Good morning. Welcome everyone. We are here to talk about growth—sustainable, profitable growth, and importantly, accelerated growth. Just look at what we have done in the last five years since we became a focused technology company. This was our growth trajectory starting fiscal year 2021 until fiscal year 2025: average revenue growth 8% per year, up from 2% in the previous decade. Average profit margin of our industrial business 15%, up from 10%. And average free cash flow margin 13%, up from 7%. The total shareholder return of 151%. We outperformed the DAX and other indices. Higher growth, higher margins, higher free cash flows.
This successful performance continues. So let's take a look at our most recent past fiscal year 2025. It was another record year for Siemens. Our orders reached 88 billion euros, 6% above prior year's level. Revenue grew by 5%, a total of 78.9 billion euros, and a book-to-bill ratio of 1.1—a high-quality backlog of 117 billion euros. We move with confidence in our fiscal year 2026.
Our industrial business showed a strong performance—a record profit of 11.8 billion euros. Our free cash flow at a new historic high: 10.8 billion. This means we turned 14% of sales straight into cash, with 10.4 billion euros record net income for the third consecutive year. And finally, we achieved earnings per share pre PPA of €10.71. We achieved this in spite of substantial uncertainties all around the world: geopolitics, new tariffs and protectionism, slow consumer spending. We created substantial value for all our stakeholders.
Now let's take a look at the performance of our industrial businesses. Let's start with Digital Industries. We met the guidance as we did with all our businesses. Revenue declined by 4% as we had predicted because of the difficult market environment for our automation business and against a very strong base of comparison for our software business. Profit margin 15.9%. This excludes effects related to Altair, which were not part of our guidance. Smart Infrastructure: 9% revenue growth. They delivered at the upper end of the guided range, and profit margin was even more impressive at 18.3%—an all-time record and above guidance. Mobility: 10%, the upper end of the guided range. Excellent execution. There is a huge backlog of orders and the team is just producing and delivering. They successfully balance risk and opportunities—the result is industry-leading profitability and free cash flow.
Siemens today is stronger than ever. Our strategy works. We grow by combining the real and the digital worlds. And our ambition keeps growing too. With our One Tech Company program, we are making changes to the fabric of our company and unlocking even higher growth in the future. When we talk about our fabric, there are two important aspects: one is the portfolio, and the other is our operating model. Our operating model supports and strengthens our businesses with world-class technologies and services, higher efficiency, and a huge set of high-quality industrial data, so that our businesses can innovate faster and serve customers even better.
Let's take these two aspects one by one. Our portfolio: in the last five years, we have put particular focus on streamlining it, preparing ourselves for the transformation—both through divestments and high-growth acquisitions. In 2020, we spun off Siemens Energy. In the following years, we divested our so-called portfolio companies—companies for which Siemens was no longer the better owner. Six years ago, their total valuation was estimated at €1.5 billion. In the end, our proceeds from these divestments totaled 7 billion euros. Focus on where we can create the most value, also through disciplined acquisitions. Along our strategy to combine the real and the digital worlds, we acquired intelligent hardware companies—for example, industrial drive technologies, switchgear, Dunos, Fire Safety, and in India for electrical and electronic equipment.
On top, we strengthened our digital business with three SaaS acquisitions, all cloud-native. Skills—a provider for inventory management, reservation, and ticketing software for our rail customers. Supply Frame—a platform that connects design and sourcing of electronic parts. Brightly—a provider for asset and maintenance solutions for buildings. And in 2025, we closed the acquisitions of Altair and Drawatics. With Altair, Siemens now has the world's most complete portfolio for AI-powered design, engineering, and simulation. Our customers can now build the most comprehensive physics-based digital twins. And with Drawatics, we are adding more than 5 billion to our addressed markets. Our customers can now build a digital thread all the way from R&D to production, helping them bring medicines and biochemicals to the market more quickly and at lower cost.
