Siemens shares fall after AI-led outlook raise disappoints

Siemens shares fell six percent in early Frankfurt trading on Thursday after the German industrial group raised its annual profit outlook for the second time this year, with analysts saying the new forecast fell short of investor hopes.

Siemens said demand linked to artificial intelligence and data centres had helped lift quarterly results. The company now expects earnings per share, a measure of underlying profitability, of 11.20 to 11.50 euros, or $12.93 to $13.28, for the year. Its previous guidance in February was 10.70 to 11.10 euros.

Net profit for the three months to the end of June rose 15 percent to 2.6 billion euros, while sales rose eight percent to 20.8 billion euros.

Order intake, an indicator of future sales, rose 14 percent from a year earlier to a record 27.9 billion euros, leaving Siemens with a backlog of 132 billion euros. Orders jumped 42 percent at the Smart Infrastructure division, which supplies electrical equipment for data centres and industrial customers.

Chief executive Roland Busch told reporters that the data centre business was “especially dynamic” and that the rapid build-out of cloud and AI infrastructure was continuing to drive demand.

Analysts also pointed to concerns that new AI tools could disrupt Siemens's software business. RBC bank analysts wrote that the earnings uplift “appears less pronounced than peers” and said uncertainty around demand and AI software risks could limit investor enthusiasm.

Busch said he expected AI to increasingly drive demand for Siemens's software products. Siemens also reported growth at its Digital Industries division, which focuses on software to automate industrial processes.

Siemens makes trains, industrial software, electrical equipment and medical and industrial machinery.