SAP (NYSE: SAP) 2025 profit and free cash flow surge on cloud
Rhea-AI Filing Summary
SAP SE filed its 2025 annual report, showing higher scale and profitability driven by cloud growth and disciplined cost management. IFRS total revenue rose to €36.8 billion, with cloud revenue increasing to €21.0 billion, now the largest revenue stream.
IFRS operating profit grew to €9.6 billion and profit after tax from continuing operations reached €7.3 billion, both up strongly from 2024. Free cash flow increased to €8.2 billion, reflecting robust cash generation after investments and lease payments.
SAP continues to manage the business primarily on non-IFRS metrics, adjusting for acquisition-related, restructuring, and certain legal and compliance items, and emphasizes cloud-centric measures like current and total cloud backlog. The Executive and Supervisory Boards plan to propose a €2.50 per-share dividend for 2025, up from €2.35.
Positive
- Strong top-line and cloud growth: 2025 IFRS revenue increased to €36.8 billion from €34.2 billion, with cloud revenue rising to €21.0 billion, now SAP’s largest revenue stream.
- Profit and free cash flow inflection: IFRS operating profit advanced to €9.6 billion (from €4.7 billion) and free cash flow nearly doubled to €8.2 billion from €4.2 billion, supporting higher shareholder returns.
- Dividend increase: The Executive and Supervisory Boards plan to propose a 2025 dividend of €2.50 per share, up from €2.35, signaling confidence in earnings quality and cash generation.
Negative
- None.
Insights
SAP delivers strong 2025 cloud-led growth, margin expansion and doubled free cash flow.
SAP reports 2025 IFRS revenue of
Management continues to steer by non-IFRS measures, excluding acquisition-related, restructuring and specified legal/compliance items, and focuses on cloud metrics such as current cloud backlog and subscription revenue. This framework underpins guidance, budgeting and internal incentives, so these adjusted figures largely shape how performance is evaluated.
Cash generation is a notable highlight: free cash flow rose to
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) | |
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) | |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) | |
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) | |
Date of event requiring this shell company report…………… | |
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SAP EUROPEAN COMPANY
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Introduction | | 6 |
Forward-Looking Statements |
| 6 |
Performance Management System |
| 7 |
Measures to Manage Our Financial Performance | 7 | |
Measures to Manage Our Non - Financial Performance | 8 | |
Value - Based Management | 9 | |
Non - IFRS Financial Measures Cited in This Report | 9 | |
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PART I |
| 15 |
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
| 15 |
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE |
| 15 |
ITEM 3. KEY INFORMATION |
| 15 |
Exchange Rates |
| 15 |
Dividends |
| 15 |
Dividend Distribution Policy | 15 | |
Annual Dividends Paid and Proposed | 16 | |
Risk Factors |
| 17 |
ITEM 4. INFORMATION ABOUT SAP |
| 22 |
Strategy and Business Model |
| 24 |
Overview of SAP | 24 | |
Our Purpose | 24 | |
Our Vision | 24 | |
Our Business Model | 25 | |
Subsidiaries, Acquisitions, and Joint Ventures | 25 | |
Our Product Strategy | 25 | |
Our Customers | 30 | |
Our Investments in Innovation | 31 | |
Seasonality |
| 31 |
Security, Cloud Compliance, and Data Protection and Privacy |
| 32 |
Our Approach and Policies | 32 | |
Our Actions and Targets | 32 | |
Metrics on Material Topics | 36 | |
Human Capital Resources | 36 | |
People Agenda | 36 | |
#Unfiltered | 37 | |
Energy and Emissions |
| 38 |
Our Approach and Policies | 38 | |
Our Actions and Targets | 38 | |
Net - Zero Target: Expected Impact of GHG Reduction Levers1 | 39 | |
Intellectual Property, Proprietary Rights and Licenses |
| 41 |
Description of Property |
| 41 |
Investments | 42 | |
ITEM 4A. UNRESOLVED STAFF COMMENTS |
| 42 |
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS |
| 43 |
Overview | 43 | |
Economy and the Market | 43 | |
Performance Against Our Outlook for 2025 | 45 | |
Operating Results (IFRS) |
| 46 |