Now we make another important step towards a highly synergistic Siemens portfolio. We plan to deconsolidate Siemens Healthineers. This will unlock long-term value for all our shareholders because it will allow both companies to tap fully into their respective growth potentials. Siemens Healthineers is a success story. Since its IPO, the company has grown from 13 billion euros in revenue in 2018 to 23 billion euros in 2025. And the Varian acquisition contributed approximately 4 billion to this. Industry-leading margins, a best-in-class product offering, reliable cash flow, high free cash flow conversion—a strong, attractive business, but one with increasingly less synergies. Siemens Healthineers serves markets which are increasingly different from the core markets of Siemens. For example, regulation in healthcare is comprehensive and increasing. Digitalization in the way that we do it at Siemens today doesn't really scale into the healthcare sector. Through the planned deconsolidation, Siemens Healthineers will benefit from a significantly higher free float—a leading pure-play medtech champion, more attractive for the capital market.
So what happens now? We intend to transfer 30% of shares to Siemens Healthineers shareholders by a direct spin-off, and as a minority shareholder we will continue to participate in the attractive business of Siemens Healthineers. In the medium term, we intend to reduce our shareholding to a financial asset. The transaction still needs regulatory clarification and a green light from both shareholder meetings, and more details will follow in early Q2 calendar year 2026. And let me assure you, Siemens is committed to managing its investments in Siemens Healthineers in a responsible and shareholder-focused manner.
A new Siemens has taken shape—a company with less complexity and simplified governance, with a fast-growing digital business, with an unmatched portfolio of industrial software and digital services, and with a strong portfolio in hardware—connected hardware that will be increasingly software-defined and enhanced with AI. In short, a Siemens with a highly synergistic portfolio, ready to scale. Portfolio matters, but there's more to our fabric than the mix of our businesses. When we say we are changing our fabric, we also mean we are improving our operating model. Remember: stronger customer focus, faster innovations, higher profitable growth. Siemens is a strong company with a rich history, but this means legacy too. Too many systems, ERP systems, still many silos—data silos. Every single bit of this legacy made sense at a certain point in time, but times have changed. The world has become more competitive. Companies need to be more resilient. Scale matters more and more. Speed matters more and more. We are giving our businesses an efficient, optimal environment so they can focus, innovate faster, and serve our customers better. And that's what our new operating model is all about.
We are building and rolling out services for all of our businesses—highly standardized, delivered in highly efficient ways, always up to date with the latest technology and at world-class quality for everyone, at Siemens scale. We do that because the world is squeezing out small players. Digital tools allow us to use economies of scale in every possible way. Scale matters for data. Scale matters for AI. Scale matters when you want to be a powerful partner in a global ecosystem. And that's why we are creating one data fabric, one technology fabric, and one sales fabric for all of Siemens. Let's look at these fabrics one by one to see how they help our businesses grow faster.
Let's start with one data fabric for all of Siemens. We are tearing down walls and bringing data where it belongs—together. One ERP system, one CRM system, one data layer for internal data, customer data, external data, all connected, available in real time. Today, our customers can already use 250 data products, and with our data we are feeding our AI models. And because scale matters, our customers and partners want to connect into our data fabric. We started with the machine tool industry. Seven companies joined an alliance to pool data.
So one data fabric. Next is one technology fabric. This means technologies and services which our businesses need for their success. We build them once for everyone at world-class level—one set of technology building blocks. Take for example our software-as-a-service business. We can create the supporting infrastructure once—login, distributing, patching, cybersecurity—and do that for all our SaaS offerings. The specific applications on top are the differentiator and create the value for our customers. Or take software engineering. Today we have 30,000 software engineers. They use roughly 900 separate versions of software development tools. We plan to consolidate these into just a few dozen standardized tools. This will boost productivity. And one industrial foundation model—I will talk about that later.
