SAP Lifts Cloud Guidance to Top of Range as Backlog Growth Faces a Fourth-Quarter Test
Published on 10/24/2026 at 12:51 | Editorial boerse-global.de
SAP has nudged its full-year cloud revenue target toward the upper end of its existing corridor, betting that a €24.1 billion contract backlog can carry momentum through December — even as management itself flags a possible slowdown in the pace of new bookings.
The Walldorf-based software group now aims for the top of its 2026 cloud revenue range of €25.8–26.2 billion. It stopped short of opening a new, higher bracket. The same logic applies to cloud and software revenue, where SAP is steering toward the upper end of €36.3–36.8 billion. The earnings outlook was left untouched.
Backlog and Revenue Both Point Upward
The Current Cloud Backlog — the contracted cloud business yet to be recognized as revenue — reached €24.1 billion in the third quarter of 2026, a 28% increase. Cloud revenue itself rose 26%, or 25% at constant currencies, to €6.67 billion. Total revenue for the quarter came in at €10.27 billion, up 13%, while operating profit climbed 18% under both IFRS and Non-IFRS.
Those two data points tell slightly different stories, and both matter. The backlog captures business already signed; the revenue line shows what has actually been billed. Together they suggest the expansion is broad-based rather than a one-off spike in contract signings.
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A Caveat Buried in the Optimism
Management paired its brighter revenue ambition with a warning: growth in the cloud backlog could decelerate slightly in the fourth quarter. That is a statement about the rate of expansion, not about any contraction in the order book — a distinction worth keeping in mind. Still, it caps expectations for further acceleration.
The stock felt that tension. According to media reports, profit-taking after a prior rally weighed on the shares, compounded by weakness across the technology sector and cautious analyst commentary on the near-term monetization of artificial intelligence.
Brokers Lean Positive, With Goldman Out in Front
Sell-side reactions were largely constructive. Goldman Sachs raised its price target to €258 from €230 and reiterated its buy rating, with analyst Mohammed Moawalla pointing squarely at the strength of the Current Cloud Backlog and predicting SAP would continue to outpace rivals. Other analysts praised the cloud transformation and the commercial traction of SAP's AI offerings.
Barclays' Sven Merkt highlighted growing AI products as a catalyst driving customers into the cloud. That argument extends beyond the reported quarter — though it comes without hard figures on SAP's own AI revenue, which limits how far the bullish case can be quantified.
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The Real Scorecard Arrives in January
SAP plans to publish preliminary results for the fourth quarter and the full 2026 financial year on 28 January 2027. For investors, the headline number to watch is the cloud backlog and whether its growth rate holds.
The tension between a strong quarter just delivered and a year-end pace that may ease is what will define the verdict on SAP's finish to the year. Management has signaled a possible slight deceleration; the latest figures still show robust growth. How durable the raised expectations prove to be will be measured against that gap.
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