Our 2025 Results Compared to Our 2024 Results (IFRS) | 46 | |
Our 2024 Results Compared to Our 2023 Results (IFRS) | 52 | |
Financial Income, Net | 55 | |
Foreign Currency Exchange Rate Exposure |
| 56 |
Liquidity and Capital Resources |
| 57 |
Finances (IFRS) | 57 | |
Research and Development |
| 61 |
New Accounting Standards Not Yet Adopted |
| 61 |
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Expected Developments |
| 62 |
Economic Outlook for 2026 and Beyond | 62 | |
Financial Targets and Prospects | 64 | |
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
| 66 |
Supervisory Board | 66 | |
Executive Board | 67 | |
Compensation Report |
| 68 |
Compensation for Executive and Supervisory Board Members | 68 | |
Compensation for Executive Board Members | 68 | |
Share - Based Payment Information Relating to Long - Term Incentives | 90 | |
End - of - Service Benefits | 92 | |
Compensation for Supervisory Board Members | 97 | |
Comparative Information on the Change of Compensation and Company Performance | 99 | |
Employees |
| 100 |
Headcount and Personnel Expense | 100 | |
Employee and Labor Relations | 100 | |
Share Ownership |
| 101 |
Beneficial Ownership of Shares | 101 | |
Share-Based Compensation Plans |
| 101 |
Share - Based Compensation | 101 | |
ITEM 7. MAJOR SHAREHOLDERS AND RELATED-PARTY TRANSACTIONS |
| 101 |
Major Shareholders | 101 | |
Related - Party Transactions | 101 | |
ITEM 8. FINANCIAL INFORMATION |
| 102 |
Consolidated Financial Statements and Financial Statement Schedule | 102 | |
Other Financial Information | 102 | |
Significant Changes | 102 | |
ITEM 9. THE OFFER AND LISTING |
| 103 |
ITEM 10. ADDITIONAL INFORMATION | | 103 |
Articles of Incorporation | 103 | |
Corporate Governance | 103 | |
Change in Control | 107 | |
Change in Share Capital | 108 | |
Rights Accompanying our Shares | 108 | |
Taxation | 109 | |
Material Contracts | 113 | |
Documents on Display | 113 | |
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
| 113 |
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
| 113 |
American Depositary Shares | 113 | |
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
| 115 |
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
| 115 |
ITEM 15. CONTROLS AND PROCEDURES |
| 115 |
Evaluation of Disclosure Controls and Procedures | 115 | |
Management’s Annual Report on Internal Control Over Financial Reporting | 115 | |
Changes in Internal Control Over Financial Reporting | 115 | |
ITEM 16. [RESERVED] |
| 116 |
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT |
| 116 |
ITEM 16B. CODE OF ETHICS |
| 116 |
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES |
| 116 |
Audit Fees, Audit Related Fees, Tax Fees and All Other Fees | 116 | |
Audit Committee’s Pre - Approval Policies and Procedures | 116 | |
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
| 117 |
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS |
| 117 |
ITEM 16F. CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT |
| 118 |
ITEM 16G. DIFFERENCES IN CORPORATE GOVERNANCE PRACTICES |
| 118 |
Introduction | 118 | |
Legal Framework | 118 | |
Significant Differences | 119 |
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SAP SE is a European Company With a Two - Tier Board System | 119 | |
Director Independence Rules | 119 | |
Audit Committee Independence | 121 | |
Rules on Non - Management Board Meetings are Different | 121 | |
Rules on Establishing Committees Differ | 121 | |
Rules on Shareholders’ Compulsory Approval are Different | 121 | |
Specific Principles of Corporate Governance | 121 | |
Specific Code of Business Conduct | 121 | |
ITEM 16H. MINE SAFETY DISCLOSURE | 122 | |
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS | 122 | |
ITEM 16J. INSIDER TRADING POLICIES | 122 | |
ITEM 16K. CYBERSECURITY | 122 | |
Risk Management and Strategy | 122 | |
Cybersecurity Governance | 123 | |
ITEM 17. FINANCIAL STATEMENTS | 125 | |
ITEM 18. FINANCIAL STATEMENTS |
| 125 |
ITEM 19. EXHIBITS |
| 126 |
Signatures |
| 127 |
Index to the Consolidated Financial Statements |
| F-1 |
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Introduction
SAP SE is a European Company (Societas Europaea, or “SE”) and is referred to in this report, together with its subsidiaries, as SAP, or as “Company,” “Group,” “we,” “our,” or “us.”
