- SAP’s second quarter non-IFRS revenue was reported at €9.03 billion, closely aligning with the estimated €9.07 billion.
- Non-IFRS cloud and software revenue stood at €7.97 billion, slightly below the expected €7.99 billion.
- The non-IFRS cloud revenue was €5.13 billion, compared to the forecast of €5.17 billion.
- Cloud revenue, when measured in constant currencies, increased by 28%, surpassing the estimate of 25.4% growth.
- Non-IFRS gross profit reached €6.64 billion, just under the projected €6.66 billion.
- The company’s non-IFRS operating profit was €2.57 billion, outperforming the expected €2.43 billion.
- Profit after tax was significantly higher than expectations at €1.75 billion compared to the forecast of €1.55 billion.
- The non-IFRS earnings per share (EPS) came in at €1.50, exceeding the estimate of €1.44.
- Free cash flow was notably strong at €2.36 billion, surpassing the predicted €1.43 billion.
- SAP anticipates a slight deceleration in current cloud backlog growth at constant currencies in 2025.
- Analyst recommendations include 26 buy ratings, 5 hold ratings, and 3 sell ratings.
SAP on Smartkarma
Analysts on Smartkarma, such as Gregory Ramirez, are providing bullish outlooks on SAP’s future. Ramirez’s research reports highlight SAP’s strategic moves at Sapphire 2025, where the company revealed plans to unify its cloud platform with AI to drive efficiency gains and revenue growth. The introduction of the Business Suite as a cloud-based platform, along with embedded AI, aims to streamline operations and improve scalability. Despite industry uncertainties, SAP’s expertise and infrastructure position it well to lead in the AI-driven enterprise software landscape.
In another report, Ramirez discusses SAP’s partnership with Databricks and the launch of the SAP Business Data Cloud. This collaboration aims to integrate structured and unstructured data, enhancing SAP’s AI capabilities and addressing data silos. The move towards unifying data sources and leveraging advanced AI and machine learning technologies reflects SAP’s commitment to innovation and staying ahead in the competitive market. With a focus on operational efficiency, cloud revenues, and AI enhancements, SAP is setting ambitious targets for growth and profitability in the coming years.
A look at SAP Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 2 | |
| Growth | 4 | |
| Resilience | 4 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on Smartkarma Smart Scores, SAP is positioned well for long-term growth with strong scores in Growth, Resilience, and Momentum. With a Growth score of 4, the company is showing promising potential for expanding its market presence and increasing revenue over time. The Resilience and Momentum scores of 4 further indicate that SAP is able to withstand market fluctuations and is currently experiencing positive performance trends.
SAP’s Value and Dividend scores, although lower at 2 each, could be areas for improvement. However, given the company’s focus on innovation and strong market positioning, SAP’s overall outlook remains positive. As a multinational software company specializing in business software development and services, SAP continues to showcase its expertise in e-business and enterprise management software on a global scale, providing a solid foundation for future growth and success.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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