By Nina Kienle

Siemens posted better-than-expected revenue and net profit for its second quarter on a strong performance of its industrial business.

The German technology giant on Thursday said that it saw revenue growth in most industrial businesses, led by significant increases at mobility and smart infrastructure.

Profit from industrial business rose 29% to 3.24 billion euros ($3.62 billion) for the quarter ended March 31, with an expanded margin of 16.9% from 14%. The figure beat analysts' expected 2.75 billion euros, according to a company-compiled consensus.

In its second quarter, a reversal of income tax provisions had resulted in lower income tax expenses and a gain within discontinued operations, Siemens said.

Orders rose in the electrification business, supported by a number of contract wins from energy customers and continues to be driven by rigorous execution of data-center projects, Chief Executive Roland Busch said in a press call. Industrial companies that have reported so far this earnings season also continue to benefit from data-center sentiment.

For Siemens's digital industries division, the automation business saw clear order growth, driven by higher demand in China, where destocking approached completion toward the end of the quarter, the company said.

European peer Schneider Electric also noted progressive recovery in automation led by China. Switzerland-listed ABB said its robotics and automation business turned a corner in the first quarter, with both divisions recording strong order growth year-on-year. In the U.S., Eaton raised its full-year guidance as demand in end market continues to drive strong organic growth.

Limited impact from U.S. trade tariffs on digital industries, smart infrastructure and mobility is seen for fiscal 2025, CEO Busch said. Measures to mitigate any impact include price adjustments by diversifying production capacities, he added.

Siemens has pricing power as an industry leader but doesn't see reason yet to make use of it, Busch said. In addition, the company has diversified value chains and good geopolitical distribution, he added.

Looking at Germany, the CEO has high hopes for the new government. "Germany has potential to rebound," he said.

For the quarter ended March, Siemens posted net profit of 2.25 billion euros, up from 2.03 billion euros the prior year. Revenue rose 7% to 19.76 billion euros.

The figures beat analysts expectations of net profit at 1.85 billion euros on revenue of 19.22 billion euros, according to consensus estimates compiled by the company.

Orders amounted to 21.64 billion euros, above analysts' estimated 20.07 billion euros, according to the same consensus.

For fiscal 2025, the company backed its outlook, targeting group comparable revenue growth between 3% and 7%.

Smart infrastructure's profit margin is estimated to range between 17% and 18%, and digital industries' s profit margin between 15% and 19%.

The Altair acquisition is not yet included in the guidance, it noted.

Shares trade 3.7% lower at 215.75 euros.

RBC Capital Markets analysts in a note said that recent share price strength could create some short-term downside risk.

Write to Nina Kienle at nina.kienle@wsj.com

(END) Dow Jones Newswires

May 15, 2025 03:36 ET (07:36 GMT)

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