Q3 2026 Siemens Energy AG Earnings Call - Press Conference

August 5, 2026

Speaker #1: Sehr geehrte.

Speaker #2: Ladies and gentlemen, welcome to today's question-and-answer session from Siemens Energy AG on Q3 for fiscal 2026. We'd like to remind you that all participants are in listen-only mode and that this call is being recorded.

Operator: Ladies and gentlemen, welcome to today's question and answer session from Siemens Energy AG on Q3 for fiscal 2026. We'd like to remind you that all participants are in listening mode and that this call is being recorded. If you want to ask a question, press star 1 on your phone, and if you need operator's assistance during the call, please press star 0. I'd now like to hand over to our moderator, Tim Krölgäver. Good morning everyone from Berlin and welcome to today's press call for Q3 from Siemens Energy, not Siemens AG, which was incorrectly mentioned. The format will be the same as last time around. There will be no presentation. We will just go directly to the Q&A with our CEO, Christian Bruch. We published our financial figures at 7:00 AM this morning.

Speaker #2: If you want to ask a question, press star plus one on your phone. If you need operator assistance during the call, please press star plus zero.

Speaker #2: I'd now like to hand over to our moderator, Tim Krulgava. Good morning, everyone, from Berlin, and welcome to today's press call for Q3 from Siemens Energy.

Tim Proll-Gerwe: Good morning everyone from Berlin and welcome to today's press call for Q3 from Siemens Energy, not Siemens AG, which was incorrectly mentioned. The format will be the same as last time around. There will be no presentation. We will just go directly to the question-and-answer with our Chief Executive Officer, Christian Bruch. We published our financial figures at 7:00AM this morning. We increased order intake and revenue, and we have EUR 17.9 billion, and this is the amount of revenue we had. Profitability increased considerably once again.

Speaker #2: Not Siemens AG, which was incorrectly mentioned. The format will be the same as last time around. There will be no presentation; we will just go directly to the Q&A with our CEO, Christian Bruch.

Speaker #2: We published our financial figures at 7 o'clock this morning. We increased order intake and revenue, and we have €17.9 billion, and this is the amount of revenue we had. Profitability increased considerably, once again.

Moderator: We increased order intake and revenue, and we have EUR 17.9 billion, and this is the amount of revenue we had. Profitability increased considerably once again. Profit before special items was triple that of last year, and the margin before SI was 14.2% in Q3. Wind, for the first time in 15 quarters, achieved a positive result. Preparing for our transition to a standalone brand, we will, Siemens Energy that is, and Siemens Gamesa will be using the name Omterra. A lot has happened, I'm quite sure that there are some questions for this quarter. Now I'd like to let you ask. You can ask your questions of CEO Christian Bruch. There's a telephone number for all journalists if you want to ask questions, please press star 1 on your phone. You can ask your questions in English or in German.

Speaker #2: Profit before special items was triple that of last year, and the margin before special items was 14.2% in Q3. Wind, for the first time in 14 of 15 quarters, achieved a positive result.

Tim Proll-Gerwe: Profit before special items was triple that of last year, and the margin before SI was 14.2% in Q3. Wind, for the first time in 15 quarters, achieved a positive result. Preparing for our transition to a standalone brand, we will, Siemens Energy that is, and Siemens Gamesa will be using the name Omterra. A lot has happened, I'm quite sure that there are some questions for this quarter.

Speaker #2: And preparing for our transition to a standalone brand, we will—Siemens Energy, that is—and Siemens Gamesa will be using the name Almterra. A lot has happened, and I'm quite sure that there are some questions for this quarter. So now, I'd like to let you ask; you can ask your questions of CEO Christian Bruch.

Tim Proll-Gerwe: Now I'd like to let you ask. You can ask your questions of CEO Christian Bruch. There's a telephone number for all journalists if you want to ask questions, please press star 1 on your phone. You can ask your questions in English or in German. This call will be transmitted in two webcasts. There'll be the original line and an English line. Interpreters will be interpreting for you into English, you can also ask questions of Christian Bruch, and please use the chat function. I'd just like to remind you once again that this is only for journalists. Only journalists can ask questions. We've seen that some shareholders have also asked questions.

Speaker #2: There is a telephone number for all journalists. If you want to ask questions, please press star plus one on your phone. You can ask your questions in English or in German.

Speaker #2: This call will be transmitted in two webcasts. There will be the original line and an English line. Interpreters will be interpreting for you into English.

Moderator: This call will be transmitted in two webcasts. There'll be the original line and an English line. Interpreters will be interpreting for you into English, you can also ask questions of Christian Bruch, and please use the chat function. I'd just like to remind you once again that this is only for journalists. Only journalists can ask questions. We've seen that some shareholders have also asked questions. These will not be answered today. Analysts can ask their questions later on today in the analyst calls, employees can ask their questions at town hall meetings, and shareholders, of course, at the AGM. For the sake of completeness, I'd like to remind you of the Safe Harbor statement with regard to future-related statements. You can see this in the webcast now. Now we can enter into our Q&A session.

Speaker #2: And you can also ask questions of Christian Bruch, and please use the chat function. I'd just like to remind you once again that this is only for journalists—only journalists can ask questions.

Speaker #2: We've seen that some shareholders have also asked questions. These will not be answered today. Analysts can ask their questions later on today in the analyst calls, and employees can ask their questions at town hall meetings.

Tim Proll-Gerwe: These will not be answered today. Analysts can ask their questions later on today in the analyst calls, employees can ask their questions at town hall meetings, and shareholders, of course, at the AGM. For the sake of completeness, I'd like to remind you of the Safe Harbor statement with regard to future-related statements. You can see this in the webcast now. Now we can enter into our Q&A session. Star 1 for questions by phone, or you can ask your questions in the chat. I see that we already have a question from Christoph Staatz from Reuters. Good morning, Mr. Staatz.

Speaker #2: And shareholders, of course, at the AGM. For the sake of completeness, I'd like to remind you of the safe harbor statement with regard to forward-looking statements.

Speaker #2: You can see this in the webcast now. And now we can enter into our Q&A session. Press star one for questions by phone, or you can ask your questions in the chat.

Moderator: Star 1 for questions by phone, or you can ask your questions in the chat. I see that we already have a question from Christoph Staatz from Reuters. Good morning, Mr. Staatz.

Speaker #2: And I see that we already have a question from Christoph Stutz from Reuters. Good morning, Mr. Stutz.

Speaker #3: Yeah, guten Morgen.

Christian Bruch: Good morning. I have a couple of questions. Maybe I'll start with the Middle East. Mr. Bruch, can you tell us how the demand from the Middle East has changed? Can you quantify that? What was the impact of the Middle East in Q3? Because it's been mentioned before, and it would be good to understand how the gas business was dependent on the Middle East. The second question, the increasingly important slot reservations for capacities is something that's very critical. Can you squeeze more out of your customers? Because usually, it's 10% to 15% of revenue that is relevant for reservations. My question would be, given the current demand in the market, could you get more from them? If not, why not? I have another question on Transformation of Industry. There are considerations to carve out that segment.

Christoph Steitz: Good morning. I have a couple of questions. Maybe I'll start with the Middle East. Mr. Bruch, can you tell us how the demand from the Middle East has changed? Can you quantify that? What was the impact of the Middle East in Q3? Because it's been mentioned before, and it would be good to understand how the gas business was dependent on the Middle East. The second question, the increasingly important slot reservations for capacities is something that's very critical. Can you squeeze more out of your customers? Because usually, it's 10% to 15% of revenue that is relevant for reservations. My question would be, given the current demand in the market, could you get more from them? If not, why not? I have another question on Transformation of Industry. There are considerations to carve out that segment.

Speaker #4: Good morning. I have a couple of questions. Maybe I'll start with the Middle East. Mr. Bruch, can you tell us how the demand from the Middle East has changed?

Speaker #4: So can you quantify that? What was the impact of the Middle East in Q3? Because it's been mentioned before, and it would be good to understand how the gas business was dependent on the Middle East.

Speaker #4: And the second question: the increasingly important slot reservations for capacities is something that's very critical. Can you squeeze more out of your customers? Because usually, it's 10 to 15 percent of revenue that is relevant for reservations.

Speaker #4: And now, my question would be: Given the current demand in the market, could you get more from them? And if not, why not? I have another question on transformation of industries.

Speaker #4: There are considerations to carve out that segment. Now, my question would be, from your point of view, what would be the advantage of a standalone business and the transformation of the industry?

