Key Highlights
- First quarter non-IFRS earnings per share reached €1.72, surpassing the analyst consensus of €1.65
- Revenue for the quarter increased 6% compared to last year, reaching €9.55 billion
- Cloud business revenue jumped 19% to €5.96 billion, exceeding Wall Street projections of €5.89 billion
- Cloud backlog expanded 20% to reach €21.9 billion
- The company maintained its 2026 cloud revenue forecast of €25.8–€26.2 billion, subject to specific conditions regarding Middle East stability and the Reltio transaction
Shares of SAP’s American depositary receipts surged 7.7% to $175.74 during premarket hours on Friday, bouncing back from Thursday’s 6.2% decline that followed disappointing sentiment across the software sector after IBM and ServiceNow reported earnings.
$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 enterprise software leader from Germany delivered first quarter non-IFRS earnings of €1.72 per share, exceeding analyst projections of €1.65. Revenue for the period totaled €9.55 billion, representing a 6% increase year-over-year.
The standout performance came from cloud operations. Revenue from this segment reached €5.96 billion, marking a 19% year-over-year increase and slightly surpassing Wall Street’s €5.89 billion forecast.
Additionally, the company reported a cloud backlog of €21.9 billion at quarter’s end, representing a 20% increase from the prior year period. This backlog metric provides insight into future revenue that remains to be recorded.
Operating profit on a non-IFRS basis rose to €2.87 billion from €2.46 billion in the year-ago quarter, beating the consensus forecast of €2.71 billion.
The previous day’s 6.2% decline in SAP shares occurred amid broader software sector weakness. The sector faced selling pressure following earnings reports from IBM and ServiceNow that disappointed investors, despite both companies delivering respectable results.
The strong premarket bounce on Friday indicates investors responded more positively to SAP’s performance when evaluated independently.
2026 Guidance Unchanged, But With Caveats
The company reaffirmed its 2026 cloud revenue target range of €25.8 billion to €26.2 billion. SAP also indicated that total revenue growth in constant currencies should remain comparable to 2025 levels, with stronger acceleration anticipated in 2027.
However, two important qualifications accompany this forecast. The company’s pending acquisition of Reltio, a data management platform provider, must successfully close—anticipated sometime during the second or third quarter. Additionally, geopolitical tensions in the Middle East region need to ease.
Chief Financial Officer Dominik Asam highlighted concerns about potential disruptions in the Strait of Hormuz as a significant risk element. Speaking to Barron’s, he stated: “We don’t see too long of a continuation of the shutdown of the Strait of Hormuz,” while acknowledging that extended disruption could impact worldwide supply chains and economic expansion.
He offered a pragmatic observation, noting: “In such a meltdown scenario, SAP is probably the lesser of your concerns in terms of exposure in capital markets.”
Cloud Operations Power Growth Trajectory
The cloud division has served as SAP’s primary growth catalyst for multiple years, partially driven by increasing enterprise adoption of artificial intelligence solutions. The first quarter’s 19% revenue expansion maintains this momentum.
The €21.9 billion cloud backlog represents committed future revenue streams awaiting recognition on financial statements.
With a market capitalization of $192.38 billion as of Thursday’s closing bell, SAP holds the position as Europe’s most valuable technology company.
The Reltio transaction, unveiled in March, remains subject to regulatory approval and is projected to finalize during the second or third quarter of 2026.
