Key Highlights
- First quarter non-IFRS earnings per share reached €1.72, surpassing the €1.65 consensus forecast
- Overall revenue climbed 6% on a yearly basis to €9.55 billion
- Cloud segment revenue jumped 19% to €5.96 billion, exceeding the €5.89 billion Street projection
- Cloud backlog expanded 20% to reach €21.9 billion
- The company reaffirmed its 2026 cloud revenue target of €25.8–€26.2 billion, subject to specific conditions
American depositary receipts of SAP soared 7.7% to $175.74 during Friday’s premarket session, recovering from Thursday’s 6.2% decline that came amid a broader software sector downturn triggered by disappointing reactions to ServiceNow and IBM quarterly reports.
$SAP Q1’26 EARNINGS HIGHLIGHTS
🔹 Revenue: €9.56B (Est. €9.53B) 🟢; +6%, +12% cc
🔹 Adj. EPS: €1.72; +20%
🔹 Cloud: €5.96B (Est. €5.90B) 🟢; +19%, +27% cc
🔹 Cloud & Software: €8.55B (Est. €8.47B) 🟢; +8%, +14% cc
🔹 Current Cloud Backlog: €21.9B; +20%, +25% constant…— Wall St Engine (@wallstengine) April 23, 2026
The Walldorf, Germany-based enterprise software leader delivered first quarter non-IFRS profits of €1.72 per share, exceeding analyst projections of €1.65. Overall revenue reached €9.55 billion, representing a 6% increase compared to the prior-year quarter.
The standout metric was cloud performance. The segment generated €5.96 billion in revenue, marking a 19% year-over-year increase and marginally outpacing Wall Street’s €5.89 billion forecast.
Additionally, SAP concluded the first quarter with a cloud backlog totaling €21.9 billion, representing a 20% year-over-year expansion. This metric provides insight into future revenue streams already secured through customer contracts.
Non-IFRS operating income rose to €2.87 billion from €2.46 billion in the year-ago period, surpassing the €2.71 billion consensus projection.
The stock’s 6.2% decline on Thursday was part of a widespread software industry retreat. Market participants sold off technology stocks following quarterly reports from IBM and ServiceNow that underwhelmed investors despite delivering respectable financial results.
Friday’s premarket surge indicates that traders responded more positively to SAP’s specific performance metrics.
2026 Guidance Reaffirmed With Stipulations
The company stood by its 2026 cloud revenue projection range of €25.8 billion to €26.2 billion. Management also indicated that total revenue growth in constant currency terms should mirror 2025 levels, with stronger momentum anticipated in 2027.
However, two important qualifications accompany this forecast. The company’s pending Reltio acquisition must successfully close—anticipated during the second or third quarter. Additionally, the geopolitical situation in the Middle East needs to improve.
Chief Financial Officer Dominik Asam specifically highlighted potential disruptions in the Strait of Hormuz as a concern. “We don’t see too long of a continuation of the shutdown of the Strait of Hormuz,” he explained to Barron’s, warning that extended disruption could impact worldwide supply chains and economic expansion.
With characteristic understatement, he remarked: “In such a meltdown scenario, SAP is probably the lesser of your concerns in terms of exposure in capital markets.”
Cloud Segment Remains Primary Growth Driver
The cloud division has served as SAP’s primary expansion catalyst for multiple years, partially driven by enterprise adoption of artificial intelligence solutions. The first quarter’s 19% revenue growth maintains this momentum.
The €21.9 billion cloud backlog represents committed future revenue streams that have not yet been recognized on financial statements.
With a market capitalization of $192.38 billion as of Thursday’s trading close, SAP holds the position as Europe’s most valuable technology company.
The Reltio transaction, which was unveiled in March, awaits regulatory approval and is projected to finalize during the second or third quarter of 2026.
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