Quick Summary

  • SAP delivered Q1 non-IFRS earnings per share of €1.72, surpassing the analyst consensus of €1.65
  • Total quarterly revenue reached €9.55 billion, representing a 6% annual increase
  • Cloud revenue climbed 19% to €5.96 billion, exceeding Wall Street’s €5.89 billion projection
  • Cloud backlog expanded 20% to reach €21.9 billion
  • The company reaffirmed its 2026 cloud revenue target of €25.8–€26.2 billion, contingent on Middle East conditions and the Reltio acquisition

Shares of SAP’s American depositary receipts climbed 7.7% to $175.74 during premarket hours on Friday, rebounding from Thursday’s 6.2% decline that came amid broader software sector weakness following results from ServiceNow and IBM.

The European enterprise software leader posted first-quarter non-IFRS earnings of €1.72 per share, surpassing the €1.65 analyst consensus. Overall revenue totaled €9.55 billion, reflecting a 6% year-over-year increase.

Cloud revenue emerged as the standout metric. The segment generated €5.96 billion, marking a 19% annual gain and slightly exceeding Wall Street’s €5.89 billion forecast.


SAP Stock Card
SAP SE, SAP

The enterprise software company concluded the first quarter with a cloud backlog valued at €21.9 billion, representing a 20% increase from the prior-year period. This backlog metric provides visibility into contracted revenue awaiting recognition.

Non-IFRS operating profit rose to €2.87 billion from €2.46 billion in the year-ago quarter, beating the consensus estimate of €2.71 billion.

Thursday’s 6.2% drop in SAP shares occurred alongside widespread selling across the software sector. Market participants reduced exposure to the group following earnings releases from IBM and ServiceNow that disappointed despite solid underlying fundamentals.

Friday’s premarket strength indicates investors viewed SAP’s quarterly performance more positively when evaluated independently.

Company Reaffirms Long-Term Guidance With Qualifications

SAP preserved its 2026 cloud revenue forecast range of €25.8 billion to €26.2 billion. Management indicated that total revenue growth in constant currencies should mirror 2025 levels, with stronger momentum anticipated in 2027.

Two specific conditions accompany this forward guidance. The company’s pending acquisition of data management provider Reltio must complete—anticipated during Q2 or Q3. Additionally, the Middle East conflict requires de-escalation.

CFO Dominik Asam highlighted disruption risks in the Strait of Hormuz during investor discussions. “We don’t see too long of a continuation of the shutdown of the Strait of Hormuz,” he explained to Barron’s, emphasizing that extended disruption could impact global supply chains and economic growth.

He offered perspective with characteristic understatement: “In such a meltdown scenario, SAP is probably the lesser of your concerns in terms of exposure in capital markets.”

Cloud Operations Remain Central to Growth Strategy

SAP’s cloud division has served as the primary growth catalyst for multiple years, benefiting from rising enterprise AI implementation. The 19% revenue expansion in the first quarter extends this trajectory.

The cloud backlog—currently standing at €21.9 billion—represents committed future revenue that remains to be recorded on financial statements.

SAP holds the position as Europe’s largest technology company by market capitalization, with a valuation of $192.38 billion as of Thursday’s market close.

The Reltio transaction, unveiled in March, awaits regulatory approval and is projected to finalize during the second or third quarter of 2026.