Siemens Energy (LON:0SEA) reported record third-quarter fiscal 2026 orders, revenue and profitability, while its Siemens Gamesa wind business posted its first positive quarterly result since the fourth quarter of fiscal 2022.
President and CEO Christian Bruch said the company’s results reflected sustained demand in its core markets, pricing discipline, selective project bidding and the effect of capacity investments. “The structural drivers behind our markets remain firmly intact,” Bruch said, adding that the company is focused on turning backlog into profitable growth, cash generation and shareholder returns.
Backlog reaches €162 billion
The company’s book-to-bill ratio was 1.57 in the quarter, lifting its order backlog to an all-time high of €162 billion. Ferraro said backlog had expanded by nearly 20% over the past 12 months and provides substantial visibility for fiscal 2026 and fiscal 2027. In certain areas of the portfolio, lead times now extend three to four years or more.
Siemens Energy said newer orders generally enter the backlog at margins above the historical portfolio average. Ferraro added that long-term service agreements in Gas Services have an average duration of 17 years, supporting recurring revenue opportunities as the company expands its installed base.
Free cash flow before tax was €2.3 billion in the quarter and €7.2 billion year to date. The company attributed the cash performance to improved cash-effective profit, stronger conversion, customer advance payments and reservation fees tied to order intake. Siemens Energy maintained its expectation for around €8 billion of free cash flow before tax for the full fiscal year, noting that fourth-quarter cash flow will include a substantial capital-expenditure load and other timing effects.
Gas and grid businesses lead growth
Gas Services recorded orders of €10 billion, up 62% from the prior-year period, and ended the quarter with a record €73 billion backlog. The business booked 73 gas turbines, including 25 large gas turbines and 48 industrial gas turbines. Siemens Energy said its market share in gas turbines above 100 megawatts reached 42% during the quarter.
Gas Services revenue rose 21% to €3.8 billion, while profit before special items increased 60% to €648 million. Its margin reached 17.3%, up 420 basis points year over year. Service represented 60% of revenue, slightly below the prior-year level because of greater new-unit deliveries.
Bruch said demand for reliable, dispatchable electricity generation remains especially strong in the U.S., Middle East and Asia. The company booked 15 gigawatts of gas-service orders during the quarter, including conversions of prior reservation agreements into firm orders. Management expects fourth-quarter orders to be lower than recent levels but described the fiscal 2027 pipeline as promising.
The company brought additional medium-sized gas turbine capacity online during the quarter, increasing annual production capacity from about 50 units in fiscal 2025 to approximately 80 units in fiscal 2026. Its larger gas-turbine expansion program remains on track to begin contributing in fiscal 2027. Bruch said the company is prioritizing productivity improvements and expanded output at existing sites rather than announcing a change in its capacity-expansion plan.
Grid Technologies posted 28% order growth to €5.4 billion and raised its backlog to €51 billion. Revenue increased 29% to a record €3.6 billion, driven mainly by products including transformers. Profit before special items rose to €722 million, for a 19.9% margin, up 400 basis points from a year earlier. The business benefited from demand related to electrification, grid expansion, renewable integration and data-center infrastructure.
Siemens Gamesa returns to quarterly profitability
Siemens Gamesa reported a profit before special items of €75 million, compared with a €430 million loss in the prior-year quarter. Its margin improved to positive 2.7%, a year-over-year improvement of more than 20 percentage points. Revenue rose 14% to €2.7 billion, primarily due to offshore activity and higher service revenue.
Orders at Siemens Gamesa were €1.1 billion, below the unusually high prior-year comparison, which included two offshore orders worth more than €3 billion combined. Its backlog stood at €31 billion at quarter-end. Free cash flow before tax was negative €518 million, improving from negative €758 million a year earlier.
Bruch and Ferraro said the turnaround remains unfinished, with execution discipline, quality management and cost efficiency continuing as priorities. Still, Bruch called the return to positive quarterly profitability an important milestone and said the company remains on track for full-year break-even at Siemens Gamesa.
Outlook, shareholder returns and brand transition
Siemens Energy reaffirmed its fiscal 2026 outlook for comparable revenue growth of 14% to 16%, a profit margin before special items of 10% to 12%, net income of about €4 billion and free cash flow before tax of around €8 billion. Management said it now expects group profitability to finish toward the upper end of its guided margin range.
The company also said it expects approximately €3.6 billion of shareholder returns during fiscal 2026, including a dividend paid in March for fiscal 2025 and share repurchases. The first €2 billion buyback tranche was completed in May, while the second €1 billion tranche is expected to be completed in coming weeks.
In credit-related developments, Moody’s reaffirmed Siemens Energy’s Baa1 rating and changed its outlook to positive in June, while S&P upgraded the company to BBB+ with a stable outlook in July. Siemens Energy also increased its ownership in Siemens Energy India Limited to 16%, including a 3.98% stake acquired from Siemens AG for €428 million.
Finally, Siemens Energy said it has begun preparing a transition to an independent brand. Siemens Energy and Siemens Gamesa Renewable Energy are planned to operate under the name Omterra, with implementation beginning later in the calendar year in phases.
About Siemens Energy (LON:0SEA)
Siemens Energy AG operates as an energy technology company worldwide. It operates through Gas Services, Grid Technologies, Transformation of Industry, and Siemens Gamesa segments. The company provides gas and steam turbines, generators, and heat pumps, as well as performance enhancement, maintenance, customer training, and professional consulting services for central and distributed power generation; and high voltage direct current transmission systems, offshore windfarm grid connections, transformers, flexible alternating current transmission systems, high voltage substations, air and gas-insulated switchgears, digital grid solutions and components, and storage solutions.