In this report: (i) references to “US$,” “$,” or “dollars” are to U.S. dollars; (ii) references to ‘‘€” or “euro” are to the euro. Our financial statements are denominated in euros, which is the currency of our home country, Germany. Certain amounts that appear in this report may not add up because of differences due to rounding. All numbers in SAP’s Consolidated Financial Statements IFRS are presented according to IFRS 5 (unless otherwise noted, figures are based on continuing operations). For more information, see Note D.1.
Unless otherwise specified herein, euro financial data have been converted into dollars at the noon buying rate in New York City for cable transfers in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York (the “Noon Buying Rate”) on December 31, 2025, which was 1.1736 EUR/USD. No representation is made that such euro amounts actually represent such dollar amounts or that such euro amounts could have been or can be converted into dollars at that or any other exchange rate on such date or on any other date. On February 5, 2026, the Noon Buying Rate for converting euro to dollars was US$1.18 per €1.00.
Unless the context otherwise requires, references in this report to ordinary shares are to SAP SE’s ordinary shares, without nominal value. References in this report to “ADRs” are to SAP SE’s American Depositary Receipts, each representing one SAP ordinary share. References in this report to “ADSs” are to SAP SE’s American Depositary Shares, which are the deposited securities evidenced by the ADRs.
SAP, Adaptive Server, Advantage Database Server, BusinessObjects, ExpenseIt, PartnerEdge, PowerBuilder, PowerDesigner, Replication Server, SAP Ariba, SAP Concur, SAP EarlyWatch, SAP Emarsys, SAP Fieldglass, SAP Fiori, SAP HANA, SAP Jam, SAP LeanIX, SAP Lumira, SAP S/4HANA, SAP SuccessFactors, SAP Taulia, SAP Vora, Sapphire, SAP Signavio, SQL Anywhere, TripIt, TripLink, WalkMe, Web Intelligence and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE (or an SAP affiliate company) in Germany and other countries.
Throughout this report, whenever a reference is made to our website, such reference does not incorporate by reference into this report the information contained on our website.
We intend to make this report and other periodic reports publicly available on our website (www.sap.com) without charge immediately following our filing with the U.S. Securities and Exchange Commission (SEC). Such reports are also available on the website maintained by the SEC (www.sec.gov). We assume no obligation to update or revise any part of this report, whether as a result of new information, future events or otherwise, unless we are required to do so by law.
Forward-Looking Statements
This report contains forward-looking statements and information based on the beliefs of, and assumptions made by, our management using information currently available to them. Any statements contained in this report that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations, assumptions, and projections about future conditions and events. As a result, our forward-looking statements and information are subject to uncertainties and risks. A broad range of uncertainties and risks, many of which are beyond our control, could cause our actual results and performance to differ materially from any projections expressed in or implied by our forward-looking statements. The uncertainties and risks include, but are not limited to:
- Global Economic and Political Environment: Uncertainty in the global economy and/or, financial markets, and social and political instability caused by state-based conflicts, terrorist attacks, civil unrest, war, or international hostilities could lead to disruptions in our business.
– International Laws and Regulations: Laws, regulatory requirements and standards in the EU, Germany, the United States, and elsewhere continue to be very stringent. Our international business activities and processes expose us to numerous and often conflicting laws and regulations, policies, standards, or other requirements and sometimes even conflicting regulatory requirements.
