Siemens Healthineers posts strong Q2 results; adjusted basic earnings per share range widened for outlook due to tariffs

Original from: Siemens Healthineers

Siemens Healthineers AG today announces its results for the second quarter of fiscal year 2025 ended March 31, 2025.

Q2 Fiscal Year 2025

• V ery good equipment book-to-bill ratio of 1.14

• Strong comparable revenue growth of 6.8%

• Imaging comparable revenue growth of 8.7%; very good adjusted EBIT margin of 22.4%

• Diagnostics comparable revenue growth of 1.0%; adjusted EBIT margin of 6.3%

• Varian comparable revenue growth of 12.5%; adjusted EBIT margin of 13.2% mainly due to extraordinarily high

equipment revenue share

• Advanced Therapies comparable revenue growth of 3.7%; very good adjusted EBIT margin of 18.5%

• Overall adjusted EBIT margin of 16.6%, clearly above prior-year quarter

• Free cash flow of almost €200 million, clearly above prior-year quarter

• Adjusted basic earnings per share of €0.56, above prior-year quarter

Updated Outlook for Fiscal Year 2025

We confirm our expectation of comparable revenue growth of between 5% to 6% compared with fiscal year 2024.

Due to the geopolitical developments – in particular trade barriers and increased tariffs on a wide range of countries – we now assume an expanded range of between €2.20 and €2.50 (previously €2.35 to €2.50) for adjusted basic earnings per share.

Bernd Montag, CEO of Siemens Healthineers AG:

”We continued our strong start to the fiscal year in the second quarter. While the fundamental growth drivers remain intact, we expect that the significantly increased volatility of the geopolitical environment will weigh on our business this year. That leads us to widen our guidance range for adjusted basic earnings per share for fiscal 2025, while keeping our revenue growth outlook unchanged.”

Revenue rose by 6.8% in the second quarter of fiscal year 2025 to around €5.9 billion. The Imaging and Varian segments, in particular, contributed to this strong revenue growth.

From a geographical perspective, the Americas region achieved significant comparable revenue growth, the Asia Pacific Japan region very strong growth, and the China region slight growth. The EMEA region showed a slight revenue decline after very strong growth in the prior-year quarter.

Equipment order intake in the second quarter markedly exceeded equipment revenue. The equipment book-to-bill ratio was a very good 1.14.

Adjusted EBIT rose by 19% to around €982 million in the second quarter from the prior-year period. This resulted in an adjusted EBIT margin of 16.6%, also higher than in the prior-year quarter. In particular, contributions from strong revenue development as well as cost reductions related to the transformation program of the Diagnostics business had a positive effect.

Net income was €537 million, up 25% from the prior-year period. The tax rate was 27%, above the low 20% rate in the prior-year quarter.

Adjusted basic earnings per share rose slightly to €0.56 from €0.55 in the prior-year period. Higher earnings contributions from the operating business were impacted by lower net financial income as well as higher tax expenses.

Free cash flow reached almost €200 million, clearly above the prior-year quarter.

In the Diagnostics segment, revenue in the second quarter rose by 1.0% on a comparable basis to around €1.1 billion.

In the Asia Pacific Japan region, revenue rose strongly on a comparable basis. Revenue also rose strongly in the China region, here in comparison with a strong decline in revenue in the prior-year quarter. Meanwhile, Diagnostics revenue development in the EMEA region was flat and, in the Americas region, it declined slightly.

The segment’s adjusted EBIT margin of 6.3% was clearly above the prior-year quarter. The margin development was driven in particular by cost reductions related to the transformation program.

Outlook

The geopolitical developments that occurred in the second quarter of fiscal year 2025 and continue to persist, in particular trade barriers and increased tariffs on a wide range of countries, have a negative impact on our business development in fiscal year 2025.

For fiscal year 2025, we nevertheless continue to expect comparable revenue growth of between 5% and 6% over fiscal year 2024.

For adjusted basic earnings per share, we now assume an expanded range of between €2.20 and €2.50 (previously €2.35 to €2.50) to account for the increased uncertainty.

The outlook is based on several assumptions. This includes the expectation that the current macroeconomic environment, including the regulations with regards to trade tariffs currently in force and planned for implementation as well as the interest rate level, will remain largely unchanged.

Based on our assumptions, the trade barriers and tariffs will have slightly negative impacts on the growth dynamics of individual segments and will reduce the adjusted EBIT margins of all segments in the second half of the fiscal year.

In addition, the outlook is based on assumptions about exchange rate developments, which currently lead to a slightly positive currency effect on the expected adjusted basic earnings per share for fiscal year 2025 compared with fiscal year 2024. Furthermore, this outlook excludes potential portfolio measures.

The outlook is based on the number of shares outstanding at the end of fiscal year 2024. This outlook also excludes additional charges from legal, tax and regulatory issues and framework conditions.

Source: Siemens Healthineers posts strong Q2 results; adjusted basic earnings per share range widened for outlook due to tariffs