SAP (SAP) Q4 2025 (Media) earnings summary

Executive summary

• Achieved and exceeded outlook for operating profit and free cash flow in 2025, with robust cloud growth and a record cloud backlog of up to EUR 77.3 billion, up 30% year-over-year at constant currencies.

• Cloud ERP Suite and AI adoption were key growth drivers, with AI included in two-thirds of Q4 cloud order entry.

• Transformation strategies (RISE and GROW) and Business Data Cloud drove significant cloud adoption, especially in the mid-market.

• Announced a new EUR 10 billion share repurchase program to be executed from February 2026 through 2027.

Financial highlights

• Cloud revenue increased 26% year-over-year in 2025 to EUR 21 billion, with Cloud ERP Suite up 32% at constant currencies.

• Total revenue for the year approached EUR 37 billion, up 11% at constant currencies.

• IFRS operating profit for the year was EUR 9.8 billion; non-IFRS operating profit EUR 10.4 billion, up 28%.

• Free cash flow reached EUR 8.24 billion, at the high end of guidance, up 95% year-over-year.

• Non-IFRS basic EPS increased 36% to EUR 6.15.

Outlook and guidance

• FY2026 guidance: cloud revenue EUR 25.8–26.2 billion (+23–25% at constant currencies), non-IFRS operating profit EUR 11.9–12.3 billion (+14–18%), free cash flow ~EUR 10 billion.

• Current cloud backlog growth expected to decelerate moderately in 2026, but less than in 2025.

• Total revenue growth anticipated to accelerate through 2027.

• Midterm non-IFRS effective tax rate guided to 28%-30%.