– Legal and IP: Claims and lawsuits against us, such as for IP infringements, or our inability to obtain or maintain adequate licenses for third-party technology, or if we are unable to adequately protect or enforce our own intellectual property, may result in adverse outcomes.
- Data Protection and Privacy: Non-compliance with increasingly complex and stringent, sometimes even conflicting, applicable data protection and privacy laws or failure to meet the contractual requirements of SAP’s customers with respect to our products and services could lead to civil liabilities and fines, as well as loss of customers.
– Ethical Behavior: Our global business exposes us to risks related to unethical behavior and non-compliance with policies by employees, other individuals, partners, third parties or entities associated with SAP.
- Sales and Services: Sales and implementation of SAP software and services, including cloud, are subject to several significant risks sometimes beyond our direct control.
- Partner Ecosystem: If we are unable to scale, maintain, and enhance an effective partner ecosystem, revenue might not increase as expected.
– Cloud Operations: We may not be able to properly protect and safeguard our critical information and assets, business operations, cloud offerings and portfolio presentation, and related infrastructure against cyberattacks, insufficient infrastructure, disruption or deficient performance.
– Cybersecurity and Security: Cybersecurity attacks or breaches, and security vulnerabilities in our infrastructure or services or those of our third-party partners could materially impact our business operations, products and service delivery.
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– Technology and Products: Our technology and products may experience undetected defects, coding, or configuration errors, may not integrate as expected, or may not meet customer expectations.
– Market Share and Profit: Our market share and profit could decline due to increased competition, market consolidation, technological innovation, and new business models in the software industry.
– Mergers and Acquisitions: We might not acquire, integrate or divest companies effectively or successfully.
– Innovation: We might not be able to compete effectively if we strategize our solution portfolio ineffectively or if we are unable to keep up with rapid technological and product innovations, enhancements, new business models, and changing market expectations.
We describe these and other risks and uncertainties in the Risk Factors section.
If one or more of these uncertainties or risks materializes, or if management’s underlying assumptions prove incorrect, our actual results could differ materially from those described in or inferred from our forward-looking statements and information.
The words “aim,” “anticipate,” “assume,” “believe,” “continue,” “could,” “counting on,” “is confident,” “development,” “estimate,” “expect,” “forecast,” “future trends,” “guidance,” “intend,” “may,” “might,” “outlook,” “plan,” “predict,” “project,” “seek,” “should,” “strategy,” “want,” “will,” “would,” and similar expressions as they relate to us are intended to identify such forward-looking statements. Such statements include, for example, those made in the Operating Results (IFRS) subsection; our quantitative and qualitative disclosures about market risk pursuant to the International Financial Reporting Standards (IFRS) accounting standards, namely IFRS 7 and related statements in our Notes to the Consolidated Financial Statements; Expected Developments and Risk Factors sections; and other forward-looking information appearing in other parts of this report.
To fully consider the factors that could affect our future financial results, both this report and our Integrated Report should be considered, as well as all our other filings and furnishings with the U.S. Securities and Exchange Commission (SEC). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date specified or the date of this report. We undertake no obligation to publicly update or revise any forward-looking statements as a result of new information that we receive about conditions that existed upon issuance of this report, future events, or otherwise, unless we are required to do so by law.
This report includes statistical data about the IT industry and global economic trends that comes from information published by sources including International Data Corporation (IDC), the European Central Bank (ECB), and the International Monetary Fund (IMF). This type of data represents only the estimates of IDC, the ECB, the IMF, and other sources of industry data. SAP does not adopt or endorse any of the statistical information provided by sources such as IDC, the ECB, the IMF, or other similar sources that is contained in this report. The data from these sources is subject to risks and uncertainties, and subject to change based on various factors, including those described above, in the Risk Factors section, and elsewhere in this report. These and other factors could cause our results to differ materially from those expressed in the estimates made by third parties and SAP. We caution readers not to place undue reliance on this data.
