SAP Quarterly Statement Q1 2025

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SAP reported strong Q1 2025 financial results with significant growth across key metrics. Cloud revenue increased 27% to €4.99 billion, while total revenue grew 12% to €9.01 billion. The company's current cloud backlog reached €18.2 billion, up 28%.

Notable performance indicators include a 34% increase in Cloud ERP Suite revenue to €4.25 billion and an IFRS operating profit of €2.3 billion. The share of predictable revenue improved by 2 percentage points to 86%. Operating cash flow rose 31% to €3.78 billion, while free cash flow increased 36% to €3.58 billion.

Under its share repurchase program, SAP has repurchased 18,985,135 shares at an average price of €164.79, totaling approximately €3.1 billion. The company maintains its 2025 outlook, expecting cloud revenue of €21.6-21.9 billion and non-IFRS operating profit of €10.3-10.6 billion at constant currencies.

Positive

Cloud revenue increased 27% to €4.99 billion
Operating profit (non-IFRS) grew 60% to €2.46 billion
Free cash flow increased 36% to €3.58 billion
Cloud ERP Suite revenue up 34% to €4.25 billion
Share of predictable revenue improved to 86%

Negative

Software licenses revenue decreased 10% to €0.18 billion
Services revenue declined 1% to €1.07 billion
IaaS revenue decreased 37% to €104 million
Higher effective tax rate of 29.4% (non-IFRS) due to tax loss carryforward limitations

Insights

SAP delivers exceptional Q1 with 27% cloud revenue growth, 60% operating profit increase, and strong cash flow generation, validating its cloud transformation strategy.

SAP has delivered stellar financial results for Q1 2025, with €9.01 billion in total revenue, up 12%. The company's cloud momentum remains exceptional with cloud revenue surging 27% to €4.99 billion. The Cloud ERP Suite, SAP's strategic focus area, grew even faster at 34%.

The profit performance is particularly impressive, with non-IFRS operating profit jumping 60% to €2.46 billion and operating margin expanding 8.2 percentage points to 27.2%. This demonstrates that SAP's cloud transformation is now yielding significant economies of scale and operational efficiencies.

Looking at leading indicators, the current cloud backlog grew 28% to €18.20 billion, suggesting continued strong growth ahead. The share of predictable revenue increased to 86%, up 2 percentage points, highlighting the stability of SAP's business model.

Cash flow metrics show excellent financial health, with operating cash flow up 31% to €3.78 billion and free cash flow rising 36% to €3.58 billion. This has enabled SAP to return value to shareholders through a 6.8% dividend increase to €2.35 per share and their ongoing €5 billion share repurchase program.

While traditional software license revenue decreased by 10%, this is an expected consequence of the shift to subscription-based cloud models. The 2024 transformation program has concluded with total costs of approximately €3.2 billion, but is already delivering clear benefits through expanded margins and improved operational efficiency.

SAP's cloud-first strategy yields results with 34% Cloud ERP growth and major customer wins while launching Business Data Cloud platform for AI integration.

SAP's Q1 results validate its strategic pivot to cloud-first enterprise solutions. The 34% growth in Cloud ERP Suite revenue demonstrates strong market acceptance of SAP's core cloud offerings. Meanwhile, the strategic reduction in infrastructure services (IaaS down 37%) shows disciplined focus on higher-margin software capabilities rather than commodity infrastructure.

Customer adoption tells the compelling story behind the numbers. Global enterprises including Hyundai Motor Company, Tyson Foods, and HUGO BOSS selected "RISE with SAP" for their digital transformations. Smaller growing companies like Gymshark chose "GROW with SAP," demonstrating the platform's versatility across market segments.

The February launch of SAP Business Data Cloud represents a strategic move to unify data across SAP and third-party sources, creating an integrated foundation for AI applications. This positions SAP to capitalize on the enterprise AI trend while leveraging their core strength in business data.

Geographic performance shows strong global adoption, with SAP reporting outstanding cloud revenue in Brazil, Chile, Germany, India, Italy, South Korea and Spain. The balanced geographic growth indicates the universal appeal of SAP's cloud solutions across diverse markets and regulatory environments.

The cloud gross margin improvement of 2.5 percentage points to 75.0% demonstrates enhanced cloud operational efficiency, suggesting SAP has achieved significant economies of scale in its cloud infrastructure and delivery capabilities.

