SAP SE gained more than six years after the most valuable Europe company has informed the first quarter profits, which topped the analysts, which its axis fed on cloud services.
German -based Woldlorf said in a statement on Tuesday that the modified operating income increased by 58 % of fixed currencies to 2.5 billion euros (2.9 billion dollars). This compares with an average estimate of 2.24 billion euros by analysts collected by Bloomberg.
SAP shares increased by up to 11 % in Frankfurt on Wednesday, the largest jump during the day since April 24, 2019. The stock increased by 36 % during the past year, and its value was valued by Novo Nordisk A/S and LVMH in March.
The SAP ENTERSE Resources Planning program – used to hold notebooks, purchases and human resources – generally requires customers to subscribe to a contract, and throw a stable revenue flow. CEO Christian Klein said in an interview on Bloomberg TV that about 86 % of SAP sales were repeated revenues in the past quarter, which helped to isolate the SAP of economic turmoil and fears of the American recession.
“Customers come to SAP with the need to focus on saving real costs, SaP can clearly meet SAP needs with the nature of important software,” wrote Deutsche Bank, including Gianmarco Conti, wrote in a note. They said that SAP has “strength and flexibility despite the uncertainty of the peak macro.”
The cloud revenues in fixed currencies increased by 26 % to 4.99 billion euros, compared to an estimate of 5.05 billion euros. SAP confirmed the forecast for cloud revenue for 2025, at a value of 21.6 billion euros to 21.9 billion euros. However, the company said that “the dominant dynamic environment means high levels of uncertainty and reduce vision.”
The current cloud accumulation, which reflects the sales that will be booked over the next 12 months, has grown 29 % in fixed currencies to 18.2 billion euros.
SAP has also begun to repair companies with job discounts in early 2024, which helped enhance profits.
The gains came in a positive global background after US President Donald Trump suggested that he could retract his strong trade position on Beijing. A wider measure of Asian stocks was more than 1 %.
Although SAP is not directly affected by American definitions, its customers may already interact with economic uncertainty. Growth slowed in each of the licensing and cloud subscription companies in the first quarter, according to a survey this month from 30 SAP distributors conducted by Morgan Stanley analysts. The slowdown by the United States was its largest market.
What Bloomberg intelligence says:
The 27.2 % average SAP operating margin shows about 250 basis points above consensus, that its aggressive clouds over the past 2-3 years are mature, which overwhelms slight losses on sales gains. The growth of the current cloud accumulation of 29 % shows in the continuous currency, as well as reaffirming its goals for 2025, a minimal mark on the obstacle of increased uncertainty. – BI analysts Anurag Rana and Andrew Gerard
“We see a very strong pipeline in the United States,” Klein said, despite recession. “What we do not see yet is that they delay projects or even cut projects.”
Klein gave priority to the company’s transformation into a cloud business model based on subscription, as the average spending for each customer is higher. Under its leadership, the company promotes artificial intelligence services in the cloud to motivate customers to shift from old servers on the site.
SAP, which competes with Salesforce Inc. Less directly affected by the American commercial barriers than some other European technology giants. Asml Holding NV, which until October was the most valuable on the continent, informed orders in the first quarter in the past week, which was nearly a billion euros without expectations and warned of the impact of the recent tariff ads.
This story was originally shown on Fortune.com
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2025-04-23 10:01:00