Christian Bruch: My question would be, from your point of view, what would be the advantage of a standalone business of Transformation of Industry? You don't want to do it for Siemens Gamesa, Transformation of Industry has a good margin, 17%, so it's going well. What would be the advantage of a standalone business of TI? Does it not fit into a portfolio? If so, why not? If I may, a final question on Siemens Gamesa. Can you give us some gist here? Because the guidance says breaking even in 2026 and the first month in Q3 now, so that's not Q4. Do you stay with your optimistic guidance? Well, thank you very much, and good morning, Mr. Staatz. Me and Mr. Staatz, we can do these calls on our own, can't we? The Middle East and how has that driven our business?

Christoph Steitz: My question would be, from your point of view, what would be the advantage of a standalone business of Transformation of Industry? You don't want to do it for Siemens Gamesa, Transformation of Industry has a good margin, 17%, so it's going well. What would be the advantage of a standalone business of TI? Does it not fit into a portfolio? If so, why not? If I may, a final question on Siemens Gamesa. Can you give us some gist here? Because the guidance says breaking even in 2026 and the first month in Q3 now, so that's not Q4. Do you stay with your optimistic guidance?

Speaker #4: You don't want to do it for Siemens Gamesa, but Transformation of Industry is a good margin—17 percent—so it's going well. What would be the advantage of a standalone business of TI?

Speaker #4: Does it not fit into a portfolio? And if so, why not? And if I may, a final question on Siemens Gamesa—can you give us some gist here?

Speaker #4: Because the guidance says breaking even in 2026, and we're only in the first months of the third quarter now, so that's not the fourth quarter. Do you still stand by your optimistic guidance?

Speaker #4: Well, thank you very much, and good morning, Mr. Stutz. We—Mr. Stutz and I—can do these calls on our own, can't we?

Christian Bruch: Well, thank you very much, and good morning, Mr. Staatz. Me and Mr. Staatz, we can do these calls on our own, can't we? The Middle East and how has that driven our business? Let me try to say that off the top of my head. It's several gigawatts of large projects. For the overall quarter and gigawatts, it would be 30%. That's a rough and ready estimate now when it comes to gigawatts. It's very substantial. Those are large power station things happening in that part of the world now. The Middle East has always been an important region, especially Saudi Arabia, UAE, Oman, and Qatar. That truly is something that we see going forward now. The conflict hasn't changed anything to that, I have to say. Quite on the contrary, there is now a discussion of creating a resilient energy structure in that region, and this will preoccupy us going forward.

Speaker #4: Now, the Middle East—and how has that driven our business? Let me try to say that off the top of my head. It's just several gigawatts of large projects.

Christian Bruch: Let me try to say that off the top of my head. It's several gigawatts of large projects. For the overall quarter and gigawatts, it would be 30%. That's a rough and ready estimate now when it comes to gigawatts. It's very substantial. Those are large power station things happening in that part of the world now. The Middle East has always been an important region, especially Saudi Arabia, UAE, Oman, and Qatar. That truly is something that we see going forward now. The conflict hasn't changed anything to that, I have to say. Quite on the contrary, there is now a discussion of creating a resilient energy structure in that region, and this will preoccupy us going forward. Can you get more from customers? We're not squeezing anything out of our customers, if you want to put it like that.

Speaker #4: Now, for the overall quarter and gigawatts, it would be 30 percent. I mean, that's a revenue-ready estimate now when it comes to gigawatts, so it's very substantial.

Speaker #4: Those are large power stations. Things are happening in that part of the world now. And the Middle East has always been an important region, especially Saudi Arabia, UAE, Oman, and Qatar.

Speaker #4: And that truly is something that we see going forward now. Now, the conflict hasn't changed anything about that, I have to say – quite on the contrary.

Speaker #4: There is now a discussion of creating a resilient energy structure in that region, and this will preoccupy us going forward. Can you get more from customers?

Christoph Steitz: Can you get more from customers?

Speaker #4: Now, we're not squeezing anything out of our customers, if you want to put it like that. What we are trying to do is tap this positive market momentum and, at the same time, also arrange for a good setup with our customers.

Christian Bruch: We're not squeezing anything out of our customers, if you want to put it like that. What we are trying to do is to tap this positive market momentum and at the same time also to arrange for a good setup with our customers. Let's say 10% to 20% that is currently discussed about in terms of reservation agreements means that at the end of the day, we want to make sure that this looks like a down payment, that down payment will lapse if you don't buy the turbine, in other words. Of course, we are interested in the cash profile of the entire project, and it has to be right, and it has to fit our balance sheet. If you will, this is a rather calm process. We are not doing any windfall profit optimization. That is not our business model.

Christian Bruch: What we are trying to do is to tap this positive market momentum and at the same time also to arrange for a good setup with our customers. Let's say 10% to 20% that is currently discussed about in terms of reservation agreements means that at the end of the day, we want to make sure that this looks like a down payment, that down payment will lapse if you don't buy the turbine, in other words. Of course, we are interested in the cash profile of the entire project, and it has to be right, and it has to fit our balance sheet. If you will, this is a rather calm process. We are not doing any windfall profit optimization. That is not our business model.

Speaker #4: Let's say 10 to 20 percent. That is currently discussed about in terms of reservation agreements, which means that at the end of the day, we want to make sure that this looks like a down payment, but that down payment will lapse if you don't buy the turbine, in other words.

Speaker #4: But of course, we are interested in the cash profile of the entire project, and it has to be right, and it has to fit.

Speaker #4: Our balance sheet. So, if you will, this is a rather calm process. We are not doing any windfall profit optimization; that is not our business model.

Speaker #4: We have a long-term relationship with our customers, and that's very important, because we're in a business here that has been around for decades. And it's not a short-term optimization thing.

Christian Bruch: We have a long-term relationship with our customers, that's very important because we're in a business here that is done for decades, and it's not a short-term optimization thing. TI. Well, let me contextualize that. Generally, if you look at Siemens Energy as a company, this is an organization that over the past 6 years has changed a lot, and we're going to change going forward as well because we're working in two areas, in two business areas, which are certainly different. There's some segments that are driven by electricity, by gas, wind, grids. Transformation of Industry is a segment that is focusing on industry and industry development. Both segments are working differently, and they're subject to different cycles. The beauty of Siemens Energy at the moment is that both segments are very profitable. They're growing. They're very successful.

Speaker #4: TI, well, let me contextualize that. And generally, if you look at Siemens Energy as a company, this is an organization that, over the past six years, has changed a lot, and we're going to change going forward as well.

Speaker #4: Because we're working in two areas, in two business areas, which are certainly different. There are some segments that are driven by electricity, by gas, wind, and grids.

Speaker #4: The Transformation of Industry is a segment that is focusing on industry and industry development. Both segments are working differently, and they are subject to different cycles, but the beauty of Siemens Energy at the moment is that both segments are very profitable.

Speaker #4: They're growing. They're very successful. But they're battling for the same resources when it comes to capital investments. And we need and want to make sure that, in the next three, five, or ten years, those businesses can compete well in a competitive environment that is ambitious.

Christian Bruch: They're battling for the same resources when it comes to capital investments. We need and want to make sure that in the next 3 or 5 or 10 years, those businesses can compete well in a competitive environment that is ambitious. This is always the question we're asking. When we are seeing an opportunity where not everyone can be catered to accordingly, we need to respond. We are not doing this as seeing quick wins at the moment. If we want to be successful in electricity, we need different portfolio elements, these discussions will be here to stay going forward, and that's quite a natural thing. Of course, there will be questions from our investors about what will happen to the wind business. I'd like to take this rationes out of it. This needs to be a calm business.

Speaker #4: And this is always the question we're asking. When we see an opportunity where not everyone can be catered to accordingly, we need to respond.

Speaker #4: But we are not doing this just to see quick wins at the moment. If we want to be successful in electricity, we need different portfolio elements.

Speaker #4: And these discussions will be here to stay going forward, and it's quite a natural thing. And, of course, there will be questions from our investors about what will happen to the wind business.

Speaker #4: But I'd like to take the rashness out of it. This needs to be a calm business. Every business needs to have a good opportunity to flourish in the future.

Christian Bruch: Every business needs to have a good opportunity to flourish in the future, we'd like to do just that. This is how we are leading this discussion at the moment, with very successful turnarounds in mind, or the experience of that we've had. Now, the question is, how do we make sure that our business continues to flourish in the next 3 or 5 or 10 years? This is what our discussion is currently focusing on, we're proceeding step by step. In terms of our guidance, we're very confident because we said before, at the upper range of our profit margin is where we're going to see the guidance. You have seen, if you look at the first Q3 of the year, that we're doing really very well.

