SAP, Europe’s largest software maker, said today it was more optimistic about its financial results this year due to accelerating growth in revenue from cloud computing.
The group said it expects operating profit in 2025, on a constant currency basis, to be between €10.3 billion and €10.6 billion.
SAP previously said its 2025 “ambition” was for operating profit of about €10.2 billion, total revenue of more than €37.5 billion and more than €21.5 billion in cloud revenue.
The company said it now expects cloud revenues to be slightly higher in a range of €21.6 billion to €21.9 billion for the year.
Fourth-quarter cloud revenue grew 27%, adjusted for currency effects, to €4.71 billion, beating an analyst consensus of €4.67 billion posted on the company’s website.
The cloud and software revenue in the quarter grew 11% adjusted for currency effects, to €8.27 billion, beating an analyst consensus of €8 billion.
Quarterly operating income, adjusted for special items, gained 24% to €2.44 billion in the fourth quarter, above an analyst consensus of €2.25 billion.
The software maker has previously said up to 10,000 jobs out of its 100,000 total headcount were under review as it prepares for the era of AI, projecting restructuring costs of around €3 billion
SAP shares dropped yesterday alongside other European technology stocks after the popularity of a Chinese discount artificial-intelligence model, DeepSeek, wobbled investors’ faith in the profitability of AI and related investments.
