Morningstar

SAP shares get punished for slight miss on backlog

Provided by Dow Jones

By Steve Goldstein

SAP shares slumped on Thursday.

Shares of SAP were hammered on Thursday as the German software giant reported slower backlog growth than expected in the fourth quarter and also guided to a slight deceleration this year.

The numbers weren't by any stretch bad - at constant currencies, the cloud backlog was 25% in the fourth quarter, but that was worse than consensus which was closer to 26%. For 2026, it expects a slight deceleration from the 25% produced last year.

SAP said "large transformational deals" will have cloud revenue ramps in future years, and that termination clauses required by law weighed on cloud backlog growth by 1 percentage point.

The company's fourth-quarter profit rose 17% to EUR1.9 billion, as sales rose 3% to EUR9.68 billion . CFO Dominik Asam said the company closed the quarter on a high note, with operating profit and free cash flow ahead of its own expectations.

SAP also said it'll buy back up to EUR10 billion in stock.

SAP shares (XE:SAP) (SAP)slumped 9% in early Frankfurt trade, to take this year's losses to 14%.

"Q4 was good, except the current cloud backlog, but that's unfortunately the most important line," said analysts at Metzler.

-Steve Goldstein

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal. 




  (END) Dow Jones Newswires



  01-29-26 0358ET


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