04/22/2025 - 04:05 PM

Current cloud backlog of €18.2 billion, up 28% and up 29% at constant currencies
Cloud revenue up 27% and up 26% at constant currencies
Cloud ERP Suite revenue up 34% and up 33% at constant currencies
Total revenue up 12% and up 11% at constant currencies
IFRS operating profit of €2.3 billion; non-IFRS operating profit of €2.5 billion, up 60% and up 58% at constant currencies

WALLDORF, Germany, April 22, 2025 /PRNewswire/ -- SAP SE (NYSE: SAP) announced today its financial results for the first quarter ended March 31, 2025.

Christian Klein, CEO:
Q1 once again underlines that our success formula is working. Current cloud backlog expanded 29% at constant currencies and total revenue saw a double-digit increase. With a share of more predictable revenue of 86%, SAP's business model remains resilient in uncertain times. Our AI-powered portfolio enables companies to navigate supply chain disruptions in over 130 countries and to unlock efficiencies with agility and speed.

Dominik Asam, CFO:
Q1 marks a solid start to the year in a highly volatile environment, with strong total revenue growth and outstanding operating profit expansion. These results are a testament to our cost discipline and focused execution. While we're encouraged by this momentum, we remain mindful of the broader environment and are approaching the rest of the year with vigilance, continuing to safeguard both profit and cash flow.

Financial Performance

Group results at a glance – First quarter 2025

	IFRS			Non-IFRS¹
€ million, unless otherwise stated	Q1 2025	Q1 2024	∆ in %	Q1 2025	Q1 2024	∆ in %	∆ in % const. curr.
SaaS/PaaS	4,890	3,764	30	4,890	3,764	30	28
Thereof Cloud ERP Suite²	4,251	3,167	34	4,251	3,167	34	33
Thereof Extension Suite³	639	598	7	639	598	7	6
IaaS⁴	104	164	–37	104	164	–37	–38
Cloud revenue	4,993	3,928	27	4,993	3,928	27	26
Cloud and software revenue	7,938	6,960	14	7,938	6,960	14	13
Total revenue	9,013	8,041	12	9,013	8,041	12	11
Share of more predictable revenue (in %)	86	84	2pp	86	84	2pp
Cloud gross profit	3,720	2,837	31	3,745	2,849	31	30
Gross profit	6,607	5,762	15	6,632	5,774	15	14
Operating profit (loss)	2,333	–787	NA	2,455	1,533	60	58
Profit (loss) after tax	1,796	–824	NA	1,681	944	78
Earnings per share - Basic (in €)	1.52	–0.71	NA	1.44	0.81	79
Net cash flows from operating activities	3,780	2,878	31
Free cash flow				3,583	2,642	36


¹	For a breakdown of the individual adjustments see table "Non-IFRS Operating Expense Adjustments by Functional Areas" in this Quarterly Statement.
²	Cloud ERP Suite references the portfolio of strategic Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS) solutions that are tightly integrated with our core ERP solutions and are included in key commercial packages, such as RISE with SAP. Further, Cloud ERP Suite also includes cloud-based maintenance components supporting our customers' ERP landscapes and their cloud transformation. The following offerings contribute to Cloud ERP Suite revenue: SAP Cloud ERP, SAP Business Technology Platform, financial- and spend management, supply chain management, core solutions for human capital management, commerce, business transformation management and AI.
³	Extension Suite references SAP's remaining SaaS and PaaS solutions that supplement and extend the functional coverage of the Cloud ERP Suite.
⁴	Infrastructure as a service (IaaS): The major portion of IaaS comes from SAP HANA Enterprise Cloud.

Financial Highlights¹

First Quarter 2025

In the first quarter, current cloud backlog grew by 28% to €18.20 billion and was up 29% at constant currencies. Cloud revenue was up 27% to €4.99 billion and up 26% at constant currencies. Cloud ERP Suite revenue was up 34% to €4.25 billion and up 33% at constant currencies.

Software licenses revenue decreased by 10% to €0.18 billion and was down 10% at constant currencies. Cloud and software revenue was up 14% to €7.94 billion and up 13% at constant currencies. Services revenue was down 1% to €1.07 billion and down 2% at constant currencies. Total revenue was up 12% to €9.01 billion and up 11% at constant currencies.

The share of more predictable revenue increased by 2 percentage points to 86%.

IFRS cloud gross profit was up 31% to €3.72 billion. Non-IFRS cloud gross profit was up 31% to €3.74 billion and was up 30% at constant currencies. IFRS Cloud gross margin was up 2.3 percentage points to 74.5%, non-IFRS cloud gross margin up 2.5 percentage points to 75.0% and up 2.6 percentage points at constant currencies.

