Siemens Energy’s €8 Billion Cash Pledge Hinges on Gamesa’s Second-Half Recovery
07.05.2026 - 10:41:11 | boerse-global.de
The numbers coming out of Siemens Energy are eye-catching. The grid business is booming, the order book is bulging, and management has just doubled its free cash flow forecast to a staggering €8 billion. But beneath the headline figures, a single question dominates: can the troubled wind turbine division Siemens Gamesa finally turn profitable?
The answer will determine whether the group’s entire upgraded outlook for the 2026 financial year holds up — and whether activist investors pushing for a breakup get their way.
The Activist Challenge
Hedge fund Ananym Capital has gone public with demands for a strategic review of Gamesa. Co-founder Charlie Penner wrote to the board proposing a full separation of the wind power subsidiary, arguing that shareholders could reap returns of up to 60 percent from such a move. The fund contends that the profitable gas and grid businesses are being dragged down by Gamesa’s persistent losses.
Chief executive Christian Bruch has not ruled out a spin-off but insists on stabilising the wind division first. The numbers show some progress: Gamesa’s operating loss narrowed to €44 million in the second quarter, compared with €249 million a year earlier. However, management cautions that the first half of the financial year will still be in the red, with a recovery in offshore wind expected to deliver breakeven only in the second half.
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That breakeven is non-negotiable. The company has made it an explicit condition for maintaining the full-year forecast.
Grid Technologies Carries the Load
While Gamesa struggles, the Grid Technologies division is firing on all cylinders. Orders surged 41 percent in the infrastructure business, helping push group order intake to €17.75 billion — comfortably ahead of analyst expectations. The unit is now targeting revenue growth of 25 to 27 percent with margins between 18 and 20 percent.
The strong performance has prompted management to lift its full-year guidance. Siemens Energy now expects comparable revenue growth of 14 to 16 percent, an underlying operating margin of 10 to 12 percent, and free cash flow before taxes of around €8 billion — double the previous target range of €4 billion to €5 billion.
The group is also planning a massive capital return. A share buyback programme aims to repurchase up to €6 billion worth of stock by the end of 2028. Combined with dividends, Siemens Energy intends to return roughly €10 billion to shareholders over the next two years.
A Shifting Shareholder Base
The ownership structure is evolving in parallel with the operational changes. Former parent Siemens AG has cut its stake to 5.54 percent of voting rights, down from nearly 15 percent. Asset manager Amundi has also reduced its position, now holding 2.98 percent.
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Analysts at Deutsche Bank have raised their price target to €195 with a “Buy” rating, noting that despite a miss on quarterly operating numbers, the upward revision to all full-year targets suggests stronger momentum in the second half. The stock trades at an expected price-to-earnings ratio above 50, reflecting high expectations for the turnaround.
The May 12 Reckoning
Siemens Energy will publish its full half-year report on May 12. Investors will scrutinise Gamesa’s cash flow and margins with particular intensity. If the wind division fails to meet its internal milestones, pressure for a rapid separation from Ananym Capital and other shareholders is likely to intensify dramatically.
The gas turbine business, meanwhile, is booked solid through 2028, with initial orders already on the books for 2030. The operational risk has become heavily concentrated in one place: Gamesa. Whether that risk is managed within the group or carved out entirely will be one of the defining decisions of Bruch’s tenure.
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