Performance Management System
In the reporting year, we used various measures to manage our performance on our primary financial objectives, which are growth and profitability, and on our primary non-financial objectives, which are customer loyalty, employee engagement, climate performance, and business health culture.
Measures to Manage Our Financial Performance
The following are the key measures we use to manage our operating and overall financial performance. Except for free cash flow, we report our key measures at both actual and constant currencies.
We use cloud revenue, cloud and software revenue, current cloud backlog (CCB), and total revenue to measure our progress toward our growth targets. Cloud revenue comprises the main revenues of our cloud business and is derived from fees earned from providing customers with software as a service (SaaS), platform as a service (PaaS), and infrastructure as a service (IaaS). Cloud and software revenue includes cloud revenue, software license revenue, and software support revenue. The vast majority of customers who purchase software licenses also enter into related support contracts with us that generate recurring support revenue after the software sale. Cloud revenue is our largest revenue stream, followed by software support revenue. For more information about our revenue measures, see the Notes to the Consolidated Financial Statements 2025, Note (A.1).
As of a specific key date, the CCB is the contractually committed cloud revenue we expect to recognize over the upcoming 12 months. It is therefore a subcomponent of our overall remaining performance obligations, as per IFRS 15.120. Contractual periods that are subject to a customer termination for convenience right without a significant early-termination fee, or that are subject to a termination right under applicable law, are excluded from our CCB. For our committed cloud business, we believe the CCB is a valuable indicator of our go-to-market success, as it reflects both new contracts and contract renewals.
To measure our profitability, we primarily use operating profit (non-IFRS) and free cash flow. Operating profit (non-IFRS) offers insight into our overall operational process efficiency and business performance, while free cash flow provides management with supplemental information for assessing our liquidity needs and position. Free cash flow is used to determine the cash flow remaining after all net expenditures required to maintain or expand our organic business have been paid off.
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Besides the key measures mentioned above, SAP also uses various supporting measures to offer further insight into our financial performance. These include Cloud ERP Suite revenue,1 total cloud backlog (TCB),2 share of more predictable revenue,3 subscription revenue, cloud gross profit, and effective tax rate (non-IFRS).4 The subscription revenue measure, introduced in 2025, is the sum of cloud revenue and revenue from time-based on-premise software licenses, which allow our customers to use our software for a specific, predefined period, and the associated software support. Revenue from time-based on-premise licenses is recognized at a point in time, whereas revenue from the associated software support is recognized over time. We use the subscription revenue measure as an indicator of SAP’s revenues, most of which are recurring, across deployment models and offerings that for strategic reasons are sustained over time. It does not include software licenses and support revenue from our perpetual licenses. From 2026 onward, subscription revenue will replace the share of more predictable revenue. We report most of our supporting measures both at actual and constant currencies.
Measures to Manage Our Non-Financial Performance
The following are the key measures we used to manage our non-financial performance in the reporting year.
We measure customer experience because we believe that we can only achieve our financial goals if our customers are satisfied with and loyal to SAP and our solutions. We assess customer experience annually by means of a survey that tracks our customer experience KPI based on a dedicated question on the survey. Historically our KPI metric has been the customer net promoter score (NPS), which is measured with the standard, proprietary “likelihood to recommend” question. Its proprietary scoring methodology arrives at the final NPS by taking the difference between the percentage of “Promoters” and “Detractors”, which are categorized based on customers’ numerical rating from 0-10. “Promoters” are customers who rate their likelihood to recommend SAP with a 9 or 10 on the 11-point scale; “Detractors” are customers rating us as a 0-6. The NPS calculation method ignores “Passives” giving a score of 7 or 8, which is a significant limitation of the metric. Based on the NPS methodology’s subtractive calculation based on percentages of two groups, the range of achievable scores is–100 to +100, with the latter being the best achievable score for customer loyalty.
