On January 29, SAP shares fell nearly 15%, marking the steepest one-day decline since October 2020, after the company disclosed that its current cloud contract backlog grew by 16% in Q4 2025—down from 25% a year earlier—due to longer deal cycles for large transformational projects and new termination-for-convenience clauses. Investors reacted sharply as SAP projected full-year 2026 cloud revenue growth of 23% to 25%, slightly below last year’s 26% pace, raising concerns over the outlook for its key software-as-a-service segment.

SAP reported Q4 non-IFRS earnings per share of €1.62, up 16% year-over-year, surpassing analysts’ expectations, and generated cloud revenue of €5.61 billion, a 26% increase at constant currencies. Total Q4 revenue reached €9.68 billion, up 9% at constant currencies, while non-IFRS operating profit climbed 21% at constant currencies to €2.83 billion, reflecting strong margin expansion in cloud gross profit, which rose 27% at constant currencies to €4.18 billion.

For the full fiscal year, SAP delivered total revenue of €36.8 billion, up 11% at constant currencies, and cloud revenue of €21.02 billion, up 26%, with cloud ERP Suite sales growing 32% at constant currencies to €18.12 billion. Non-IFRS operating profit for 2025 increased 31% at constant currencies to €10.42 billion, while free cash flow nearly doubled to €8.24 billion, driven by disciplined cost management and strong subscription renewals, raising the more predictable revenue share to 86%.

SAP announced a new two-year share repurchase program of up to €10 billion, reinforcing confidence in its balance sheet and future cash generation. CEO Christian Klein emphasized the company’s focus on integrating AI into core business processes through its Business AI offerings—embedded in two-thirds of Q4 cloud order entries—and pointed to record total cloud backlog of €77.3 billion, up 30% at constant currencies, as the foundation for accelerating revenue growth through 2027.