Speaker #4: And we'd like to do just that. This is how we are leading this discussion at the moment, with very successful turnarounds in mind.

Speaker #4: The experience that we've had. Now, the question is: how do we make sure that our business continues to flourish in the next three, five, or ten years?

Speaker #4: This is what our discussion is currently focusing on, and we're proceeding step by step. In terms of our guidance, we're very confident, because we said before that the upper range of our profit margin is where we're going to see the guidance.

Speaker #4: And you have seen, if you look at the first three quarters of the year, that we're doing really very well. We assume that there will be a certain seasonality in our profits.

Christian Bruch: We assume that there will be a certain seasonality in our profits, this is also why we didn't change the guidance range. As I said before, we're very confident because all the general conditions bode very well. We are in a good way forward. On the other hand, there's always fluctuation between the individual quarters, that will also mean for Q4. Mr. Stice also asked a question about break-even in the wind business. Yeah, we're in a good way. If you take the total over the first Q3, it's a small double-digit loss. The team is working very hard on it. I'm totally proud of what our wind team has achieved. Still, tough work ahead of us. To turn that into a highly profitable business, a lot remains to be done. It's a super milestone, I must say that.

Speaker #4: And this is also why we didn't change the guidance range. But as I said before, we're very confident, because all the general conditions bode very well.

Speaker #4: We are on a good path forward. On the other hand, there's always fluctuation between the individual quarters, and that will also be the case for Q4.

Speaker #4: And Mr. Stutz also asked the question about break-even in the wind business? Yeah, we're on a good way. I mean, if you take the total over the first three quarters, it's a small double-digit loss.

Speaker #4: But the team is working very hard on it. I'm totally proud of what our wind team has achieved, but still, tough work ahead of us.

Speaker #4: And to turn that into a highly profitable business, a lot remains to be done. But it's a super milestone, I must say that.

Speaker #4: Thank you very much. Next question comes from Axel Hübner of Handelsblatt. Good morning, Mr. Hübner. Good morning. I have two questions. Now, first, the data center effect.

Christian Bruch: Thank you very much. Next question comes from Axel Höpner of Handelsblatt. Good morning, Mr. Höpner. Good morning. I have two questions. First, the data center effect. Can you quantify that in that quarter? Can you tell us what your timeline will be for Transformation of Industry? Good morning, Mr. Höpner. Data centers. Now, when we look at gas turbines, because gas turbines is what most of the discussions focus on. If I remember correctly, it was 20% of our orders when it comes to capacities. So a little less than in the previous quarter because we're trying to strike a balance here consciously. When it comes to transformers, it's always lower than it is in gas as far as percentages are concerned.

Tim Proll-Gerwe: Thank you very much. Next question comes from Axel Höpner of Handelsblatt. Good morning, Mr. Höpner.

Axel Höpner: Good morning. I have two questions. First, the data center effect. Can you quantify that in that quarter? Can you tell us what your timeline will be for Transformation of Industry?

Speaker #4: Can you quantify that for the quarter? And can you tell us what your timeline will be for the transformation of the industry? Good morning, Mr. Hübner.

Christian Bruch: Good morning, Mr. Höpner. Data centers. Now, when we look at gas turbines, because gas turbines is what most of the discussions focus on. If I remember correctly, it was 20% of our orders when it comes to capacities. So a little less than in the previous quarter because we're trying to strike a balance here consciously. When it comes to transformers, it's always lower than it is in gas as far as percentages are concerned.

Speaker #4: Data centers. Now, when we look at gas turbines—because gas turbines are what most of the discussion is focused on—if I remember correctly, it was 20 percent of our orders when it comes to capacities.

Speaker #4: So, a little less than in the previous quarter, because we're trying to strike a balance here, consciously. And when it comes to transformers, it's always lower than it is in gas, as far as percentages are concerned.

Speaker #4: So what I'm saying is, it's an important segment, and we believe it's here to stay. But it's not as dominating as some reporting would suggest out there.

Christian Bruch: What I'm saying is it's an important segment. We believe it's here to stay, but it's not as dominating as some reporting would suggest out there. Albeit, this is a market that no one has seen five years ago. This market will be here to stay. It fits nicely with our balance sheet. As far as the timelines are concerned, you're always well-informed, you guys, I must say that. We don't have a timeline saying something is going to happen now or at a certain date. We're rightly in discussions with our supervisor organizations, with our employees, with employee representatives, works council. This is an internal discussion more than anything right now, and we're looking at the long-term future of this business.

Speaker #4: And albeit, this is a market that no one had seen five years ago. So this market will be here to stay. So it fits nicely with our balance sheet.

Speaker #4: As far as the timelines are concerned, you’re always well informed, you guys—I must say that. But we don’t have a timeline saying something is going to happen now or at a certain date.

Speaker #4: We're rightly now in discussions with our supervisory organizations, with our employees, with employee representatives or ex-counsel. So this is an internal discussion more than anything right now.

Speaker #4: And we're looking at the long-term future of this business. But of course, we are very much interested in being very clear to our workforce and telling them, look, this is how we're going to continue.

Christian Bruch: Of course, we are very much interested in being very clear to our workforce and tell them, Look, this is how we are going to continue. One thing is still abundantly clear. Nothing's going to happen rashly overnight and quickly because what we are talking about is so important. When things are up for discussion, we take our time. Let me say this again very clearly. We are working in two very good segments. Those are entirely different in terms of how they work, how they operate. We need to massively invest in all segments. Competitors are doing this as well. We need to address that. Again, this is going to happen step by step. As soon as we have decisions and we have more clarity, we'll reach out to the press.

Speaker #4: But one thing is still abundantly clear: nothing's going to happen rashly, overnight, or quickly, because what we are talking about is so important. And when things are up for discussion, we take our time.

Speaker #4: But let me say this again very clearly: We are here, we are working in two very good segments, but those are entirely different in terms of how they work, how they operate.

Speaker #4: And we need to massively invest in all segments. Competitors are doing this as well, so we need to address that. But again, this is going to happen step by step.

Speaker #4: As soon as we have decisions, and we have more clarity, we'll reach out to the press. But today is not the day to do that.

Christian Bruch: Today is not the day to do that. We cannot talk about decisions yet. Next question.

Speaker #4: And we cannot talk about decisions yet.

Speaker #1: The next of.

Speaker #2: The next question comes from the chat, from Michael Gulund from Energy Watch in Denmark. And he's basically got two questions. We hear about a possible European merger in wind, and the Chinese competition there.

Moderator: The next question comes from the chat, from Michiel Gudunt from EnergyWatch in Denmark, he's basically got two questions. We hear about a possible European merger in wind and the Chinese competition there in order to counter the Chinese competition. How do you see that? How do you see the discussions? Would Siemens Gamesa be interested in such consolidation? He would also like to know about what Henrik Andersen said from Vestas, and they said that the European antitrust law might have a problem with regard to such a giant in the wind section. Well, this has been a discussion that's been going on as long as I've been with Siemens Energy, and this is something where, well, I can't really comment on that. Henrik is correct. This, of course, is a question of antitrust questions, which we want in Europe.

Tim Proll-Gerwe: The next question comes from the chat, from Michiel Gudunt from EnergyWatch in Denmark, he's basically got two questions. We hear about a possible European merger in wind and the Chinese competition there in order to counter the Chinese competition. How do you see that? How do you see the discussions? Would Siemens Gamesa be interested in such consolidation? He would also like to know about what Henrik Andersen said from Vestas, and they said that the European antitrust law might have a problem with regard to such a giant in the wind section.

Speaker #2: In order to counter the Chinese competition, how do you see that? How do you see the discussions? Would Siemens Gamesa be interested in such consolidation?

Speaker #2: And he would also like to know about what Henrik Andersen said from Vestas, and they said that the European antitrust law might have a problem with regard to such a giant in the wind sector.

Speaker #2: Well, this has been a discussion that's been going on as long as I've been with Siemens Energy, and this is something where—well, I can't really comment on that.

Christian Bruch: Well, this has been a discussion that's been going on as long as I've been with Siemens Energy, and this is something where, well, I can't really comment on that. Henrik is correct. This, of course, is a question of antitrust questions, which we want in Europe.

Speaker #2: And Henrik is correct. This, of course, is a question of antitrust issues. What do we want in Europe? And the point we have to deal with here is we're in a market now where the Chinese competitors are massively joining the market, and we cannot beat their prices with regard to the asset cost, for example.

