Siemens Energy says customers paying to reserve gas turbines amid record demand

Siemens Energy Says AI Boom and Iran War Drive Record Gas Turbine Demand

Siemens Energy CEO Christian Bruch said demand for gas turbines has grown so intense that European customers are paying reservation fees to secure spots in production queues, as the company reported record quarterly orders driven by the artificial intelligence data center boom and post-conflict electrification needs tied to the Iran war.

Record Orders and Reservation Fees

Siemens Energy’s Gas Services division achieved its highest quarterly order intake ever in the second quarter of fiscal year 2026, with orders reaching €8.9 billion — a 32% increase on a comparable basis. The surge was “mainly driven by demand from the U.S. in connection with data centers as well as orders from power additions in Europe (e.g. Poland),” the company said in its earnings release on May 12.siemens-energy

Customer advance payments, including reservation fees, drove free cash flow pre-tax to €1,975 million in the quarter, up 42% year-over-year. Reservation fees, which Siemens Energy introduced to manage surging demand, have become standard practice in the gas turbine market as manufacturers face production backlogs stretching years into the future. Major manufacturers are now advising developers to plan seven to eight years ahead for turbine procurement.linkedin

Iran War Compounds Energy Strain

The conflict with Iran, which disrupted energy infrastructure across the Middle East earlier this year, has added further pressure to already tight supply. Strikes on facilities in Saudi Arabia and Qatar triggered volatility in global energy markets, while Europe confronts rising energy costs and accelerated electrification timelines as a result.thesoufancenter

The Siemens Energy earnings release noted “customer reluctance in the Middle East” at its Transformation of Industry segment, but the broader effect of the conflict has been to increase demand for new power generation capacity globally. The company raised its full-year revenue growth outlook to 14-16% and now expects net income of around €4 billion.siemens-energy

GE Vernova Shares Climb on Analyst Upgrades

The turbine demand surge has also buoyed GE Vernova, whose shares rose nearly 4% on June 11. The stock has benefited from a wave of analyst upgrades, with Jefferies raising its price target to $1,350 from $965 in April while maintaining a Buy rating. The mean Wall Street price target now stands around $1,216, implying roughly 30% upside. GE Vernova’s stock has surged more than 70% in 2026, driven by AI-related power demand from hyperscalers.marketscreener

Bruch told a Columbia University forum in May that the U.S. electricity market is “the hottest in the world,” with Siemens Energy committing $1 billion to expand American manufacturing capacity as part of a broader $7 billion global expansion.columbia