IFRS operating profit increased to €2.33 billion and IFRS operating margin was up 35.7 percentage points to 25.9%. IFRS operating profit growth was positively impacted by a restructuring expense decline of €2.2 billion as compared to Q1 2024 in connection with the 2024 transformation program. Non-IFRS operating profit was up 60% to €2.46 billion and was up 58% at constant currencies, non-IFRS operating margin increased by 8.2 percentage points to 27.2% and was up 8.1 percentage points to 27.1% at constant currencies. Both, IFRS and non-IFRS operating profit growth benefitted from the operational efficiencies realized through successful execution of the 2024 transformation program.

IFRS earnings per share (basic) increased to €1.52. Non-IFRS earnings per share (basic) increased 79% to €1.44. IFRS effective tax rate was 27.2% and non-IFRS effective tax rate was 29.4%. Both were mainly driven by a temporary inability to offset withholding taxes in Germany due to carryforward of tax losses from prior year. The IFRS effective tax rate is lower than the non-IFRS effective tax rate due to tax benefits from tax-exempt income.

Operating cash flow in the first quarter was up 31% to €3.78 billion and free cash flow increased by 36% to €3.58 billion. The increase was mainly attributable to the higher profitability and the positive development of working capital (outside of restructuring related impacts), which was partially offset by higher payouts for share-based compensation and restructuring.

Share Repurchase Program

In May 2023, SAP announced a share repurchase program with an aggregate volume of up to €5 billion and a term until December 31, 2025. As of March 31, 2025, SAP had repurchased 18,985,135 shares at an average price of €164.79 resulting in a purchased volume of approximately €3.1 billion under the program. Additionally, the third tranche of the program was completed on April 08, 2025, with a purchased volume of approximately €1.5 billion.

2024 Transformation Program: Focus on scalability of operations and key strategic growth areas

In January 2024, SAP announced a company-wide restructuring program which concluded as planned in the first quarter 2025. Overall expenses associated with the program are approximately €3.2 billion. Restructuring payouts amounted to €2.5 billion for the full-year 2024 and €0.3 billion for the first quarter 2025. Approximately €0.4 billion is expected to be paid out in the remainder of 2025.

Business Highlights

In the first quarter, customers around the globe continued to choose "RISE with SAP" to drive their end-to-end business transformations. These customers included: Alte Leipziger-Hallesche, East Japan Railway, Federal Employment Agency (Bundesagentur für Arbeit), Heijmans, HUGO BOSS, Hyundai Motor Company, Kia Corporation, Mazda Motor, Molson Coors Beverage Company, Piramal Pharma, SYENSQO, TOPPAN, Tyson Foods, Villeroy & Boch Group, Webasto Group, and WWZ Energie.

Climeworks, HMM, LG Energy Solution, Lion, Nanometrics, and Samyang Foods went live on SAP S/4HANA Cloud in the first quarter.

Gymshark, HARGASSNER, Oki Electric Industry, Sciens Building Solutions, Stegra, and VFS Global chose "GROW with SAP", an offering helping customers adopt cloud ERP with speed, predictability, and continuous innovation.

Key customer wins across SAP's solution portfolio included: ACTION, Booking, DKSH, Energy Queensland, Ferring Pharmaceuticals, KION GROUP, Klüber Lubrication München, The Kraft Heinz, Maastricht University, MARELLI Europe, NEC Corporation, Tibnor, and WEG.

Alfred Ritter, Axpo Services, BASF Coatings, Deutsche Bahn, Parle Biscuits, Ravensburger, and Wipro went live on SAP solutions.

In the first quarter, SAP's cloud revenue performance was particularly strong in APJ and EMEA and robust in the Americas region. Brazil, Chile, Germany, India, Italy, South Korea and Spain had outstanding performances, while Canada, China, France, Japan, Singapore and the U.S. were particularly strong.

On February 13, SAP announced SAP Business Data Cloud, a groundbreaking solution that unifies SAP and third-party data throughout an organization, providing the trusted data foundation organizations need to make more impactful decisions and foster reliable AI.

On February 20, SAP proposed a dividend of €2.35 per share for fiscal year 2024 representing a year-over-year increase of 6.8% compared to the regular dividend paid for fiscal year 2023. The dividend is subject to shareholder approval at the upcoming AGM scheduled for May 13, 2025.

Outlook 2025

Financial Outlook 2025

While the prevailing dynamic environment implies elevated levels of uncertainty and reduced visibility, SAP currently continues to expect:

€21.6 – 21.9 billion cloud revenue at constant currencies (2024: €17.14 billion), up 26% to 28% at constant currencies.
€33.1 – 33.6 billion cloud and software revenue at constant currencies (2024: €29.83 billion), up 11% to 13% at constant currencies.
€10.3 – 10.6 billion non-IFRS operating profit at constant currencies (2024: €8.15 billion), up 26% to 30% at constant currencies.
Approximately €8.0 billion free cash flow at actual currencies (2024: €4.22 billion)
An effective tax rate (non-IFRS) of approximately 32% (2024: 32.3%)².

