"In the second quarter, we benefited from the high demand for digitalization and sustainability, especially for data centers and in the semiconductor industry. Siemens proved resilient with strong sales development in Smart Infrastructure, Mobility and the industrial software business. This enabled us to largely compensate for the currently subdued demand in the automation business in Digital Industries," said Roland Busch, President and CEO of Siemens, on May 16, 2024 on the occasion of the publication of the results for the second quarter of the current fiscal year 2024 .

On a comparable basis, i.e. excluding currency translation and portfolio effects, revenue was almost unchanged year-on-year at €19.2 billion (Q2 2023: €19.4 billion). Order intake fell by 12% on a comparable basis to EUR 20.5 billion (Q2 2023: EUR 23.6 billion), whereby the decline was primarily due to a much higher volume of major orders in Mobility in the same quarter of the previous year. The ratio of incoming orders to sales ('book-to-bill ratio') achieved a strong value of 1.07. With an order backlog of 114 billion euros, Siemens achieved a record figure and continued on its growth path.

The industrial business

At € 2.5 billion, the result from Industrial Business was almost on a par with the previous year (Q2 2023: € 2.6 billion). The earnings margin amounted to 14.0% (Q2 2023: 14.2%). Profit after tax fell to €2.2 billion (Q2 2023: €3.6 billion), with the prior-year quarter benefiting from a tax-free profit of €1.6 billion due to a reversal of impairment losses on the Siemens stake in Siemens Energy AG. Basic earnings per share before the effects of the purchase price allocation (EPS pre PPA) amounted to EUR2.73 (Q2 2023: EUR4.57), with EPS pre PPA from the prior-year quarter amounting to EUR2.01 as a result of the reversal of impairment losses.

Revenue growth in Smart Infrastructure and Mobility

In a challenging market environment, Digital Industries ' order intake fell by 12% to EUR 4.3 billion on a like-for-like basis, mainly due to continued higher inventories at customers and distributors, particularly in China. In contrast, incoming orders in the software business rose considerably, mainly due to the electronic design automation (EDA) software business in the USA.
On a comparable basis, sales revenue fell by 11% to EUR 4.5 billion. Higher sales revenue in the software business, particularly in the EDA segment, was outweighed by declines in the automation business, especially for higher-margin products. Earnings fell by 41% to EUR 741 million, while the profit margin was 16.5%. Earnings and profitability fell primarily due to lower capacity utilization as a result of declining sales and a less favourable product mix in the automation businesses.

At Smart Infrastructure, order intake rose by 10% on a comparable basis to EUR 6.1 billion with growth contributions from all businesses. This was the first time that Smart Infrastructure had exceeded EUR 6 billion in a quarter and set a quarterly record for incoming orders. Geographically, the increases were led by the USA, where the Electrical Products and Electrification businesses recorded numerous orders from data center operators. On a comparable basis, sales revenue also grew in all businesses by a total of 6% to EUR 5.1 billion. The Electrification business achieved the highest increase due to a strong processing of its order backlog. In regional terms, the USA recorded the highest contribution to growth. The result rose by 10% to 854 million euros. The earnings margin reached 16.6% compared to 15.9% in the same quarter of the previous year.

Mobility recorded a significant increase in sales on a comparable basis of 6% to EUR 2.8 billion with growth in all businesses. By contrast, order intake fell by 49% on a comparable basis to EUR 3.2 billion and included an order for light rail vehicles in the USA amounting to EUR 0.4 billion and a number of major orders for locomotives in Europe. The second quarter of 2023 included a much higher volume of major orders, including an order for locomotives and associated maintenance in India worth EUR 2.9 billion. With higher sales revenue and strong project execution, almost all businesses increased earnings and profitability. Earnings amounted to EUR 237 million and the earnings margin was 8.4% compared to 9.2% in the same quarter of the previous year, in which earnings and profitability benefited from Russia-related effects.

Forecast confirmed at Group level

Siemens confirms its forecast for the Siemens Group for fiscal year 2024. The company continues to assume that geopolitical tensions will not increase further. Under this condition, the Industrial Business is expected to continue to grow profitably overall.
The Siemens Group continues to expect revenue growth on a comparable basis (adjusted for currency translation and portfolio effects) in a range of 4% to 8% and a book-to-bill ratio of over 1.

In contrast to previous assumptions, the reduction in inventories at customers of Digital Industries' automation businesses is likely to continue well into the second half of the calendar year, particularly in China. Digital Industries expects demand in its automation businesses to pick up again in the second half of the 2024 financial year compared to the first half of the financial year and anticipates large orders in the software business. As a result, Digital Industries now expects revenue for the 2024 financial year to be between minus 8% and minus 4% below the previous year's figure on a comparable basis (previously: 0% to plus 3%). The earnings margin is now expected to be in the range of 18% to 21% (previously: 20% to 23%).

Smart Infrastructure now expects revenue growth on a comparable basis of between 8% and 10% for the 2024 financial year (previously: 7% and 10%) and an earnings margin in a range of 16% to 17% (previously: 15% to 17%).
Mobility also confirms its expectations for the 2024 financial year of like-for-like revenue growth of between 8% and 11% and an earnings margin of between 8% and 10%.

It is also assumed that the overall profitable growth of the Industrial Business will result in higher basic earnings per share (for earnings after taxes) before purchase price allocation effects (EPS pre PPA) in the range of EUR 10.40 to EUR 11.00 in fiscal year 2024, excluding positive EUR 0.61 per share from Siemens Energy investment in the first quarter of fiscal year 2024. After the end of equity accounting in the first quarter of fiscal year 2024, Siemens Energy investment is not expected to have any additional effects on earnings per share in the future. EPS pre PPA, excluding the Siemens Energy investment, amounted to EUR 9.93 in fiscal year 2023.