German industrial gear maker Siemens reported robust earnings growth for the April-to-June quarter, driven by customers upgrading their electricity infrastructure and a strong demand for production software. Siemens posted an 11% increase in operating profit to 3.0 billion euros ($3.3 billion), surpassing analysts’ expectations of 2.84 billion euros.
For the fiscal year ending in September, Siemens confirmed its guidance, citing high orders for industrial software balanced by challenges in the industrial automation sector. Revenue growth is projected at the lower end of the 4%-8% range, adjusted for currency fluctuations, acquisitions, and divestments.
The Digital Industries unit, which produces software and automation gear, is expected to hit the lower end of its profit margin target, while the Smart Infrastructure unit, responsible for ventilation, wiring, and security systems, aims for the upper end.
Quarterly orders fell 15% but exceeded expectations at 19.8 billion euros. Siemens also announced plans to expand its management board from five to seven members to accelerate its transition to a technology-focused enterprise.