On November 12, 2026, German industrial equipment giant Siemens reported results for fiscal 2026 (October 2025 to September 2026) and raised its medium-term sales growth target from 6–9% to 7–11%. Growth rates are calculated on a comparable basis, which excludes currency effects and changes in business portfolio. Total Digital Business revenue rose 16% year on year to €10.9 billion, driven by industrial software and digital services. The company positions industrial AI as a future growth area, and rising AI demand is also boosting orders for data center equipment. Meanwhile, Siemens plans to separate its medical technology business in fiscal 2027, so changes in the business portfolio need to be taken into account when evaluating future results.
Orders reach €108.2 billion, and Industrial Business margin improves
Orders in fiscal 2026 came to €108.2 billion, up 25% on a comparable basis from €88.4 billion the year before. Revenue grew from €78.9 billion to €83.4 billion, an 8% increase on the same basis. Because comparable growth rates exclude currency effects and portfolio changes, they differ from the growth rate obtained by simply comparing reported revenue figures.
Industrial Business profit rose 13% year on year to €13.3 billion, and the margin improved from 15.4% to 16.3%. Net income for the group as a whole fell from €10.4 billion the previous year to €9.5 billion, but the prior-year figure included a €2.1 billion gain on the sale of Innomotics. Free cash flow for the group, combining continuing and discontinued operations, increased from €10.8 billion to €12.1 billion.
The order backlog grew from €117.0 billion to €143.0 billion, and the book-to-bill ratio, which divides orders by revenue, came to 1.30. This means new orders in the period exceeded revenue, building up a pipeline of future sales. However, when the backlog will be recognized as revenue, and how much profit it will generate, depends on the terms and delivery timing of individual contracts.
The fourth quarter of fiscal 2026 (July to September) was also strong, with orders up 58% year on year to €34.8 billion. Revenue rose 10% on a comparable basis to €23.7 billion, and Industrial Business profit increased 22% to €3.9 billion, for a margin of 16.8%. The Mobility and Smart Infrastructure businesses contributed most to the order growth, while Smart Infrastructure made the largest contribution to revenue growth.
Of particular note is the growth of the data center business, driven by the expansion of AI infrastructure. According to additional reporting by Reuters carried on AOL, Siemens supplies data centers with power distribution equipment, cooling systems, and digital facility simulation technology. Of the group's €143.0 billion backlog, €7.0 billion comes from data center-related products. The company also told Reuters that data center orders in the fourth quarter doubled from the same period a year earlier.
Digital Business revenue reaches €10.9 billion as software and recurring revenue grow
In addition to rising demand for data center equipment, Siemens continues to grow in software and digital services. Digital Business revenue for fiscal 2026 came to €10.9 billion, up 16% year on year. However, the results announcement did not disclose revenue or profit for industrial AI on its own, so the growth of the Digital Business as a whole cannot simply be treated as a result of the AI business.
Software revenue in the Digital Industries segment reached €7.2 billion, up 13% on a comparable basis. The segment's annual recurring revenue (ARR) rose 12% on the same basis to €6.1 billion. ARR indicates the annual scale of revenue that recurs from subscription contracts and similar arrangements, and differs from software revenue recognized for accounting purposes in a given fiscal year. Note also that the 16% growth for the Digital Business as a whole and the 13% comparable growth in software revenue are not calculated under identical conditions.
Siemens CEO Roland Busch described industrial AI as a major growth opportunity and indicated the company will expand its products and services through its digital business platform, Siemens Xcelerator. When analyzing Siemens' growth, it is important to distinguish between data center equipment and the software business. The equipment backlog reflects future revenue from product deliveries, while software revenue and ARR indicate trends in income from digital products and services. Looking at the two separately makes it easier to see how much investment in AI-related equipment and growth in the software business each contribute to results.
Fiscal 2027 outlook: 9–11% revenue growth, with the healthcare separation changing the baseline
Alongside raising its medium-term sales growth target, Siemens also raised its medium-term growth target for basic earnings per share before purchase price allocation accounting effects (EPS pre PPA) from high single digits to double digits. For fiscal 2027, it expects comparable revenue growth of 9–11% and EPS pre PPA of €10.20–10.80. However, the fiscal 2027 earnings forecast should not be compared directly with the group-wide results for fiscal 2026.
Siemens plans to directly spin off Siemens Healthineers, its medical technology business, during fiscal 2027 and remove it from consolidation. The company expects the conditions for classifying the business as a discontinued operation to be met in the first quarter of fiscal 2027. As a result, the fiscal 2027 EPS forecast is based on fiscal 2026 results excluding the healthcare business.
| Period | Scope | EPS pre PPA |
|---|---|---|
| Fiscal 2026 actual | Group, including Siemens Healthineers | €11.76 |
| Fiscal 2026 comparison basis | Excluding healthcare business | €9.27 |
| Fiscal 2027 forecast | Excluding healthcare-related effects | €10.20–10.80 |
The baseline for the fiscal 2027 EPS forecast of €10.20–10.80 is the fiscal 2026 figure of €9.27, which excludes the healthcare business. Comparing it with the group-wide result of €11.76 could lead to a mistaken assessment of growth because of the difference in business scope. The outlook excludes not only the operating profit of the healthcare business but also non-cash gains and related costs from the separation transaction, as well as equity-method income or losses that may arise in the future from the retained stake. It also assumes global economic growth and does not account for burdens related to legal and regulatory matters.
By segment, Siemens expects fiscal 2027 comparable revenue growth of 8–12% and a margin of 20–22% for Digital Industries. For Smart Infrastructure, it anticipates revenue growth of 11–13% and a margin of 19.5–20.5%, and for Mobility, revenue growth of 6–8% and a margin of 8–10%. It also continues to expect a group book-to-bill ratio above 1.
Siemens raised its medium-term targets on the back of growing orders for AI infrastructure equipment and growth in industrial software. Going forward, the key questions will be how quickly the €143.0 billion backlog converts into revenue and profit, and whether growth in software revenue and recurring revenue continues. As the healthcare separation changes the business mix, the earning power of the remaining industrial businesses should become easier to assess from fiscal 2027 onward.