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Siemens Energy expects to make about €1bn in profit in 2025 after upgrading its outlook because of a booming global electricity market.
In an ad hoc announcement published on Wednesday night, the German producer of gas turbines and power grid equipment increased its profit expectations, projecting a net income of “up to €1bn”. That figure is lower than the €1.3bn profit it posted last year but higher than the guidance previously issued, which had said it expected to roughly break even.
The company also raised its revenue forecasts for the fiscal year 2025, which ends in September, lifting them from 8-10 per cent to 13-15 per cent.
The growth was driven by a particularly strong performance in the gas services and grid technologies division. “There’s a growing electricity market, with huge demand for gas turbines, grid switches,” said a person familiar with the company’s operations. “We’re seeing huge demand.”
The International Energy Agency said in a report in February that global electricity demand would grow about 4 per cent annually between now and 2027 — up from 2.5 per cent in 2023. This is its fastest pace in years and comes as a result of the growing needs of industry, strong demand for electrification as part of the drive to decarbonise, greater use of air conditioning, and an increasing need for the energy-hungry data centres that underpin generative AI.
Siemens Energy has suffered a turbulent ride on the stock market this year, with its share price rising and falling as much as 20 per cent within a matter of days in January.
First, its value was buoyed by US President Donald Trump’s announcement of up to $500bn in private investment to fund infrastructure for AI, which the markets expected to boost demand for data centres and electricity. Then it plunged as the Chinese artificial intelligence start-up DeepSeek shocked Silicon Valley with advances apparently achieved with far less computing power than its US rivals.
The company has also had to grapple with the after-effects of a crisis in its wind turbine division, Siemens Gamesa, that emerged in 2023. The company suffered a €4.6bn loss that year after it revealed technical problems with some of its turbines and was forced to take a €15bn government-backed bailout. It returned to profit the following year.
The company said on Wednesday that it expected the wind turbine unit to enjoy positive revenue growth in 2025 but still suffer a loss of €1.3bn before special items.