Christian Bruch: The point we have to deal with here is we're in a market now where the Chinese competitors are massively joining the market, and we cannot beat their prices with regard to the assets cost, for example. That, of course, is quite obvious. This is a discussion which I think it's not the manufacturers to have this discussion. I think it's also the EU that has to discuss this. What do we want in this respect? I don't see the underlying conditions there right now where we really can have such a discussion successfully if we say, I'm going to take all of the wind companies in Europe together, put them all together. That won't work in terms of antitrust regulation. We have these discussions in European Airbus, for example, or Wind Airbus, and here, this is something we haven't gotten there yet.

Speaker #2: And that, of course, is quite obvious. But this is a discussion which I think it's not just the manufacturers who should have. I think it's also the EU that has to discuss this.

Speaker #2: What do we want in this respect? I don't see the underlying conditions there right now where we really can have such a discussion successfully if we say, I'm going to take all of the wind companies in Europe together—put them all together.

Speaker #2: That won't work in terms of antitrust regulation. So we have these discussions. In European Airbus, for example, or within Airbus. And here, this is something we haven't gotten to yet.

Speaker #2: And I think, at the end of the day, this is a political discussion. Christoph Ruhmeier from the German Press Agency. Good morning, Mr. Ruhmeier.

Moderator: I think at the end of the day, this is a political discussion. Christoph Ruhmeyer from the German Press Agency. Good morning, Mr. Ruhmeyer. Good morning. The first question is, we're talking about Transformation of Industry, and this reminds me of Mr. Kaeser when he spoke about energy. It sounds quite similar that something is going to happen, and I probably won't get any information from you on that. When we talk about the question of order intake, is this something that is below revenue? It's not only the EUR 3 billion project from the previous year that you don't see this year. Do we have to be concerned about that, about order intake being under revenue? Well, thank you for the question. I wasn't there when Mr. Kaeser said something many years ago, but let's remember this, of course. It's our job.

Christian Bruch: I think at the end of the day, this is a political discussion.

Tim Proll-Gerwe: Christoph Ruhmeyer from the German Press Agency. Good morning, Mr. Ruhmeyer.

Speaker #2: Good morning. The first question is: we're talking about transformation of industry, and this reminds me of Mr. Kaiser when he spoke about energy. So it sounds quite similar—something is going to happen, and I probably won't get any information from you on that.

Christoph Meyer: Good morning. The first question is, we're talking about Transformation of Industry, and this reminds me of Mr. Kaeser when he spoke about energy. It sounds quite similar that something is going to happen, and I probably won't get any information from you on that. When we talk about the question of order intake, is this something that is below revenue? It's not only the EUR 3 billion project from the previous year that you don't see this year. Do we have to be concerned about that, about order intake being under revenue?

Speaker #2: And when we talk about the question of order intake, is this something that is below revenue? It's not only the €3 billion project from the previous year that you don't see this year.

Speaker #2: Do we have to be concerned about that, about order intake being under revenue? Well, thank you for the question. I wasn't there when Mr. Kaiser said something many years ago.

Christian Bruch: Well, thank you for the question. I wasn't there when Mr. Kaeser said something many years ago, but let's remember this, of course. It's our job. We're managers, and we have to see how are we going to continuously develop our portfolio. You've seen that in the last quarter or a couple of quarters ago, companies were acquired to add to our portfolio.

Speaker #2: But let's remember this: of course, it's our job. We're managers, and we have to see how we are going to continuously develop our portfolio.

Christian Bruch: We're managers, and we have to see how are we going to continuously develop our portfolio. You've seen that in the last quarter or a couple of quarters ago, companies were acquired to add to our portfolio. That's my job, to see what will secure our company and keep us successful and secure jobs over the next several years. That's my job. We have these discussions quite frequently, and that's why I believe that Well, I'd put the question somewhat differently. Of course, it's a natural process, and that's management's job to do this. Gamesa, order intake. We mentioned this a number of times in terms of Well, let me put it this way. We have a very careful look at order intake at offshore.

Speaker #2: And you've seen that in the last quarter or a couple of quarters ago, companies were acquired to add to our portfolio. That's my job: to see what will secure our company and keep us successful and secure jobs over the next several years.

Christian Bruch: That's my job, to see what will secure our company and keep us successful and secure jobs over the next several years. That's my job. We have these discussions quite frequently, and that's why I believe that Well, I'd put the question somewhat differently. Of course, it's a natural process, and that's management's job to do this. Gamesa, order intake. We mentioned this a number of times in terms of Well, let me put it this way. We have a very careful look at order intake at offshore. A lot of projects that were originally planned are slipping, and because companies, and we also consider interest rates, they play a role there as well, they are not willing to make the final investment decisions right now.

Speaker #2: That's my job, and we have these discussions quite frequently. That's why I believe that—well, I would put the question somewhat differently. Of course, it's a natural process.

Speaker #2: And that's management's job to do this. Gamesa order intake—we mentioned this a number of times. In terms of—well, let me put it this way.

Speaker #2: We take a very careful look at order intake in offshore. A lot of projects that were originally planned are slipping, and because companies—and we also—consider interest rates, they play a role there as well.

Moderator: A lot of projects that were originally planned are slipping, and because companies, and we also consider interest rates, they play a role there as well, they are not willing to make the final investment decisions right now. Offshore wind projects tend to be very large as individual projects. Once one project is shifted, then it is a big difference, and it is different with onshore. That is where we say we really have to add some speed to this. That is why we are calling upon the government, the 16 gigawatt that were optioned. These are not going to be constructed. That is why we can only say this again and again. The other thing that you have to see, and this is a question of timing. Of course, in onshore, we have a very slow ramp-up after we interrupted and said, "Stop." Now this is beginning to pick up again.

Speaker #2: They're not willing to make the final investment decisions right now. Offshore wind projects tend to be very large as individual projects, so once one project is shipped, then it makes a big difference.

Christian Bruch: Offshore wind projects tend to be very large as individual projects. Once one project is shifted, then it is a big difference, and it is different with onshore. That is where we say we really have to add some speed to this. That is why we are calling upon the government, the 16 gigawatt that were optioned. These are not going to be constructed. That is why we can only say this again and again. The other thing that you have to see, and this is a question of timing. Of course, in onshore, we have a very slow ramp-up after we interrupted and said, "Stop." Now this is beginning to pick up again.

Speaker #2: And it's different with onshore. That's where we say we really have to add some speed to this. That's why we're calling upon the government—the 16 gigawatts that were auctioned.

Speaker #2: These are not going to be constructed, and that's why we can only say this again and again. The other thing that you have to see, and this is a question of timing.

Speaker #2: Of course, in onshore, we have a very slow ramp-up after we interrupted and said, stop. Now, this is beginning to pick up again. Yes, we can see the first projects are coming in.

Moderator: Yes, we can see the first projects are coming in, and of course, that is the second effect that you see. Offshore, absolutely, something needs to happen there. There has been a lot of discussion what is going to happen in 2027 and 2028, but we really need to make sure that we do not just say in 6 months or in 12 months time. No, what we need now is the awareness that offshore wind is to be added on. The question as to order intake came from EnergyWatch, so that question has also been answered. Now we have Clara from the WirtschaftsWoche. Ms. Klea, go ahead. Good morning. I also have some questions on the possible carve-out of Transformation of Industry. The first question is, did not it surprise the head force that things were so well advanced and that the employee representatives are not excited about this?

Christian Bruch: Yes, we can see the first projects are coming in, and of course, that is the second effect that you see. Offshore, absolutely, something needs to happen there. There has been a lot of discussion what is going to happen in 2027 and 2028, but we really need to make sure that we do not just say in 6 months or in 12 months time. No, what we need now is the awareness that offshore wind is to be added on.

Speaker #2: And, of course, that’s the second effect that you see. But offshore—absolutely, something needs to happen there. There’s been a lot of discussion about what's going to happen in 2027 and 2028.

Speaker #2: But we really need to make sure that we don't just say, 'in six months' or 'in 12 months' time.' No, what we need now is the awareness that offshore wind is to be added on.

Speaker #2: The question about order intakes came from Energy Watch, so that question has also been answered. Now, we have clarity from the Future of Sweden.

Tim Proll-Gerwe: The question as to order intake came from EnergyWatch, so that question has also been answered. Now we have Clara from the WirtschaftsWoche. Ms. Klea, go ahead.

Speaker #2: This is clear. Go ahead. Good morning. I also have some questions on the possible carve-out or transformation of industry. The first question is, why didn’t it surprise the head force that things were so well advanced?