Finally, number three: one sales fabric. Let me be clear here. For different markets, Siemens will still have different go-to markets. We address them through six sales organizations: for automation, buildings, electrical products, electrification and automation for mobility, and for software. The important part is all of these sales teams are using the same sales fabric. What does that mean? Shared tools at lower cost, rigorously standardized, data-driven for full transparency, real time, orchestrated by stringent account management, channel and partner management. Siemens will sell with one digital marketplace, one sales tool set, one vertical approach. Just to give you a simple example: all six teams have started using one and the same digital identifier for customers. This increases transparency and visibility. We see in real time and holistically what each customer wants and buys—but also what they do not buy yet from us. That's where we are unlocking more and more sales opportunities. More standardization means less back office work. In automation, for example, we are doubling the share of salespeople who carry a quota. In short, with greater transparency, we can allocate resources better, and this will help us grow faster.
So now, where will growth come from? First of all, we are in a good place because we are offering what the world needs and we are positioned along secular growth drivers: automation, digitalization, electrification, sustainability, and artificial intelligence—AI for the real world. Let's have a look at our markets. Our addressed markets grow at approximately 6% per year on average. And in five years' time, this adds up to a total addressable market of €650 billion. The digital markets therein grow much faster—by 11%—to 175 billion euros by 2030. In addition, we are tapping into expansions of our total addressable market. They are adding up to 50 billion in fiscal year 25, but we expect them to grow between 14 and 18% per year on average until 2030. These are very attractive growth areas for us—they include new AI applications and products, AI factory capabilities, life science software, just to name some examples. And we are able to address these markets organically, and we will of course also evaluate opportunities for partnerships or acquisitions. In short, our addressed markets are growing, and we are addressing market expansions which are even growing faster.
Siemens is accelerating its growth. At our capital market day 2019, we said 4 to 5%—we delivered. At our capital market day in 2021, we said 5 to 7%—we delivered again. And here is our new midterm ambition: 6 to 9% comparable revenue growth. This is our expectation only for our existing portfolio, excluding Siemens Healthineers. Any growth from total addressable market expansions is not reflected in this ambition. And of course, we aspire not just growth, but profitable growth—growth that translates into strong earnings per share. Our midterm ambition here is EPS pre PPA, high single-digit increase.
Now let's zoom in and look at actual growth levers. What are we doing strongly to tap into our growth markets and opportunities? There are four big levers: grow digital, grow regions, grow vertical, and grow AI. Let's take them one by one.
First, grow digital. In 2021, we had committed to an average annual growth rate of 10% for our digital businesses, which consist of software, IoT, and digital services and consulting services. And we delivered—our digital business grew by 12% and reached 9.4 billion euros in 2025, including acquisitions. Now we expect our growth to increase further: 15% on average per year over the next five years. This means we expect this part of our business to double in revenue by 2030. How do we grow in this area? Of course, software is a big part of this, and especially recurring revenue from software as a service. Take our successful SaaS business in Digital Industries—we grew the annual recurring revenue with an average growth rate of 13% year-over-year to now 5.3 billion euros. All in all, for our SaaS business model in PLM, we won 24,000 customers. Seven out of 10 are new customers. Almost nine out of 10 are small and medium enterprises. For many of these smaller companies, this easier, faster access makes them choose Siemens software actually for the first time.
And there is Siemens Accelerator, our open digital business platform. It helps us reach small and medium-sized enterprises through our marketplace and of course with SaaS offerings. It helps us sell more effectively into verticals and to tailor offerings through digital threads. Here are five examples for how it is gaining market traction.
