Innovation strategy affects the development direction and results of firm innovation, but its evolution path in the process of digital transformation is still unclear. Taking Siemens (China) as the research object, this paper uses the longitudinal single case study method to analyze the evolution path of innovation strategy in the process of digital transformation from the perspective of dynamic capabilities. The results show that in the exploration, growth and acceleration stages of digital transformation, firm realizes the evolution of innovation strategy under the impetus of different dynamic capabilities. Among them, driven by digital identification capabilities, innovation strategy mainly manifests as exploitative innovation strategy, driven by digital integration capabilities, innovation strategy mainly manifests as exploratory innovation strategy and exploitative innovation strategy, and driven by digital reconstruction capabilities, innovation strategy mainly manifests as exploratory innovation strategy. This paper reveals the internal process of digital transformation and the evolution path of innovation strategy driven by dynamic capability through longitudinal single case study. This study is expected to expand the application of dynamic capability theory in digital context, deepen the research on innovation strategy from an evolutionary perspective, and provide theoretical support and path guidance for firms to effectively use dynamic capability to promote digital transformation and formulate innovation strategy.