Starting in 2026, we will revise our customer experience KPI framework by switching from Customer NPS (Net Promoter Score) to Cloud Customer Satisfaction (Cloud CSAT). The Cloud CSAT metric is calculated as a “top 2-box” score, taking the percentage of customers who are “very satisfied” or “satisfied” with SAP, as indicated on a 5-point scale that provides response options from “very satisfied” to “very dissatisfied”. Consequently, the range of achievable scores is between 0 and 100, with the latter being the best achievable score for customer satisfaction as measured by the Cloud CSAT methodology.
The Cloud CSAT KPI is calculated based on feedback from our cloud customers. A cloud customer is a customer providing feedback either (1) explicitly about one of the cloud solutions that they have implemented and are operationally running, or (2) giving feedback about “SAP in general” while having implemented and operationally running either exclusively one or more cloud solution(s) or has a mixed portfolio that does not include certain pre-defined solutions, confirmed to be running as on-premise. If a customer runs any of the pre-defined on-premise solutions (ERP On-Prem, HANA On-Prem, S/4HANA On-Prem, HCM On-Prem, SAP Business Objects, SAP Business Warehouse), with none running on private cloud, they are treated as an on-premise customer and their rating score is not considered in the Cloud CSAT calculation. The revenue generated with cloud solutions in any mixed portfolio counts towards cloud revenue reported in our financial information. With this change, SAP aligns the KPI to our cloud-first strategy. In 2025, the Cloud CSAT score was 75%.
The Employee Engagement Index5 measures the satisfaction and commitment of our employees, how proud they are of our company, and how strongly they identify with SAP. Applying this measure is recognition that our growth strategy depends on having engaged employees. The index is expressed as a percentage of favorable responses to five questions in our #Unfiltered engagement survey and we report it as the average of the scores retrieved in each of the surveys we run in a fiscal year. The #Unfiltered program is based on a “continuous listening” approach that includes two data collections throughout the year. The average scores provide an assessment, for the full year, of our employees’ engagement level.
The Business Health Culture Index (BHCI)6 reflects the extent to which SAP provides a working environment that promotes health, supports long-term employability, and fosters active engagement in achieving corporate goals. The index score is the percentage of favorable responses to 10 questions in our #Unfiltered engagement survey and we report it as the average of the scores retrieved in each of the surveys we run in a fiscal year. In the reporting year, the BHCI replaced the Women in Executive Roles measure as one of our key non-financial performance indicators. In 2025, we added equal opportunities as a new component of the index and replaced one of the health and well-being questions so that the revised index gives a holistic view of the employee experience at SAP across key themes, making it a strong indicator of a healthy work environment.
1 We use Cloud ERP Suite revenue as a metric to measure the growth of our portfolio of strategic cloud solutions. Cloud ERP Suite references those offerings that are tightly integrated with our core ERP solutions and are included in key commercial packages, such as RISE with SAP. The following offerings contribute to Cloud ERP Suite revenue: SAP S/4HANA Cloud, SAP Business Technology Platform, and core solutions for People & Culture and payroll, spend management, commerce, customer data solutions, business process transformation, and working capital management.
2 As of a specific key date, the TCB is the total contractually committed cloud revenue we expect to recognize. Thus, TCB and CCB are both subcomponents of our overall remaining performance obligations following IFRS 15.120. For our committed cloud business, we believe that the TCB and the CCB are valuable indicators of our go-to-market success, as they reflect both new contracts and contract renewals. Contractual periods that are subject to a customer termination for convenience right without a significant early-termination fee, or that are subject to a termination right under applicable law, are excluded from our CCB and TCB. For more information about how we calculate these numbers, see the Notes to the Consolidated Financial Statements, Note (A.1).
3 The share of more predictable revenue is the total of cloud revenue and software support revenue divided by total revenue.
4 We define our effective tax rate as the ratio of income tax expense (non-IFRS) to profit before tax (non-IFRS), expressed as a percentage.