First, Manufacturing X—industrial operations. In one of their plants, Audi replaced physical controllers with virtual controllers from Siemens. The result: more flexibility, higher speed, lower cost. Audi will roll this out to all their factories. Currently, we are piloting the virtual PLC with half a dozen further customers. Building X—we help lower operational costs, which are the lion's share of a building's costs. With data-driven optimization, customers can save up to 30% of energy and generate up to 10% more operating income. Signaling X—interlocking in the cloud. Instead of physical signs at the side of the track, we offer virtual signaling in the cloud. We have done this for Norway, Finland, Austria, and Barcelona. And yesterday we announced this will also work for mass transit in Singapore. It scales. Grid Scale X—many electricity grids are at their limits. Thanks to our software products, grid operators can increase their capacity by up to 30% without upgrading existing hardware. And the last example is Teamcenter X.
We launched the Digital Reality Viewer. What is that? Running on Siemens Accelerator and powered by NVIDIA Omniverse and GPUs, it lets customers explore complex products photorealistically and in 3D to speed up collaboration. The next level will bring one unified, immersive, and highly realistic digital twin to factories. And Foxconn, one of the largest contract manufacturers in the world, will be the first user. Foxconn is building a state-of-the-art robotic facility for manufacturing NVIDIA AI infrastructure systems. With labor shortages and skills gaps, digitalization, robotics, and physical AI are more important than ever.
Which brings us to lever two: grow regions. Siemens is both a global and a local company at the same time. We are present almost everywhere on the planet, and we grow where markets are growing and where markets grow particularly fast. We double down increasingly on our investments. The focus countries for us: United States, China, and India. This broad footprint also increases our resilience. When tariffs or trade restrictions come up, we can buffer their impact—most of our competitors cannot. This supports our growth relative to the market. Here's the CAGR for our addressable markets over the next five years in these three regions: United States about 6%, China nearly 4%, India more than 7%. These figures exclude the Healthineers market. Here's how Siemens fits into their respective growth stories.
The United States wants to strengthen its critical infrastructure, reshore manufacturing, and keep boosting its AI capabilities. We invested nearly 1 billion in the United States in the last two years. This includes an expansion of our local footprint in manufacturing for electrical products. We are transforming public transport with the first high-speed link between Los Angeles and the Las Vegas area with locally manufactured trains. We are a partner for hyperscalers and their massive buildout of data centers. More on this in the deep dives later. We are offering software for production optimization for small and medium-sized enterprises—it can enhance their shop floor performance by 30%.
Let's move to China. China is moving up the value chain with high-tech manufacturing, building out its digital infrastructure, and the country wants to strengthen its position as a global leader in AI. We keep providing high-end automation in China. But we also started building value products for the local market—specified locally, manufactured locally, developed locally, and sold locally, and with China speed. In the last year, we have seen 18 new automation products and we have more than 20 new products in the pipeline for the next year. We see great potential for Siemens Accelerator in the Chinese market—more than half a million registered users in China and over 400 offerings by now.
India. India wants to boost domestic and export-oriented manufacturing, and the country is rapidly building up AI infrastructure and rail infrastructure across the whole country. Siemens is upgrading the country's transportation sector. Recently, we started full production of our locally manufactured electric locomotives. 1,200 are on order, including a 35-year full-service maintenance contract. This is a 3 billion contract in total. We bought C&S Electric, a local manufacturer for low-voltage equipment. They have been growing with a CAGR of 20%. And for medium voltage, we started manufacturing the environmentally friendly gas-insulated switchgear in India as well. We were awarded Best Multinational Company of the Year in 2025.
And yes, there are opportunities in Europe too. We continue to invest in Germany for its world-class industrial ecosystem, strong small and medium-sized companies, outstanding talent, and research. We invested 250 million euros to upgrade Europe's most modern train factory in Munich. And we even started building our 500 million euro Technology Campus in Erlangen, which will bring the industrial metaverse to life.
Lever number three: grow verticals. Verticals are becoming more important for Siemens because our new fabric allows us to serve them even better. What we can do since it's a smaller view on a market: we identify recurring customer problems and resolve them in repeatable offerings. In other words, this is another great potential to scale. Here is the expected market CAGR for five growth verticals over the next five years: rail transportation 5%, aerospace and defense 9%, life science 9%, semiconductors 10%, and data centers and AI 11%. Our target is to consistently grow faster than these respective markets.
