SAP’s Cloud Backlog Surges Past Expectations, but Acquisition Costs Force a Guidance Trim
Published on 07/24/2026 at 19:12 | Redaktion boerse-global.de
A single trading session laid bare the split personality of Germany’s blue-chip index. While SAP staged a sharp recovery on stronger-than-expected cloud metrics, the broader DAX told a story of two speeds — technology and financials surging, autos sliding deeper into the red.
SAP’s stock jumped 7.71 percent to €139.48 on Friday, rebounding from the previous day’s close of €129.50. The move snapped a grim stretch that had left the shares trading near a 52-week low of €127.52. Yet even after the bounce, the stock remains down 33.05 percent year-to-date and has shed 42.78 percent over the past twelve months — a reminder that the recovery is more of a relief rally than a confirmed trend reversal.
The catalyst was a cloud backlog that swelled to nearly €23 billion in the second quarter, climbing 27 percent year-over-year. That figure, a key leading indicator of future revenue, comfortably beat analyst expectations. Cloud revenue itself grew 24 percent, underscoring the momentum behind SAP’s subscription-based pivot.
Chief Executive Christian Klein pointed directly to artificial intelligence as a growth driver. In the quarter’s 50 largest deals, AI products and the SAP Business Data Cloud appeared in over 90 percent of cases, he noted — a signal that the company’s technology stack is increasingly embedded in customers’ digital transformation plans.
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But the headline cloud strength came with a catch. Adjusted earnings per share of €1.59 missed the consensus estimate of €1.75, while net profit of €2.21 billion came in ahead of forecasts. The earnings miss, combined with the cost of two recent acquisitions, prompted SAP to trim its full-year outlook.
The company now expects currency-adjusted operating profit growth of 13 to 17 percent, down from the previously guided range of 14 to 18 percent. The revision reflects the near-term drag from the acquisitions of data platform Dremio and AI startup Prior Labs. Chief Financial Officer Dominik Asam acknowledged that both units are expected to generate losses in the second half of the year as integration costs weigh on margins.
Despite the guidance cut, analysts largely took the quarter in stride. KeyBanc reaffirmed its buy rating with a price target of €235, arguing that SAP’s forward price-to-earnings ratio of roughly 19 for 2026 makes the stock look reasonably valued after the selloff.
The initial market reaction was telling. SAP shares actually dipped immediately after the earnings release, as traders focused on the profit miss and the lowered outlook. Only after the dust settled did the cloud backlog numbers — and the broader narrative of a business accelerating toward recurring revenue — win the day.
Chart watchers remain cautious. The stock’s 52-week low of €127.52, touched just days earlier, still looms as a potential retest point. Friday’s surge pushed the shares back above a key support level, but the long-term trend remains firmly bearish. For a sustainable turnaround, SAP will need to show that the Dremio and Prior Labs integrations start contributing to — rather than detracting from — earnings growth.
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The broader sector context added to the positive sentiment. Oracle, another enterprise software heavyweight, gained 2.73 percent to €108.44 after the Pentagon awarded the company a contract worth up to $7 billion over ten years. The base agreement covers $3.31 billion over the first five years, with an extension option that could double the total value. The deal follows a similar consolidation contract Microsoft won in May, worth $9.69 billion.
For SAP, the Oracle news reinforced a broader theme: enterprise software spending, particularly in areas tied to cloud migration and AI, remains resilient even as macroeconomic uncertainty weighs on other parts of the technology sector.
The question now is whether SAP can sustain the momentum. The cloud backlog provides a strong visibility buffer, but the margin pressure from acquisitions and the broader cost of investing in AI capabilities will test investor patience. With the stock still deep in negative territory for the year, Friday’s rally feels more like a reprieve than a resolution.
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