Clara Thier: Good morning. I also have some questions on the possible carve-out of Transformation of Industry. The first question is, did not it surprise the head force that things were so well advanced and that the employee representatives are not excited about this? They seem to be rejecting it. How do you want to get them on board? My second question on this would be, can you imagine Transformation of Industry and splitting it up and selling it to various different purchasers? You could say that there are very many different businesses included in Transformation of Industry. Marine, for example. This is something which is very sensitive, and you can only consider certain purchasers for this. My third question would be, if you sell them, then you will be losing your hydrogen business, and that is an important building block in your green story and a good supplement.

Speaker #2: And the employee representatives are not excited about this; they seem to be rejecting it. How do you want to get them on board?

Christian Bruch: They seem to be rejecting it. How do you want to get them on board? My second question on this would be, can you imagine Transformation of Industry and splitting it up and selling it to various different purchasers? You could say that there are very many different businesses included in Transformation of Industry. Marine, for example. This is something which is very sensitive, and you can only consider certain purchasers for this. My third question would be, if you sell them, then you will be losing your hydrogen business, and that is an important building block in your green story and a good supplement. Are you still there? We have seemed to have lost the connection. I think the question was asked. Is the conference still? I think we have lost her. Can you see what is going on? Can you hear us?

Speaker #2: My second question on this would be: can you imagine the transformation of energy, splitting it up, and selling it to various different purchasers?

Speaker #2: You could say that there are very many different businesses included in the transformation of industry. Marine, for example, this is something which is very sensitive.

Speaker #2: And you can only consider certain purchases for this. My third question would be, if you sell them, then you'll be losing your hydrogen business.

Speaker #2: And that's an important building block in your green story, and a good supplement.

Speaker #1: Thank you for that.

Speaker #2: Are you still there? You seem to have—we seem to have lost the connection. But I think the question was asked. Is the conference still— I think we've lost her.

Tim Proll-Gerwe: Are you still there? We have seemed to have lost the connection.

Christian Bruch: I think the question was asked. Is the conference still?

Tim Proll-Gerwe: I think we have lost her. Can you see what is going on? Can you hear us? If you can hear us, you seem to have been cut off. I apologize for that. Can you hear me? Is the journalist still with us?

Speaker #2: Can you see what's going on?

Speaker #1: I will put you on.

Speaker #2: Can you hear us? If you can hear us, it seems you have been cut off. I apologize for that. Can you hear me?

Moderator: If you can hear us, you seem to have been cut off. I apologize for that. Can you hear me? Is the journalist still with us?

Speaker #2: Is the journalist still with us?

Speaker #1: You can do it.

Moderator: Ladies and gentlemen, we now continue with our conference call. The line's open. Okay. I hope you can hear us. Apparently, we have had a technical glitch here. We apologize. I see all journalists are still on the line. Clara had asked three questions before on the supervisory board and the rumors about TI, whether a breakup of TI would be an option, and you also referred to the hydrogen business, which is an important sustainable factor for the future. That's what you said. Were there more questions? Yeah, three questions. Mr. Hers is now? Yeah, I do. Says Mr. Hers. Those were exactly my questions. You're right. Sorry. I thought I said something wrong because no one answered. No, we're very transparent, very open. No doubt about it.

Operator: Ladies and gentlemen, we now continue with our conference call. The line's open.

Speaker #2: Can you hear me? This is Morris from Quarter 12. Can the participants hear me as well? We're going to put some we're going to continue.

Speaker #2: Thank you.

Speaker #1: Sehr geehrte Damen und Herren, ladies and gentlemen, we now continue with our conference call. The line is open. Okay, I hope you can hear us.

Christian Bruch: Okay. I hope you can hear us. Apparently, we have had a technical glitch here. We apologize. I see all journalists are still on the line. Clara had asked three questions before on the supervisory board and the rumors about TI, whether a breakup of TI would be an option, and you also referred to the hydrogen business, which is an important sustainable factor for the future. That's what you said. Were there more questions?

Speaker #1: Apparently, we have had a technical glitch here. We apologize. But I see all journalists are still on the line. Clara Deer had asked three questions before.

Speaker #1: Regarding the supervisory board and the rumors about TI, whether a breakup of TI would be an option. You also referred to the hydrogen business, which is an important sustainable factor for the future.

Speaker #1: That's what you said. Did you have—were there more questions? Yeah, three questions. And Mr. Here's us now. Yeah, I do. I do. Says, Mr., those were exactly my questions.

Clara Thier: Yeah, three questions.

Christian Bruch: Mr. Hers is now?

Clara Thier: Yeah, I do. Says Mr. Hers. Those were exactly my questions. You're right. Sorry. I thought I said something wrong because no one answered.

Speaker #1: You're right. Sorry, sorry. You know, I thought I said something wrong because no one answered. No, no, no—we're very transparent, very open.

Christian Bruch: No, we're very transparent, very open. No doubt about it. Now, obviously, this is a discussion because there are always changes here and there, and we need time in order to address those change processes. Now, the best example for a successful business, a standalone business, is Siemens Energy. We would not be at this point where we are now if we had to fight for funds from Siemens AG. We have to explain this very well, of course, and I very appreciate this exchange with our employee representatives because they have good experience with working for this company. They know the business really well, and yes, it is a critical, but a constructive discussion we're having. With that in mind, we need to explain that there's a price you need to pay for inaction, and we need to tell people where we're headed, what we want to achieve.

Speaker #1: No doubt about it. Now, obviously, this is a discussion because there are always changes here and there, and we need time in order to address those change processes.

Christian Bruch: Now, obviously, this is a discussion because there are always changes here and there, and we need time in order to address those change processes. Now, the best example for a successful business, a standalone business, is Siemens Energy. We would not be at this point where we are now if we had to fight for funds from Siemens AG. We have to explain this very well, of course, and I very appreciate this exchange with our employee representatives because they have good experience with working for this company. They know the business really well, and yes, it is a critical, but a constructive discussion we're having. With that in mind, we need to explain that there's a price you need to pay for inaction, and we need to tell people where we're headed, what we want to achieve.

Speaker #1: Now, the best example of a successful business, a standalone business, is Siemens Energy. We would not be at the point where we are now if we had to fight for funds from Siemens AG.

Speaker #1: So we have to explain this very well, of course. And I very much appreciate this exchange with our employee representatives because they have good experience with working for this company.

Speaker #1: They know the business really well. And yes, it is a critical, but constructive, discussion we're having. So, with that in mind, we need to explain that there's a price you need to pay for inaction.

Speaker #1: And we need to tell people where we're headed, what we want to achieve. And I'm not going to say—I don't know what the result is going to be.

Christian Bruch: I'm not going to say, and I don't know what the result is going to be. Again, this is about different scenarios we're looking at, and it's a process. A process that rightly so will take time. I am confident because at the end of the day, this is about to keeping a successful business successful. That is different from earlier discussions. We're not talking about because, now we always got this sticker when it started, that we are the junk store of the industry. We're not. It's not a junk store. We have two extremely profitable businesses, lines of business, and we're investing money like crazy to continue growing. There's this number of challenges out there that we have in the changing environment, and this is what we need to understand.

Speaker #1: But again, this is about different scenarios we're looking at, and it's a process—a process that, rightly so, will take time. But I am confident because, at the end of the day, this is about keeping a successful business successful.

Speaker #1: And that is different from earlier discussions. We're not talking about that, because now we always got this sticker when it started—that we are the junk store of industry.

Speaker #1: We're not. It's not a junk store. We have two extremely profitable lines of business, and we're investing money like crazy to continue growing.

Speaker #1: So, there are a number of challenges out there that we have in the changing environment. And this is what we need to understand in the process, and I'm confident that we will continue this constructive discussion.

Christian Bruch: We're in the process, and I'm confident that we will continue this constructive discussion. Now, the breakup and the mixed bag or the general store, as you called it. Well, you have a product view on that. I don't. I'm looking at the customers and the customer groups that we work with. One is industry, and the other one is electricity or power customers. Now, in Transformation of Industry, the general line is that you always work with industry customers. Industry customers will buy a compressor here and a steam turbine there and an electrification solution there. This is exactly what we are trying to keep together. We believe there's an intrinsic value in it, and this is why we have set up Transformation of Industry and understand why this discussion is out there. Our logic is we want to create an industry customer business.

Speaker #1: Now, the breakup and the mixed bag, or the general store as you called it—well, you have a product view on that. I don't.

Speaker #1: I'm looking at the customers, and the customer groups that we work with: one is industry, and the other one is electricity or power customers. Now, in the transformation of industry, the general line is that you always work with industry customers.

Speaker #1: And industry customers will buy a compressor here, a steam turbine there, and an electrification solution somewhere else. And this is exactly what we are trying to keep together.

Speaker #1: We believe there's an intrinsic value in it, and this is why we have set up Transformation of Industry and understand why this discussion is out there.

