November 15, 2023, Bavaria, Munich: Flags with the lettering “Siemens” in front of the corporate headquarters. Siemens publishes figures for the 2022/23 financial 12 months. Photo: Karl-Josef Hildenbrand/dpa (Photo by Karl-Josef Hildenbrand/picture alliance via Getty Images)
Karl Josef Hildenbrand | Picture Alliance |
German industrial technology giant Siemens reported better-than-expected quarterly operating profit on Thursday and confirmed its outlook for the complete 12 months.
Industrial profit for the quarter ended June was 3 billion euros ($3.3 billion), up 11 percent from the identical quarter last 12 months. The figure was also above the analyst consensus expected by the corporate.
Comparable orders fell by 15 percent in comparison with the identical quarter last 12 months and reached EUR 19.8 billion, Siemens said. The order volume rose by double digits within the Digital Industries and Smart Infrastructure divisions, but fell sharply within the mobility business.
Siemens CEO Roland Busch told CNBC on Thursday that the corporate’s performance within the quarter was “very, very strong.”
Shares were trading 0.65% lower at 9:30 a.m. London time on Thursday. The pan-European STOXX 600 The index traded 1.13% lower.
The company attributed its third-quarter growth to strong demand in its electrification and industrial software businesses, but noted that its automation business remained “challenging.”
There was “extraordinarily high order growth in the software business, driven by a number of large orders for licensed software,” the corporate said. The growth in profitability greater than offset the drop in profits within the automation sector.
“Smart Infrastructure continued its broad-based year-over-year increase in earnings and profitability due to higher revenues, improved capacity utilization and ongoing productivity improvements,” the corporate added.
In a conference call after the figures were announced, Siemens CEO Busch told journalists, in accordance with Reuters, that it might not be possible to repeat the expansion within the software business in a comparable manner.
In its latest results, Siemens announced a major decline in its automation business.
The company also confirmed its outlook for the complete fiscal 12 months on Thursday, but noted that comparable sales growth for the Siemens Group is anticipated to be on the lower end of the forecast range of 4 to eight percent.
Speaking to CNBC, Busch attributed this forecast to “difficult market conditions,” adding that the foremost problems are weakness in industrial markets and ongoing inventory buildup, which can take a while to clear.
He said the corporate has the proper portfolio and is equipping it with artificial intelligence to support customers.
“All in all, we are looking forward to what is coming,” said Busch.