The company also continues to expect current cloud backlog growth at constant currencies to slightly decelerate in 2025.

While SAP's 2025 financial outlook for the income statement parameters is at constant currencies (including an average exchange rate of 1.08 USD per EUR), actual currency reported figures are expected to be impacted by currency exchange rate fluctuations as the company progresses through the year, as reflected in the table below.

Currency Impact Assuming March 31, 2025. Rates Apply for 2025

In percentage points	Q2 2025	FY 2025
Cloud revenue growth	-1.0pp	-2.0pp
Cloud and software revenue growth	-1.0pp	-0.5pp
Operating profit growth (non-IFRS)	0.0pp	-1.0pp

This includes an exchange rate of 1.08 USD per EUR.

Additional Information

This press release and all information therein is preliminary and unaudited. Due to rounding, numbers may not add up precisely. The Q1 2025 Quarterly Statement can be downloaded from: https://www.sap.com/investors/sap-2025-q1-statement

SAP Annual General Meeting of Shareholders

The Annual General Meeting of Shareholders will take place on May 13, 2025, as a virtual event. The whole event will be webcast on the Company's website and online voting options will be available for shareholders. Further details can be found at https://www.sap.com/agm.

Financial Analyst and Investor Conference

SAP will hold a financial analyst event on Wednesday, May 21^st, in conjunction with SAP Sapphire & ASUG Annual Conference Orlando.

SAP Performance Measures

For more information about our key growth metrics and performance measures, their calculation, their usefulness, and their limitations, please refer to the following document on our Investor Relations website: https://www.sap.com/investors/performance-measures

Webcast

SAP senior management will host a financial analyst conference call on Tuesday, April 22nd at 11:00 PM (CEST) / 10:00 PM (BST) / 5:00 PM (EDT) / 2:00 PM (PDT). The conference will be webcast on the Company's website at https://www.sap.com/investor and will be available for replay. Supplementary financial information pertaining to the first quarter results can be found at https://www.sap.com/investor

About SAP

As a global leader in enterprise applications and business AI, SAP (NYSE: SAP) stands at the nexus of business and technology. For over 50 years, organizations have trusted SAP to bring out their best by uniting business-critical operations spanning finance, procurement, HR, supply chain, and customer experience. For more information, visit www.sap.com.

For customers interested in learning more about SAP products:
Global Customer Center:	+49 180 534-34-24
United States Only:	+1 (800) 872-1SAP (+1-800-872-1727)

This document contains forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations, forecasts, and assumptions that are subject to risks and uncertainties that could cause actual results and outcomes to materially differ. Additional information regarding these risks and uncertainties may be found in our filings with the Securities and Exchange Commission, including but not limited to the risk factors section of SAP's 2024 Annual Report on Form 20-F.

© 2025 SAP SE. All rights reserved.
SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE in Germany and other countries. Please see https://www.sap.com/copyright for additional trademark information and notices.

¹ The Q1 2025 results were also impacted by other effects. For details, please refer to the disclosures on page 19 of this document.

² The effective tax rate (non-IFRS) is a non-IFRS financial measure and is presented for supplemental informational purposes only. We do not provide an outlook for the effective tax rate (IFRS) due to the uncertainty and potential variability of gains and losses associated with equity securities, which are reconciling items between the two effective tax rates (non-IFRS and IFRS). These items cannot be provided without unreasonable efforts but could have a significant impact on our future effective tax rate (IFRS).

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SOURCE SAP SE

FAQ

What is SAP's cloud revenue growth in Q1 2025?

SAP's cloud revenue grew 27% to €4.99 billion in Q1 2025, with a 26% increase at constant currencies.

How much has SAP spent on share buybacks as of March 2025?

SAP has repurchased shares worth approximately €3.1 billion at an average price of €164.79 per share under its €5 billion buyback program.

What is SAP's cloud backlog growth in Q1 2025?

SAP's current cloud backlog grew by 28% to €18.20 billion and was up 29% at constant currencies.

What is SAP's operating profit for Q1 2025?

SAP reported an IFRS operating profit of €2.33 billion and non-IFRS operating profit of €2.46 billion, up 60% year-over-year.

What is SAP's revenue outlook for 2025?

SAP expects cloud revenue of €21.6-21.9 billion and cloud and software revenue of €33.1-33.6 billion at constant currencies for 2025.

SAP Quarterly Statement Q1 2025