SAP shares drop as macro uncertainty hits client confidence
By Benjamin Chiou
Date: Wednesday 23 Jul 2025
(Sharecast News) - German software giant SAP posted stronger-than-expected profits for its second quarter, but cloud revenues came in shy of analysts' estimates amid fears that global trade uncertainty was causing clients to delay spend.
In an earnings call with analysts, the company said that public-sector clients in the US and manufacturing firms exposed to higher tariffs were showing caution in regards to cloud investments.
Total revenues were up 9% year-on-year at €9.03bn, under the €9.09bn expected by the market, with a 24% jump in cloud revenues to €5.13bn not enough to meet the €5.18bn pencilled in by analysts.
However, operating profits more than doubled to €2.46bn from €1.22bn the year before, ahead of the €2.43bn consensus forecast.
SAP reiterated its guidance for 2025, forecasting 26-28% constant-currency growth in cloud revenues to €21.6bn-21.9bn and operating profit growth of 26-30% to €10.3bn-10.6bn.
"As we move into the second half, we remain cautiously optimistic, keeping a close eye on geopolitical developments and public sector trends," said chief financial officer Dominik Asam.
The stock was down 3.1% at €251.50 by 1103 CEST.
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