Siemens CFO: Political uncertainties are affecting customer decisions

Ralf Thomas, chief financial officer at Siemens, said that customers are hesitant to buy Siemens products due to the political uncertainty. However, he doesn't expect this situation to continue.

Thomas stated that companies are delaying investment decisions because they are worried about tariffs, and whether ESG (environmental, social, and governance) risks will still be important after President Donald Trump's attacks.

Thomas said at a Bank of America Conference in London that "whenever there is uncertainty on a political level, it translates into paralysis among decision makers."

He added: "We are seeing this in many places at the moment. Not only the U.S., but also other geopolitical areas and tensions relating to the political climate." "They won't accelerate the decision-making processes anytime soon."

Thomas added that Siemens still believed the long-term demand was "ok" for its products, and also said it had a large order backlog totaling 118 billion euro ($129 billion).

Thomas said that if uncertainty lasted for one or even two quarters it would be a "different ballgame," though he didn't expect this to happen.

Siemens said in February that it was expecting revenue growth between 3% and 7% for this year.

Thomas confirmed that the company has set its guidance for each division for the second quarter. This runs until the end of the month of March.

Siemens is struggling with weak demand, especially in countries like Germany and China. On Tuesday, it announced that it would be cutting 8% of its jobs at the industrial automation division to keep up with lower sales.

Thomas stated that the industrial demand in China - Siemens' third largest market - is now normalising thanks to its electric car manufacturers.

Thomas stated that Siemens continued to sell its stake in Siemens Energy. The company now holds 12% of the shares, down from 14.3% by the end 2024.

(source: Reuters)