SAP shares surge after cloud backlog beats expectations

SAP ↘ 0.03% shares surged more than 6% on Friday after the German software giant's second-quarter cloud contract backlog topped analyst expectations, offering relief to investors who had watched the stock lose a third of its value in 2026.

Cloud Momentum Accelerates

The company's current cloud backlog reached €22.9 billion, a 27% year-over-year increase that marked an acceleration from the first quarter and countered fears of a slowdown in cloud demand. Cloud revenue rose 24% at constant currencies to €6.3 billion, while Cloud ERP Suite revenue climbed 27% to €5.5 billion.investing+1

Charles Brennan of Jefferies ↘ 0.87% said the results disproved recent investor caution and should be "enough for a rebound rally," describing the cloud contracts as an indication of strong order momentum. Oliver Frey of Metzler said the quarter "can somewhat ease the concerns recently felt at SAP and across the sector around the key theme of artificial intelligence".marketscreener

The rally lifted SAP from its lowest level since November 2023, which the stock had touched in the prior session. German software peers including Nemetschek, TeamViewer ↗ 0.42%, and Atoss also gained between 2.9% and 4.9%, buoying the DAX.marketscreener

Profit Miss and Cautious Outlook

Not all the numbers were positive. Non-IFRS operating profit grew 9% at constant currencies, lagging revenue expansion and missing analyst forecasts. Non-IFRS earnings per share of €1.59 fell short of consensus expectations. SAP updated its full-year profit outlook to reflect dilution from recent acquisitions of Dremio and Prior Labs.news.sap+1

CEO Christian Klein and CFO Dominik Asam framed the margin pressure as a deliberate investment in AI capabilities, with rising R&D spending and token costs weighing on profitability.investing

A Long Road Back

The rebound offered only partial relief after a punishing stretch. SAP shares have fallen roughly a third in 2026 and more than halved from their record high in February 2025, costing the company its long-held position as Germany's most valuable firm — a title now held by Siemens. SAP's market capitalization of approximately €167 billion now sits only marginally ahead of Allianz.marketscreener