Siemens reported smaller-than-expected declines in fiscal second-quarter earnings and revenue Thursday. The multinational tech leader also touted its ability to capitalize on growing AI data center investments. SIEGY stock dropped Thursday.
Siemens Q2 earnings sank 46% to $1.27 per share as revenue decreased around 1% to $20.8 billion. Analysts had predicted EPS of $1.21 per share and sales totaling $20.76 billion, according to FactSet.
For the full year, Siemens said it expects EPS of $5.65-$5.95 and revenue between $87.807-$91.184 billion. The company previously forecast full-year EPS of $5.60-$5.90 and sales between $87.04-$90.39 billion.
Ahead of Q2 earnings, analysts saw full-year EPS of $5.68 per share and sales coming in at $86.42 billion.
Siemens reported Thursday that "strong momentum" continues in the data center and power distribution markets. The multinational added that its electrical products business and its electrification segment were "major growth" engines. Siemens said it "scored major order wins from data centers customers, particularly in the U.S."
The company saw 38% order growth in the U.S. driven primarily by hyperscale data center projects.
Top hyperscalers — the largest cloud, data center and AI providers — include Amazon.com's AWS, Microsoft, Meta and Alphabet.
Chief Executive Roland Busch said on the Q2 earnings call Thursday that "unprecedented growth in AI application drives a massive buildout of data centers globally with soaring demand for power."
"This market momentum creates an abundance of opportunities for us with existing customers such as hyperscalers and, increasingly, with global co-location operators," Busch said.
Chief Financial Officer Ralf Thomas added on the Q2 earnings call that "AI is the supercharger for data center investment for the foreseeable future, also leading to higher power demand."
Siemens Stock, Oklo Links
SIEGY shares fell 7% to 94.95 during market trade Thursday. On Wednesday, Siemens stock advanced 1.5% to 102.06, moving above an official 101.97 buy point in a cup base, according to MarketSurge analysis.
Ahead of Thursday trade, the stock had gained more than 7% in 2024. It was up 9% in May after booking consecutive monthly declines.
On Feb. 8, after reporting fiscal Q1 earnings, Siemens stock edged up around 1%. Meanwhile on Nov. 16, 2023, SIEGY shares gained 6% after the company announced Q4 earnings. On Aug. 10, 2023, Siemens stock sank 5.3% on third-quarter earnings and revenue.
Siemens reported in February that Q1 orders for electrification and electrical products "benefited from larger projects with repeatable and scalable solutions especially in the data center business."
"Don't underestimate also the data center space," Busch told analysts on the Q1 earnings call in February. "Microsoft builds a new one every month and the requirement on really high-quality, reliable electrification products is quite high."
Last week, S&P 500 component Constellation Energy announced it is in discussions with major companies to provide nuclear power for AI data centers, with projects expected to scale up through the decade. In December, a memorandum of understanding from Oklo named Siemens as a potential preferred supplier for its Aurora line of small, site-built nuclear powerhouses.
Oklo is the nuclear fission company headed by OpenAI CEO Sam Altman. The company went public through a special purpose acquisition company on May 10.
Please follow Kit Norton on X @KitNorton for more coverage.
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