Munich, May 16, 2024 (Financeflashnews) – German industrial giant Siemens reported a slight decline in profits for the second quarter of fiscal year 2023/2024, despite growth in other areas. The main culprit: a sluggish performance from its Digital Industries division, which focuses on software and automation systems for factories.
Siemens’ profit fell 2% to €2.51 billion, missing analyst expectations. Net income for the group dropped 38% to €2.19 billion, translating to €2.54 per share. Revenue dipped 1% to €19.16 billion, also falling short of forecasts.
The Digital Industries division saw lower orders, sales, and profits during the quarter. The company cited a slowdown in growth across China and other Asian markets, along with the war in Ukraine and its associated supply chain disruptions and rising energy costs, as factors impacting the results.
Despite the decline in Digital Industries, Siemens’ other divisions exhibited growth. The Mobility division, responsible for trains and metro systems, saw an 8% increase in revenue, while the Smart Infrastructure division, focused on energy and buildings, experienced a 5% rise.
Siemens anticipates its economic growth to accelerate in the second half of 2024. The company believes its investments in digital technologies and the growing demand for green technologies will fuel future expansion.
In addition to the profit decline, Siemens also announced the sale of its Innomotics motor division to KPS Capital Partners for €3.5 billion. This transaction is expected to close in the fourth quarter of 2024.
Siemens’ Q2 profit decline serves as a signal of the multiple challenges facing global industry. The war in Ukraine, rising energy prices, and supply chain disruptions are impacting economic activity across many countries. Despite these challenges, Siemens remains optimistic about its future prospects and believes its investments for growth will help it overcome these hurdles.