Speaker #1: But our logic is, we want to create an industry customer business. That's our idea here. Now, in whatever shape and form, that's a different discussion.

Christian Bruch: That's our idea here. In whatever shape and form is a different discussion, but this is what Transformation of Industry is doing today, and we believe it's a good thing. When you talk about hydrogen, yes, I agree. Hydrogen is important. Unfortunately, it's a business where we need to witness that the market's not quite there, where we expect it to be three, four, five years ago. We always said it's going to be difficult, but it's different now. At the end of the day, this business in itself needs to be successful. Again, I've said it before, it's not so much a question of do I believe in this business, but really, what's the shape and form and structure of that business, and who's focusing on doing what. We have to explain this, we have to discuss this, and then take a decision.

Speaker #1: But this is what transformation of industry is doing today, and we believe it's a good thing. Now, when you talk about hydrogen, yes, I agree.

Speaker #1: Hydrogen is important. Unfortunately, it's a business where we need to witness that the market's not quite there—where we expected it to be three, four, five years ago.

Speaker #1: We always said it's going to be difficult, but it's different now. At the end of the day, this business in itself needs to be successful.

Speaker #1: And again, I said it before. It's not so much a question of, do I believe in this business, but really what's the shape and form and structure of that business, and who's focusing on doing what.

Speaker #1: So we have to explain this. We have to discuss this and then take a decision. But we were not there yet at this point.

Christian Bruch: We were not there yet at this point. That's important to underscore again, because sometimes the newspapers are saying as everything is cut and dried. It's not. Angela Meyer is next from Börsen-Zeitung. She's standing in for Mr. Heitger, who's on holiday today. Ms. Meyer. Hello, Mr. Bruch. I have a couple questions. One on Siemens Gamesa. We have good orders there, EUR 31 billion now, which is melting down now, just because you're getting fewer orders in now compared to revenue. Can you say a word about your orders in terms of onshore and offshore? Have you seen cancellations and delays? Just to get an understanding of what's happening in the wind power business. The free cash flow of Siemens Gamesa in Q3 is still EUR -518 million over 9 months.

Christian Bruch: We were not there yet at this point. That's important to underscore again, because sometimes the newspapers are saying as everything is cut and dried. It's not.

Speaker #1: That's important to underscore again, because sometimes the newspapers are saying as if everything is cut and dried. It's not. Angela Maya is next from Burson Saiteng.

Tim Proll-Gerwe: Angela Meyer is next from Börsen-Zeitung. She's standing in for Mr. Heitger, who's on holiday today. Ms. Meyer.

Speaker #1: She's standing in for Mr. Heitke, who's on holiday today. Ms. Maya: Hello, Mr. Po. I have a couple of questions, one on Siemens Gamesa.

Angela Maier: Hello, Mr. Bruch. I have a couple questions. One on Siemens Gamesa. We have good orders there, EUR 31 billion now, which is melting down now, just because you're getting fewer orders in now compared to revenue. Can you say a word about your orders in terms of onshore and offshore? Have you seen cancellations and delays? Just to get an understanding of what's happening in the wind power business. The free cash flow of Siemens Gamesa in Q3 is still EUR -518 million over 9 months. It's EUR 1.7 billion of the minus cash flow, so a lot of cash burn. Why is that? Why are you still burning cash? Why is it still so extremely high? How is that going to change? When do you expect a cash flow breakeven?

Speaker #1: We have good orders there, €31 billion, which is melting down now. Just because you're getting fewer orders in now compared to revenue.

Speaker #1: Now, can you say a word about your orders in terms of onshore and offshore? Have you seen cancellations or delays? Just to get a sense and better understanding of what's happening in the wind power business.

Speaker #1: Now, the free cash flow of Siemens Gamesa in the third quarter is still minus €518 million. Over nine months, it's minus €1.7 billion.

Christian Bruch: It's EUR 1.7 billion of the minus cash flow, so a lot of cash burn. Why is that? Why are you still burning cash? Why is it still so extremely high? How is that going to change? When do you expect a cash flow breakeven? Second question, you said there are portfolio elements missing in electricity. What portfolio elements would you like to see in the electricity segment? A third question on your forecast. In two areas, you are very much ahead. After 9 months in margin, you already have 12.6%, which is actually much more than the 10% to 12% that you guided for the remainder of the year. For free cash flow, you're at EUR 7.2 billion after 9 months.

Speaker #1: So, cash flow—so a lot of cash burn. Why is that? Why are you still burning cash? Why is it still so extremely high?

Speaker #1: And then, going forward, how is that going to change? So when do you expect a cash flow break-even? Second question: you said there are portfolio elements missing in electricity.

Angela Maier: Second question, you said there are portfolio elements missing in electricity. What portfolio elements would you like to see in the electricity segment? A third question on your forecast. In two areas, you are very much ahead. After 9 months in margin, you already have 12.6%, which is actually much more than the 10% to 12% that you guided for the remainder of the year. For free cash flow, you're at EUR 7.2 billion after 9 months. If you are still guiding for the EUR 8 billion, so for the overall year, it's only EUR 800 million left that you need to rake in in the last quarter. Would you in Q4 expect any collapses in cash flow, but why don't you adjust your guidance?

Speaker #1: So, what portfolio elements would you like to see in the electricity segment? And the third question on your forecast: now, in two areas, we're very much ahead.

Speaker #1: After nine months, in Marjan, you already have 12 left, 12.6%, which is actually much more than the 10 to 12 that you guided for the remainder of the year and for free cash flow.

Speaker #1: You're at €7.2 billion after nine months. So if you are still guiding for the €8 billion for the overall year, it's only €800 million left that you need to rake in in the last quarter.

Christian Bruch: If you are still guiding for the EUR 8 billion, so for the overall year, it's only EUR 800 million left that you need to rake in in the last quarter. Would you in Q4 expect any collapses in cash flow, but why don't you adjust your guidance? Hello, Ms. Meyer. First off, of course, the order backlog will diminish. We're executing it, of course. At our press trip, we talked just about that. 27, 28 is what we currently have on our order books. For 2029, we'll have to obviously make sure that we win new orders for offshore. For offshore, very important. This is also what we tell the federal government in our conversations with them. We're very attentively looking at that, because at some time we need new orders.

Speaker #1: So, would you expect any collapse in cash flow in the fourth quarter? But why don't you adjust your guidance? Hello, Ms. Maya. Now, first off, of course, the order backlog will diminish.

Christian Bruch: Hello, Ms. Meyer. First off, of course, the order backlog will diminish. We're executing it, of course. At our press trip, we talked just about that. 27, 28 is what we currently have on our order books. For 2029, we'll have to obviously make sure that we win new orders for offshore. For offshore, very important. This is also what we tell the federal government in our conversations with them. We're very attentively looking at that, because at some time we need new orders.

Speaker #1: We're executing it, of course. In our press trip, we talked just about that. Twenty-seven, twenty-eight is what we currently have on our order books.

Speaker #1: For '29, we'll obviously have to make sure that we win new orders for offshore—very important. And this is also what we tell the federal government in our conversations with them.

Speaker #1: So we're very attentively looking at that because, at some time, we need new orders. And now, we see projects as such. So we see something is happening.

Christian Bruch: Now we see projects as such, we see something is happening. In terms of Germany, the challenge is that the old auction or bidding conditions were very difficult for companies. There's some discussion now with the German government about addressing this. It would be clear what was originally to be built, and just the conditions are not right at the moment and it doesn't work, therefore. Of course, if that were to continue, that would be a problem at some point when it comes to capacity utilization. Again, it's not a short-term thing, but in the medium term, yes. As far as the portfolio is concerned, we always try to explain this. For grid technologies, we try to broaden our base, especially for digital grids. You may have seen that we purchased Camlin, which is a company that works precisely in this area.

Speaker #1: In terms of Germany, the challenge is that the old auction or bidding conditions were very difficult for companies. And there’s discussion now with the German government about addressing this.

Speaker #1: Because it would be clear what was originally to be built, and just the conditions are not right at the moment. And it doesn't work, therefore.

Speaker #1: But of course, if that were to continue, that would be a problem. At some point, when it comes to capacity utilization—again, it's not a short-term thing.

Speaker #1: But in the medium term, yes. As far as the portfolio is concerned, we always try to explain this. For grid technologies, we try to broaden our base, especially for digital grids.

Speaker #1: You may have seen that we purchased Camlin, which is a company that works precisely in this area. We did the closing just this quarter.

