25% comparable rise and a company record, and raised its mid-term growth targets on the back of it. The Munich group now expects comparable revenue growth of 7% to 11% a year over the medium term, up from 6% to 9%. The EPS target moves to double-digit growth before purchase price allocation, from high single digits. Both targets were announced Thursday alongside full-year results to Sept. 30.

Revenue grew 8% to €83.4 billion, at the top of guidance. The book-to-bill ratio stood at 1.30. Industrial Business profit, Siemens' preferred operating measure, rose 13% to a record €13.3 billion. Margin widened to 16.3% from 15.4%. Free cash flow reached a record €12.1 billion, and the boards propose a dividend of €5.50 per share, up from €5.35.

Net income tells a less flattering story. It fell 9% to €9.5 billion. Fiscal 2025 had included a €2.1 billion gain on the sale of Innomotics, which flattered the prior year. EPS pre PPA of €11.76 still beat the €11.20 to €11.50 range Siemens had set after its third quarter.

What drove the fourth quarter?

Orders surged 58% to a quarterly record €34.8 billion. Mobility's order intake more than quadrupled to €10.7 billion on large rail contracts, including a €2.4 billion high-speed train order in Germany. Industrial Business profit rose 22% to €3.9 billion in the quarter.

Smart Infrastructure posted all-time quarterly highs across the board. Orders rose 40% to €8.7 billion, revenue 16% to €7.2 billion and profit 26% to €1.5 billion at a 20.3% margin. Siemens said the electrification and electrical products businesses again won numerous larger contracts from data center customers, predominantly in the U.S. and Europe. Tariff refunds in the U.S. helped profit. For the full year, the unit's orders rose 34% on a comparable basis to €31.4 billion.

Digital Industries lifted fourth-quarter profit 50% to €1.2 billion, with margin at 20.9% against 15.5% a year earlier. The gain rested mainly on stronger short-cycle automation sales and lower severance charges. Software revenue rose 13% to €2.1 billion, led by the electronic design automation business. Integration costs for the Altair and Dotmatics acquisitions trimmed €36 million from profit. Full-year software revenue grew 13% to €7.2 billion, with annual recurring revenue up 12% to €6.1 billion.

Siemens also sold a further 0.7% stake in Siemens Energy for €0.8 billion in the quarter and now holds 4.9%. Siemens Energy reported its own record year a day earlier on grid and gas turbine demand.

What changes with the Healthineers spin-off?

Siemens will transfer 34.1% of its Siemens Healthineers stake to shareholders during fiscal 2027, at one Healthineers share for every two Siemens shares, then deconsolidate the medical technology company. Healthineers moves to discontinued operations once criteria are met, expected in the first quarter of fiscal 2027. The new guidance excludes it.

On that basis, Siemens forecasts fiscal 2027 comparable revenue growth of 9% to 11% and a book-to-bill ratio above 1. Segment targets:

• Smart Infrastructure: 11% to 13% growth, 19.5% to 20.5% margin
• Digital Industries: 8% to 12% growth, 20% to 22% margin
• Mobility: 6% to 8% growth, 8% to 10% margin

EPS pre PPA is forecast at €10.20 to €10.80, against €9.27 in fiscal 2026 excluding Healthineers. The outlook excludes burdens from legal and regulatory matters — a caveat worth noting, since such items have moved Siemens results before.

"Industrial AI is an exceptional growth opportunity, and Siemens is built to win in this space," Chief Executive Roland Busch said. The claim is broad. The numbers behind it, at least for now, rest on concrete demand from data centers and rail, and on a backlog of €143 billion that gives the raised targets room to hold.