Comment by jansan
10 hours ago
Siemens Energy (which meanwhile is completely separated from Siemens) did a massive cleanup of their management overhead two or three years ago. They cut several layers and a lot of managers got downgraded or let go. Looking at their stock performance it seems they did the right thing.
I really hope that other German enterprises will use this as an example.
As I was following Siemens Energy in these years, I remember them getting a huge bailout, or you can call it help or whatever, at one point and from there on the stock price started going up.
It was a government guarantee in November 2023, which was never used, but allowed them to borrow money from banks for new projects. Demand was never a problem, but they were on the brink of collapse due to hidden quality problems at their subsidiary Gamesa. Somehow they seem to have solved this.
How is stock performance any indication of a company having too many managers.
It isn't. Stock price just measures investor confidence. Sometimes firing managers leads to more investor confidence. Most of the time it's a crapshoot but it's the best objective indicator we have for comparison.
It means their financials improved