Christian Bruch: We did the closing just this quarter, we continue to work on that and to broaden our portfolio. When it comes to gas services, we try to drive a vertical logic. In this sense, can we make sure, as far as the supply chain is concerned, that we are in robust shape? I think it was two or three quarters ago, we purchased a company in England, CIC, that are producing ceramic cores, just to make sure that our service business is catered to well. Those are investments that are driving our service business on the long end, and there's logic there. Slightly different across the two segments. As far as the cash flow is concerned, please bear in mind that we have a significant CapEx spending in Q4.

Speaker #1: And we continue to work on that, and to broaden our portfolio. When it comes to Gas Services, we try to drive a vertical logic.

Speaker #1: So in that sense, can we make sure, as far as the supply chain is concerned, that we are in robust shape? I think it was two or three quarters ago we purchased a company in England, CIC, that is producing ceramic cores.

Speaker #1: Just to make sure that our service business is catered to well. Now, those are investments that are driving our service business in the long run.

Speaker #1: And there is this logic there, slightly different across the two segments. Now, as far as the cash flow is concerned, please bear in mind that we have significant CapEx spending in the fourth quarter.

Speaker #1: We continue to invest in our plants, out of which a few things will materialize in quarter four. So, those $8 billion, I think, are still a robust guidance.

Christian Bruch: We continue to invest in our plants, out of which a few things will materialize in Q4. Those EUR 8 billion, I think, are still a robust guidance. Breakeven.

Christian Bruch: We continue to invest in our plants, out of which a few things will materialize in Q4. Those EUR 8 billion, I think, are still a robust guidance. Breakeven. Cash breakeven, another question. Yes, I think we mentioned that at the Capital Market Day 2028. I think that's correct. 2028, that's when we expect cash breakeven to occur, and this was quite obvious to us, and this is also influenced by order intake. You have to keep that in mind as well, that is our plan and continues to be the plan.

Speaker #1: Cash break-even—another question, right? Yes, I think we mentioned that at the Capital Market Day. 2028, I think that's correct. 2028, that's when we expect cash break-even to occur.

Christian Bruch: Cash breakeven, another question. Yes, I think we mentioned that at the Capital Market Day 2028. I think that's correct. 2028, that's when we expect cash breakeven to occur, and this was quite obvious to us, and this is also influenced by order intake. You have to keep that in mind as well, that is our plan and continues to be the plan. One more question from the chat. If you want to ask a question over the phone, I see Bloomberg has another question. We'll have that in a minute, then star plus one. From the chat, from Stephan Stahl from the Augsburger Allgemeine. This is a rather general question: Could you explain to us why Siemens Energy is so successful? He wants to know the 5 main success facts. Maybe you can give us 3.

Speaker #1: And this was quite obvious to us. This is also influenced by order intake—you have to keep that in mind as well. But that is our plan, and it continues to be the plan.

Speaker #1: One more question from the chat. If you want to ask a question over the phone, like Bloomberg has another question, we'll have that in a minute.

Tim Proll-Gerwe: One more question from the chat. If you want to ask a question over the phone, I see Bloomberg has another question. We'll have that in a minute, then star plus one. From the chat, from Stephan Stahl from the Augsburger Allgemeine. This is a rather general question: Could you explain to us why Siemens Energy is so successful? He wants to know the 5 main success facts. Maybe you can give us 3.

Speaker #1: Then Star Plus One. And from the chat, a question from Stefan Stahl from the Augsburger Allgemeinen. And this is a rather general question: Could you explain to us why Siemens Energy is so successful?

Speaker #1: He wants to know the five main success factors. Maybe you can give us three. Okay, well, first of all, in the last five years, we've put a lot of effort and work into being good in operational excellence.

Moderator: Well, first of all, in the last 5 years, we've put a lot of effort and work into being good in operational excellence. How do we do things? How do we execute products? How do we reduce some of the costs? How do we carry out effective engineering? That's much more important than many people think. How does a plant work properly? How do we get good productivity and productivity gains? That's the most important thing in order to turn order backlogs into revenue and profit. We've put a lot of work into this, and our employees do an excellent job, and I think this is something that we cannot say often enough. Now, of course, we have a cycle, the electricity cycle. We would call this a super cycle, and this is what we believe will continue.

Christian Bruch: Well, first of all, in the last 5 years, we've put a lot of effort and work into being good in operational excellence. How do we do things? How do we execute products? How do we reduce some of the costs? How do we carry out effective engineering? That's much more important than many people think. How does a plant work properly? How do we get good productivity and productivity gains? That's the most important thing in order to turn order backlogs into revenue and profit. We've put a lot of work into this, and our employees do an excellent job, and I think this is something that we cannot say often enough. Now, of course, we have a cycle, the electricity cycle. We would call this a super cycle, and this is what we believe will continue.

Speaker #1: How do we do things? How do we execute products? How do we reduce some of the costs? How do we carry out effective engineering?

Speaker #1: That's much more important than many people think. How does a plant work properly? How do we get good productivity and productivity gains? That's the most important thing in order to turn order backlogs into revenue and profit.

Speaker #1: We've put a lot of work into this, and our employees do an excellent job. I think this is something that we cannot say often enough.

Speaker #1: Now, of course, we have a cycle—the electricity cycle. We would call this a super cycle, and this is what we believe will continue.

Speaker #1: We're at the beginning of electrification, this major wave of electrification, and we see that the share of electricity in the overall energy demand is growing continuously.

Moderator: We're at the beginning of electrification, this major wave of electrification, and we see that the share of electricity in the overall energy demand is growing continuously. This, of course, drives demand for our products. Now, and this is something that we're trying to achieve, is that what we want is to say for the next few years, we really want to manage to have the best portfolio for this electricity market. That brings me to the third point. I think we've worked well continuously in adjusting our portfolio. Everybody talks about Transformation of Industry, we've continuously been working on this to see we need to do something. Where do we need to do something in order to be in the proper position?

Christian Bruch: We're at the beginning of electrification, this major wave of electrification, and we see that the share of electricity in the overall energy demand is growing continuously. This, of course, drives demand for our products. Now, and this is something that we're trying to achieve, is that what we want is to say for the next few years, we really want to manage to have the best portfolio for this electricity market. That brings me to the third point. I think we've worked well continuously in adjusting our portfolio. Everybody talks about Transformation of Industry, we've continuously been working on this to see we need to do something. Where do we need to do something in order to be in the proper position?

Speaker #1: This, of course, drives demand for our products. And now, and this is something that we're trying to achieve, is that what we want is to say for the next few years, we really want to manage to have the best portfolio for this electricity market.

Speaker #1: And that brings me to the third point. I think we've worked well, continuously adjusting our portfolio. Everybody talks about transformation of industry, but we've continuously been working on this to see if we need to do something.

Speaker #1: Where do we need to do something, and in order to be in the proper position? And this is a lever which we have been able to use well and continuously over the last six years.

Moderator: This is a lever which we have been able to use well and continuously over the last 6 years in a market that is growing. Of course, that is good. For me, it's a question now of taking the long-term aspects, long-term growth and continuous profitability, less a question of from one quarter to the next. Long-term, we want to have a strong, stable, resilient company. Thank you very much. Let's move over to Bloomberg. Marlene Martin, good morning. Good morning. Maybe you could give us some information on free cash flow in terms of structure, it's higher or is this just due to reservation slots? That's my first point. Then on 2027, maybe you could give us some more information on demand. Is this going to continue and what are your expectations there?

Christian Bruch: This is a lever which we have been able to use well and continuously over the last 6 years in a market that is growing. Of course, that is good. For me, it's a question now of taking the long-term aspects, long-term growth and continuous profitability, less a question of from one quarter to the next. Long-term, we want to have a strong, stable, resilient company.

Speaker #1: In a market that is growing, and of course that is good. And for me, it's a question now of taking the long-term aspects—long-term growth and continuous profitability.

Speaker #1: It's less a question of one quarter to the next. Long-term, we want to have a strong, stable, resilient company. Thank you very much. Let's move over to Bloomberg.

Tim Proll-Gerwe: Thank you very much. Let's move over to Bloomberg. Marlene Martin, good morning.

Speaker #1: Marilyn Martin, good morning. Good morning. Maybe you could give us some information on free cash flow in terms of structure. Is it higher, or is this just due to reservation slots?

Marilen Martin: Good morning. Maybe you could give us some information on free cash flow in terms of structure, it's higher or is this just due to reservation slots? That's my first point. Then on 2027, maybe you could give us some more information on demand. Is this going to continue and what are your expectations there? When it comes to order backlog, how much of the order backlog is reservations and how much is this in terms of reservation fees and firm orders? Thank you very much.

