Another sign of China’s tepid recovery came from German industrial conglomerate Siemens, which pinned disappointing sales on the lackluster economy.
Siemens said it swung to a fiscal third-quarter profit of €1.28 billion ($1.59 billion), as revenue rose 6% to €18.89 billion. A company-compiled consensus called for earnings of €1.41 billion on sales of €19.27 billion.
Orders rose by 10% to €24.24 billion, which topped the €22.19 billion expected by analysts.
Siemens shares
SIE,
slumped by 4% in afternoon trade in Germany.
“China’s market recovery in manufacturing is materializing slower than expected and we anticipate some further subdued development,” said CEO Roland Busch.
The company flagged that new orders in China deteriorated in the second half of the quarter, particularly in automation.
But the good news for Siemens is the problems in China have yet to translate to key exporters, either in its home market of Germany or in Italy. The company reiterated its organic sales growth guidance for the fiscal year even as it lowered its outlook in particular for the digital industries segment.
“China is clearly a lot weaker than expected, and while the execution looks stronger than peers such as Rockwell or Schneider, investor focus is expected to be on demand development into FY24,” said Bank of America analysts led by Alexander Virgo.
This story originally appeared on Marketwatch
