Siemens experienced a surge in Q1 orders, causing its shares to rise sharply. The German engineering and technology group announced the boom on Thursday. Orders surged 52%, according to the company, which also makes trains and factory software.
The surge is attributed to customers stocking up on equipment as demand increases in anticipation of the slowing pandemic.
CEO Roland Buch told reporters that the company had seen an unprecedented boom. In early trading, the company’s shares gained 6.4%. Siemens is one of the largest capital goods manufacturers. It supplies equipment to factories and reflects the broader economy because of its unique position.
Anxious to get products
The global industry has been slow since the post-pandemic upturn saw a components shortage, particularly semiconductors chips, while supply chains experienced congestion and delays.
Products like cars, electrical equipment, and other products became harder to get for consumers. Since then, there has been a lot of pre-ordering by customers who would like to get their hands on these products.
According to Busch, Siemens was doing its best to deal with the problems, although some customers had to wait longer than usual to get their deliveries.
A massive order backlog
Siemens reported that it now has an order backlog of 93 billion Euros, the highest ever level, leading to delays. Busch even said that the company has not escaped unscathed even as the good fortune flows in.
Revenue and profit experienced a surge in China, Germany, and Italy.
The company signed contracts for new trains, and there was high demand for software used to make integrated circuits and printed circuit boards.
Industrial profit rose 12% to reach 2.46 billion euros in Q1 (Ended Dec. 31), ahead of forecasts that said 2.27 billion euros. Net profit went up 20% to reach 1.8 billion euros from revenue that went up 17% (to reach 16.50 billion euros) ahead of forecasts (15.95 billion euros)