Speaker #1: That's my first point. And then, regarding 2027, maybe you could give us some more information on demand. Is this going to continue? And what are your expectations there?

Speaker #1: And when it comes to order backlog, how much of the order backlog is reservations? And how much is this in terms of reservation fees?

Moderator: When it comes to order backlog, how much of the order backlog is reservations and how much is this in terms of reservation fees and firm orders? Thank you very much. Thank you. Well, let me talk about cash flow structure. This is the reflection of order intake and revenue, this reflects our business. I said this in Q4, we also have to consider how much capital is invested, and it's not the same in every quarter because it depends on when we begin and when we complete a project, so that CapEx in one quarter might be clearly higher than in another quarter. This reflects, quote-unquote, the normal structure of our business and good new orders. Now for 2027, we are carrying out the plans right now.

Speaker #1: And firm orders. Thank you very much. Thank you. Well, let me talk about the cash flow structure. This is the reflection of order intake and revenue.

Christian Bruch: Thank you. Well, let me talk about cash flow structure. This is the reflection of order intake and revenue, this reflects our business. I said this in Q4, we also have to consider how much capital is invested, and it's not the same in every quarter because it depends on when we begin and when we complete a project, so that CapEx in one quarter might be clearly higher than in another quarter. This reflects, quote-unquote, the normal structure of our business and good new orders. Now for 2027, we are carrying out the plans right now.

Speaker #1: And this reflects our business. And, as I said in Q4, we also have to consider how much capital is invested. And it's not the same in every quarter.

Speaker #1: Because it depends on when we begin and when we complete a project. So, that CapEx in one quarter might be clearly higher than in another quarter.

Speaker #1: But this reflects, quote-unquote, the normal structure of our business and good new orders. Now, for 2027, we are carrying out the plans right now.

Speaker #1: We see this as positive, and the market will remain so. That's why we are also optimistic when it comes to 2027. Of course, these are our initial observations for Q4.

Moderator: We see this as positive. The market will remain so. That's why we are also optimistic when it comes to 2027. Of course, these are our initial observations for Q4. In November, we'll give you the outlook and guidance for 2027 and medium-term prospects. We hope that you will join us again in November. We can give you more specific information then. Order backlog and reservations. Reservations in the order backlog. No, the reservations are not included in the order backlog. The EUR 162 billion that we have in the order backlog are orders, and what we're trying to do is to not have too much in terms of reservations. That's our strategy. We see more orders than reservations. Not every company does it that way, but that's our approach. Thank you very much. We have a final question from the chat.

Christian Bruch: We see this as positive. The market will remain so. That's why we are also optimistic when it comes to 2027. Of course, these are our initial observations for Q4. In November, we'll give you the outlook and guidance for 2027 and medium-term prospects. We hope that you will join us again in November. We can give you more specific information then. Order backlog and reservations. Reservations in the order backlog. No, the reservations are not included in the order backlog. The EUR 162 billion that we have in the order backlog are orders, and what we're trying to do is to not have too much in terms of reservations. That's our strategy. We see more orders than reservations. Not every company does it that way, but that's our approach.

Speaker #1: In November, we'll give you the outlook and guidance for 2027 and medium-term prospects. So we hope that you will join us again in November.

Speaker #1: We can give you more specific information then. Order backlog and reservations—reservations in the order backlog. No, the reservations are not included in the order backlog.

Speaker #1: The €162 billion that we have in the order backlog are orders. And what we're trying to do is to not have too much in terms of reservations.

Speaker #1: That's our strategy. We see more orders than reservations. Not every company does it that way, but that's our approach. Thank you very much. We have a final question from the chat.

Tim Proll-Gerwe: Thank you very much. We have a final question from the chat. Listen, Recharge wants to know whether the tender in Denmark is a positive one. Well, maybe I can say that every bid that turns into a project is positive for the market anyway. There is a question from ReNew and EnergyWatch. The onshore turbine, SG-7.0, which is the continuation of the 5.X. What about that turbine going forward? What's the plan and what are the sales figures?

Speaker #2: Kristen, Recharge wants to know whether the end in Denmark is a positive one. Well, maybe I can say that every bid that turns into a project is positive for the market anyway.

Moderator: Listen, Recharge wants to know whether the tender in Denmark is a positive one. Well, maybe I can say that every bid that turns into a project is positive for the market anyway. There is a question from ReNew and EnergyWatch. The onshore turbine, SG-7.0, which is the continuation of the 5.X. What about that turbine going forward? What's the plan and what are the sales figures? Just an outlook on the onshore market. Now for the 4.X and the 5.X, we have successor models. 4.X, obviously the successor to the 4.X in sales numbers is higher. SG-7 is currently launching now, just because there have been a number of customer or approval processes, until they turn out to be orders. I'm still talking about smaller selling numbers at the moment, but a lot of discussion ongoing relating to them.

Speaker #2: But there is a question from Renews and Energy Watch. The onshore turbine SGZ710, which is the continuation of the 5X—what about that turbine going forward?

Speaker #2: So, what's the plan? And what are the sales figures? Just an outlook on the onshore market. Now, for the 4X and the 5X, we have successor models for the 4X.

Christian Bruch: Just an outlook on the onshore market. Now for the 4.X and the 5.X, we have successor models. 4.X, obviously the successor to the 4.X in sales numbers is higher. SG-7 is currently launching now, just because there have been a number of customer or approval processes, until they turn out to be orders. I'm still talking about smaller selling numbers at the moment, but a lot of discussion ongoing relating to them.

Speaker #2: Actually, the successor to the 4X in sales numbers is higher. SG7 is currently launching now, just as well, because there have been a number of customer or approval processes.

Speaker #2: Until they turn out to be orders. So, I'm still talking about smaller selling numbers at the moment. But there's a lot of discussion ongoing relating to them.

Speaker #2: And across the different countries, we see future projects that will obviously make a contribution to this. But what I'm saying is we're just at the beginning of that whole process.

Christian Bruch: Across the different countries, we see future projects that will obviously make a contribution to this. What I'm saying is we're just at the beginning of that whole process. I'm very positive, though. The turbine is going down really well, very positively with our customers in the market, but it takes time and that's the challenge. Thank you very much. We have one more question from n-tv coming in a second. We need to wrap up. You'll be live with n-tv in a moment so people can tune in there. Thank you very much to everyone for joining and for your interest. If you have more questions, my press team and myself are available. Please talk to us. I need to apologize again for our technical glitches we've had before. Analyst call with Christian Bruch and our CFO, Maria Ferraro, already begins at 10:00 AM today.

Speaker #2: I'm very positive, though. The turbine is going down really well—very positively—with our customers in the market. But it takes time, and that's the challenge.

Speaker #2: Thank you very much. We have one more question from NTV coming in in a second, but we need to wrap up. You'll be live with NTV in a moment.

Tim Proll-Gerwe: Thank you very much. We have one more question from n-tv coming in a second. We need to wrap up. You'll be live with n-tv in a moment so people can tune in there. Thank you very much to everyone for joining and for your interest. If you have more questions, my press team and myself are available. Please talk to us. I need to apologize again for our technical glitches we've had before. Analyst call with Christian Bruch and our CFO, Maria Ferraro, already begins at 10:00 AM today. Please dial in. You cannot ask questions. You'll find the link on our website. The next regular meeting for journalists is our annual press conference on 11 November. That's not long. Before that, I'd like to wish you a great holiday season. I'll be on vacation soon. Thank you very much and have a great day.

Speaker #2: So people can tune in there. Thank you very much to everyone for joining and for your interest. If you have more questions, my press team and myself are available.

Speaker #2: Please bear with us, and I want to apologize again for our previous technical glitches. Our analyst call with Christian Bruch and our CFO, Maria Ferraro, will begin at 10:00 o'clock today.

Speaker #2: So please dial in, but you cannot ask questions. You'll find the link on our website. The next regular meeting for journalists is our annual press conference on the 11th of November.

Moderator: Please dial in. You cannot ask questions. You'll find the link on our website. The next regular meeting for journalists is our annual press conference on 11 November. That's not long. Before that, I'd like to wish you a great holiday season. I'll be on vacation soon. Thank you very much and have a great day. Ladies and gentlemen, this is the end of the conference call. Thank you very much for attending. Goodbye

Speaker #2: So, that's not long, but before that, I'd like to wish you a great holiday season. I'll be on vacation soon. Thank you very much.

Speaker #2: And have a great day.

Speaker #1: Meine Damen und Herren, die Telefonkonferenz ist nun beendet.

Operator: Ladies and gentlemen, this is the end of the conference call. Thank you very much for attending. Goodbye