SAP (NYSE:SAP) Releases Earnings Results, Beats Estimates By $0.13 EPS

SAP (NYSE:SAP) announced its earnings results on Thursday. The software maker reported $1.89 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.76 by $0.13, Zacks reports. SAP had a return on equity of 15.69% and a net margin of 19.50%.

Here are the key takeaways from SAP’s conference call:

• Strong 2025 financials — SAP beat its outlook on operating profit and cash flow, delivered cloud revenue +26% and said Q4 was the year’s best bookings quarter.
• AI and Business Data Cloud are driving deals — Management said BDC exceeded €2bn of order entry since launch and that roughly two‑thirds of large deals include AI, citing wins at H&M and Fresenius as proofs of value.
• Near‑term backlog / CCB timing risk — Current cloud backlog grew more slowly (≈25%) and management flagged a deal mix skewed to very large, sovereign/complex transactions that lengthen ramping and reduce near‑term CCB contribution.
• Cash strength and shareholder returns — FY2025 free cash flow was ~€8.2bn, management guides to ~€10bn for 2026 and announced a new €10bn two‑year share buyback while keeping the option open for targeted AI/data M&A.

SAP Stock Down 15.3%

SAP stock traded down $36.16 during trading hours on Thursday, hitting $199.95. The stock had a trading volume of 6,514,645 shares, compared to its average volume of 2,353,352. The stock’s 50-day moving average price is $240.82 and its 200-day moving average price is $261.36. The stock has a market capitalization of $287.40 billion, a P/E ratio of 29.99, a price-to-earnings-growth ratio of 2.79 and a beta of 1.18. SAP has a 12-month low of $195.12 and a 12-month high of $313.28. The company has a quick ratio of 1.10, a current ratio of 1.11 and a debt-to-equity ratio of 0.14.

Key Stories Impacting SAP

Here are the key news stories impacting SAP this week:

• Positive Sentiment: Q4 earnings beat: SAP reported $1.89 EPS vs. $1.76 expected, with strong margins and ROE that show core profitability remains healthy. SAP quarterly earnings and call materials
• Positive Sentiment: Share buyback: SAP announced a new two-year repurchase program of up to €10 billion, which supports shareholder returns and offsets some dilution risk. SAP Quarterly Statement Q4 2025
• Positive Sentiment: Cloud demand and backlog at record levels in absolute terms — SAP reported a large cloud backlog and multi‑year cloud growth, evidence that AI-related customer spending is lifting cloud bookings overall. SAP cloud bookings jump 30%
• Neutral Sentiment: Top-line met estimates: SAP said Q4 revenue met market forecasts and provided slide deck and call materials for details — mixed signals between headline beats and underlying forward metrics. SAP meets Q4 revenue forecasts
• Negative Sentiment: Cautious cloud guidance / backlog concerns: Management’s forward comments and certain backlog metrics were seen as softer than investor hopes, prompting questions about growth trajectory and timing of cloud monetization. This cautious tone was a proximate cause of the selloff. US software stocks slide after SAP, ServiceNow results fuel AI disruption fears
• Negative Sentiment: Market reaction and sector contagion: SAP’s cautious tone combined with weak post‑earnings moves at peers (ServiceNow, Microsoft cloud softness) sparked sector-wide AI competition fears and a steep share drop — the largest daily fall since 2020. SAP shares set for biggest daily drop since 2020
• Negative Sentiment: Rising short interest and governance noise: Short interest rose sharply in January and SAP dismissed three executives amid a report of leaked o9 trade secrets — added downside pressure from positioning and governance/legal uncertainty. Q4 press conference call transcript Stolen o9 trade secrets? SAP dismisses three executives

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently bought and sold shares of the company. Riggs Asset Managment Co. Inc. boosted its stake in SAP by 83.8% during the second quarter. Riggs Asset Managment Co. Inc. now owns 147 shares of the software maker’s stock worth $45,000 after buying an additional 67 shares during the period. JPL Wealth Management LLC purchased a new position in shares of SAP in the third quarter worth about $49,000. Larson Financial Group LLC grew its stake in shares of SAP by 19.4% during the 3rd quarter. Larson Financial Group LLC now owns 308 shares of the software maker’s stock worth $82,000 after purchasing an additional 50 shares during the period. Palisade Asset Management LLC acquired a new stake in SAP in the 3rd quarter valued at $84,000. Finally, Binnacle Investments Inc increased its holdings in SAP by 14.2% in the 3rd quarter. Binnacle Investments Inc now owns 338 shares of the software maker’s stock worth $90,000 after acquiring an additional 42 shares in the last quarter.

Wall Street Analysts Forecast Growth

A number of brokerages recently weighed in on SAP. Weiss Ratings reissued a “buy (b-)” rating on shares of SAP in a report on Friday, October 31st. KeyCorp restated an “overweight” rating on shares of SAP in a research note on Thursday, October 23rd. Citigroup reaffirmed a “buy” rating on shares of SAP in a report on Thursday, December 11th. TD Cowen reissued a “buy” rating on shares of SAP in a research report on Thursday, October 23rd. Finally, Morgan Stanley reaffirmed an “overweight” rating on shares of SAP in a research report on Friday, October 31st. Two research analysts have rated the stock with a Strong Buy rating, fourteen have issued a Buy rating and two have issued a Hold rating to the company’s stock. According to MarketBeat.com, the company currently has an average rating of “Buy” and a consensus target price of $280.20.

About SAP

SAP SE is a global enterprise software company headquartered in Walldorf, Germany. Founded in 1972 by five former IBM engineers, the company’s name is an acronym for Systeme, Anwendungen und Produkte in der Datenverarbeitung (Systems, Applications & Products in Data Processing). SAP develops and sells software and services that help organizations manage business processes across finance, human resources, procurement, manufacturing, supply chain and customer relationships.

SAP’s product portfolio spans on‑premises and cloud offerings, anchored by its enterprise resource planning (ERP) solutions such as SAP S/4HANA and the SAP HANA in‑memory database and platform.