A bit more on the five verticals. Let's start with data centers. Our revenue has increased to €2.9 billion euros, with growth in 2025 of 40%. Our customers are building the next generation of data centers—now to AI factories. Larger, denser, higher energy intensity. Through this vertical, we bring everything we already have to offer, and we are developing new offerings too—from advanced building management automation with PLCs, DC switching for efficient power, and of course full digital twin simulation all the way from the chip to the building. Life science: nine out of 12 top pharma companies rely on both Smart Infrastructure and Digital Industries offerings. We integrate what they typically need, and with Drawatics we expand into software for their R&D processes. Rail transportation: we are technology leaders in many areas, including rolling stock, signaling, and cloud and AI-based predictive maintenance. Our ability to support with financing solutions is an additional advantage. We expect to benefit also from government stimulus programs.
We will take a deep dive on these three verticals in the afternoon, and we have an exhibition you might want to enjoy. Let me share more on the following two: aerospace, defense, and semiconductors. In aerospace, we support our partners in using fewer resources and help them develop more sustainable aircraft. 95% of the world's aircraft engines are developed and manufactured with Siemens software. 90% of satellites in orbit have been developed with Siemens software. Defense budgets are growing globally with a CAGR of approximately 7% between 2025 and 2030, and we have been a trusted technology partner for this industry for a very long time. Semiconductors: globally, semiconductor companies plan to invest about $1 trillion through 2030 in new fabrication plants. 29 out of 30 semiconductor companies rely on Siemens technology. Our automation and design software enables the production of 2-nanometer chips. We offer high-precision building technologies for clean rooms.
Now lever number four: grow AI. More specifically, we talk about industrial AI. This is not really new to Siemens—we have been developing AI-based tools and products for more than 50 years. Today, we have 1,500 AI experts all around the world. We use AI in three big ways: to boost innovation and productivity, to enhance our products, and we're also building our own new AI offerings.
First, AI to boost our innovation speed and productivity. We are using applications from Google for AI-powered improvement of our code. For example, for software-defined automation—this is really genuine code programming. The same tools help us dramatically speed up our bids for complex projects, train projects for example. We can shorten tender applications from weeks to hours. Secondly, powering our existing products with AI. Today we have 38 AI offerings and their number keeps growing. Two examples: AI that finds the best production path for machine tools—this will be possible thanks to our data alliance with the machine tool industry we talked about. We use Anthropic's model Claude to refactor our own software. In simple terms, AI cleans up and simplifies code. This makes both our software and the hardware it connects faster and more performant. Concrete benefits for our TIA Portal software: customers profit from updates faster and with higher quality.
And third, we are building new AI products. Siemens is developing an industrial foundation model with our domain know-how and with the vast industrial data we have, including those from our partners. This model will speak the language of engineers. It will ingest any kind of industrial data. We're also working on AI agents—industrial agents that plan, think, use tools, and cooperate with humans to achieve clear goals. We are doing this with our partner AWS. Our award-winning Industrial CoPilot is already used by a number of customers. It offers up to 30% higher productivity in factories, and we developed it together with Microsoft.
For the AI opportunity, let me introduce our team with Vasi Filippin. He joined us a few months back from AWS. You will get to know him later in the breakouts. He is scaling an AI development center in Seattle, connected to our AI and domain experts all over the world. This is super important: bring domain know-how and AI and data together. In the next three years, we will invest more than 1 billion euros in our AI capability and offerings. And we will work even more closely with our partners. Don't mix up 1 billion with hundreds of billions in data centers. This is not investment in infrastructure. This is making this infrastructure work for industrial AI. This is where this 1 billion goes.
Now, one example: NVIDIA and Jensen Huang, their CEO, sent us this video message. Enjoy—it takes approximately 3 minutes.
