SAP Expects Sales Growth to Accelerate Through Next Year on Strong Cloud Business

By Mauro Orru

German business-software group SAP said it expects revenue growth to accelerate through 2027 as customers increasingly ditch software-support services in favor of the cloud.

Reporting on a non-IFRS basis, the company behind the Concur travel and expense management platform closed 2025 with total revenue of 36.80 billion euros, equivalent to $44 billion, up 11% at constant currencies. In the fourth quarter alone, revenue grew 9% to 9.68 billion euros, with its cloud business logging 26% growth in sales to 5.61 billion euros.

Chief Executive Christian Klein said significant current cloud backlog growth in the quarter had set the stage for an acceleration in constant-currency total revenue growth through next year.

The company said it would launch a new share repurchase program of up to 10 billion euros that is expected to start in February this year and close by the end of 2027.

The announcement comes after SAP reported a quarterly net profit of 1.89 billion euros, up from 1.63 billion euros a year earlier. Operating profit--a closely watched metric for software companies--increased to 2.83 billion euros from 2.44 billion euros, generating an operating margin of 29.2%.

Analysts had forecast quarterly total revenue of 9.70 billion euros, cloud revenue of 5.60 billion euros and an operating profit of nearly 2.74 billion euros on a 28.2% operating margin, according to a non-IFRS consensus provided by the company.

SAP, like other European software companies, presents its figures as two sets of numbers. One set is based on the International Financial Reporting Standards--an international accounting method that seeks to provide a global reporting standard--though analysts and investors tend to follow SAP's non-IFRS numbers, which exclude restructuring expenses and acquisition-related charges.

For 2026, SAP expects non-IFRS operating profit between 11.9 billion euros and 12.3 billion euros, cloud revenue of 25.8 billion euros to 26.2 billion euros and free cash flow of roughly 10 billion euros.

Write to Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

January 29, 2026 00:54 ET (05:54 GMT)