It wasn't so long ago that problems in the wind business and losses running into billions were dominating the headlines around Siemens Energy. However, the energy company managed to make a new start last year. This can be seen not only in the business figures, but also in the share price. The value of the DAX member increased almost tenfold between October 2023 and January 2025. Recently, however, the share price rally was disrupted by the Chinese start-up DeepSeek, which presented AI applications that require less computing power. Siemens Energy lost around a fifth of its market capitalization in just one day of trading due to concerns about lower demand for electricity. However, the slump was quickly countered. Investors can now make clever use of the resulting high volatility with new barrier reverse convertibles.
One after the other: The Spanish wind power subsidiary Gamesa has been proving to be a spoilsport in the Siemens Energy Group for years. Among other things, quality and productivity problems have led to high losses. In the 2022/23 financial year alone (September 30), the loss amounted to EUR 4.6 billion. Even though the division is still deep in the red, the turbine manufacturer is making progress with its restructuring. The Executive Board is already forecasting a positive operating return of 3% to 5% for 2028. This will also have an impact on the company as a whole: The consolidated operating margin is expected to improve from an anticipated 3% to 5% in 2025 to 10% to 12% by then.
The progress that is already visible, as well as the planned progress, has recently calmed the capital market and refocused investors' attention on the future prospects of rising global demand for electricity. The AI hype in particular is creating a consistently positive sentiment at Siemens Energy. This is reflected in the strong order intake. In the past fiscal year 2023/24, this increased by 42% to EUR 15.0 billion. The two divisions Grid Technologies (GT) and Gas Services (GS) in particular recorded major orders. "Our focus remains on profitable growth, supported by extremely positive market conditions," said CEO Christian Bruch, looking confidently to the future when presenting the annual figures.
With the figures just presented for the first quarter of 2024/25, the manager, whose contract was prematurely extended by a further five years until April 2030, underlines his optimistic statement. Revenue increased from EUR 7.65 billion to EUR 8.9 billion, while the operating result adjusted for one-off effects more than doubled to EUR 481 million. On average, market participants had expected significantly less for both key figures. Although order intake was down, analysts had expected a greater slump here. The order situation at the problem child Gamesa stands out positively. The southern European company received 51% more orders than in the previous year.
The better-than-expected start to the new year and easing concerns about DeepSeek have recently brought Siemens Energy shares back into the game. The blue chip has now almost made up for the deep dive at the end of January. There is a growing view that the Chinese AI innovation will not restrict the global expansion of data centers, but that efficiency gains could instead lead to increasing demand. This is justified by the "Jevons paradox". The economic theory developed in the 19th century by British economist William Stanley Jevons describes the phenomenon that when a raw material is used more efficiently, demand for it does not necessarily fall.
With its grid technology and power generation and transmission businesses, Siemens Energy is undisputedly one of the AI beneficiaries. The Germans expect the strong demand for electricity to be a major driver of infrastructure investment. Data centers are expected to account for up to 4% of global demand in 2030. The transformation of electricity generation is also continuing. In addition to an increasing share of renewable energies, there will be a shift from coal to gas and a renaissance of nuclear energy, according to the company. With a share of 31%, the gas sector is actually the largest division in the Group. In nuclear power, which is assigned to the "Transformation of Industry" division, Siemens Energy is focusing on small modular reactors, for example, which more and more tech giants want to use to supply their data centers with electricity.
The sharp ups and downs of the Siemens Energy share have recently led to a significant increase in volatility. These fluctuations can be converted into top conditions in a barrier reverse convertible. Leonteq has seized the moment and launched two new soft-callable BRCs on the DAX stock. The products have a high risk buffer of 45% and at the same time offer the prospect of double-digit percentage returns. The Swiss franc-denominated paper has a coupon of 14.00% p.a., while the EUR version even offers a maximum yield of 16.00% p.a. In order to receive the quarterly coupon payment, the Siemens Energy share must be quoted above the coupon trigger level, which is a low 50% of the starting level, on the observation dates. However, if the interest payment is not made on a key date, it can easily be made up again on the following observation dates due to the memory function.
Due to the product structure, a sideways movement of the Siemens Engery share is therefore completely sufficient to achieve the maximum return. The maximum term of one year can be shortened due to the soft callable function. Every quarter, but at the earliest after 6 months, there may be an early redemption at 100%.
We look forward to answering all of your questions about our products and how they are traded. Please don't hesitate to get in touch! Phone: 058 800 11 11, email info@leonteq.com or contact us here.