Consolidated Profit Drops by 20% in 2025

German industrial giants Verbund and Siemens are both grappling with significant profit declines in 2025, revealing troubling trends within the nation’s energy and manufacturing sectors. A combination of factors – including reduced hydropower generation and rising raw material costs – is contributing to a worrying downturn for both companies. These results are already raising alarms about Germany’s economic stability and future growth.

Verbund’s profit drop stems primarily from a dramatic 24.2% decrease in hydropower output, largely attributed to drought conditions impacting reservoir levels across Austria and Germany. This reduction in renewable energy generation has directly impacted Verbund’s core business model, which relies heavily on hydropower revenue. Simultaneously, Siemens’ struggles are rooted in broader macroeconomic pressures, with escalating costs for materials like steel and semiconductors contributing to a slowdown in global demand for their products, particularly in the industrial automation sector. Experts believe this situation could trigger a ripple effect throughout Germany’s industrial base, potentially leading to further job losses and investment uncertainty. The combined impact of these challenges underscores the vulnerabilities of Germany’s economy as it navigates the energy transition and global economic headwinds.

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