Q4 2025 SAP SE Earnings Call Transcript
Key Points
- SAP SE (SAP) achieved a total cloud backlog of EUR77 billion, up 30%, indicating strong business momentum and future potential.
- The company exceeded its 2025 financial outlook for cloud revenue, as well as cloud and software revenue, despite macroeconomic challenges.
- SAP SE (SAP) reported that more than two-thirds of its Q4 cloud order entry included business AI, with a significant increase in AI adoption among customers.
- The company saw a ninefold increase in the number of customers using its AI co-pilot tool over the course of the year.
- SAP SE (SAP) announced a new two-year share repurchase program of up to EUR10 billion, reflecting confidence in the business's sustainable strength.
- The current cloud backlog growth slowed to 25%, which was below the anticipated 26%, due to a higher share of large deals with longer ramp periods.
- There was a notable deceleration in cloud revenue growth, with expectations of further slight deceleration in 2026.
- Geopolitical tensions and the emphasis on sovereign SaaS options have led to longer deal negotiation cycles, impacting the speed of deal closures.
- The company experienced a 27% decrease in software licenses revenue, highlighting a shift away from traditional software sales.
- SAP SE (SAP) faced challenges in accurately forecasting the cloud backlog due to changes in deal mix and larger deal sizes.
Ladies and gentlemen, thank you for standing by. Welcome and thank you for joining the SAP Q4 and full year 2025 earnings conference call. Throughout today's recorded presentation.
(Operator Instructions) I would now like to turn the conference over to Alexandra Steiger, Global Head of Investor Relations. Please go ahead.
Good morning, everyone, and welcome. Thank you for joining us. With me today are CEO, Christian Klein; and CFO, Dominik Asam. On this call, we will discuss SAP's fourth quarter and full year results for 2025. You can find the deck supplementing this call, as well as our quarterly statement on our Investor Relations website.
During this call, we will make forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations and assumptions that are subject to risk and uncertainties that could cause actual results and outcome to differ materially.
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