Siemens Posts Strong Q2 Revenue Growth and Higher Order Inflows as Capex Cycle Picks Up

Siemens posted a 17 percent year-on-year rise in consolidated revenue to 5,734 crore rupees for the September quarter of fiscal year 2027, beating analyst estimates. Order inflows jumped 38 percent to 6,228 crore rupees, pushing the total order backlog to 47,034 crore rupees and providing revenue visibility of about 2.5 times trailing 12-month revenue.

Revenue Breakdown

The smart infrastructure business led the growth with a 20 percent increase in revenue to 3,281 crore rupees. Mobility and digital industries grew 14 percent and 8 percent to 1,291 crore rupees and 1,150 crore rupees respectively. Motilal Oswal Financial Services expects the smart infrastructure segment to achieve a 17 percent revenue compound annual growth rate over FY26 to FY29.

Margins and Costs

Raw material costs rose at a faster pace of 21 percent, which pulled the gross margin down by 260 basis points to 27.3 percent. Ebitda margin contracted by 150 basis points to 10.9 percent, though it recovered 180 basis points sequentially due to lower operating expenses and price hikes. Meanwhile, mobility Ebit margin compressed by 364 basis points to 7.5 percent, and digital industries Ebit margin dropped 200 basis points to 5 percent.

Context

Capital expenditure cycles reflect broader industrial investment trends where companies and governments spend heavily on long-term physical assets like machinery, grids, and transport networks. Raw material cost pressures often squeeze manufacturing profits when rising input expenses outpace a company's ability to raise finished product prices.