5 Methodologies and significant assumptions behind the metric - Employee Engagement Index: ESRS 2 MDR-M 77 (a).
6 Methodologies and significant assumptions behind the metric - Business Health Culture Index: ESRS 2 MDR-M 77 (a).
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The gross greenhouse gas emissions metric is used to measure greenhouse gas emissions along the value chain (Scope 1, Scope 2, and Scope 3 emissions relevant to SAP’s business model) as part of our net-zero commitment. We apply a market-based approach. Renewable energies, for example in the form of self-generated renewable electricity, investments in certified renewable energy certificates, long-term green electricity contracts (power purchase agreements), and renewable electricity purchased by our suppliers and customers, can count toward the reduction of greenhouse gas emissions. We define, measure, and report our greenhouse gas emissions according to the Greenhouse Gas (GHG) Protocol (in millions of tons of CO2 equivalents). The reporting also complies with ESRS.
In 2026, we intend to revise the methodology we use to calculate Scope 3 GHG emissions. We will replace our current methodology for calculating category 11 emissions from the use of sold products, which is based on the total amount of active maintenance contracts, with a forward-looking approach that considers the estimated emissions during the lifetime of all new systems sold within a specific period. This change aligns our approach more closely with the GHG Protocol. The revised calculation methodology will result in a significant decrease in reported emissions and therefore lead to a re-baselining in accordance with the GHG Protocol. Had this methodology been applied in the reporting year, our 2025 GHG emissions would have been 3,590 kilotons.
Value-Based Management
Our holistic view of the performance measures described above, and the associated analyses, together form the foundation of our value-based management. We use planning and control processes to manage the compilation of these key measures and their availability to our decision-makers across various management levels. SAP’s long-term strategic plans are the point of reference for our short- and medium-term planning and controlling processes. We initially identify future growth and profitability drivers at a highly aggregated level for the entire SAP Group.
In a first step, the financial plan’s growth ambition is determined by the Group’s comprehensive product portfolio, which is grouped into solution areas, and profitability drivers are allocated to functions such as development, marketing, sales, delivery, and administration.
In a second step, the planned total revenues and total expenses are allocated to the operating segments and the areas of functional responsibility of the individual members of the Executive Board (“Board area”). If one of these Board areas represents both a functional department and operating segments, planned revenues and expenses are allocated at segment level. Budget adjustments may be applied during the year to reflect changes in priorities, to achieve efficiency targets, and to reflect internal and external factors. Budget adjustments and the assessment of the performance are managed either at the Board area level if the Board area constitutes a single segment, or at the segment level if the Board area comprises several segments. The Executive Board member is responsible for distributing the budget within the Board area or at segment level as applicable. Based on an integrated portfolio process running in parallel to the budgeting process, we ensure aligned investment behavior across Board areas with regard to specific solution or sub-solution areas.
In a final step, customer-facing revenue targets and cost-of-sales and marketing targets are broken down into sales regions and market units.
Based on our detailed annual plans, we determine the budget for the respective fiscal year. We also have processes in place to forecast revenue and profit on a quarterly basis, to quantify whether we expect to realize our financial targets, and to identify any deviations from plan. We continuously monitor the affected operating segments and board areas in the SAP Group to analyze their developments and define any appropriate actions. Our entire network of planning, controlling, and reporting processes is implemented in integrated planning and information systems, based on SAP software, across all organizational units so that we can conduct the evaluations and analyses needed to make informed decisions. Financial targets for headcount and expenses are substantially based on our topline ambitions. If we determine that SAP’s topline plans are at material risk of not being achieved, we need to be agile and ensure that planned expenses are still properly aligned to the Company’s overall financial ambition.
Non-IFRS Financial Measures Cited in This Report
Explanation of Non-IFRS Measures
We disclose certain financial measures that are not prepared in accordance with IFRS and are therefore considered non-IFRS financial measures. Our non-IFRS financial measures may not correspond to non-IFRS financial measures that other companies report. The non-IFRS financial measures that we report should only be considered in addition to, and not as substitutes for, nor as superior to, our IFRS financial measures.
We believe that the supplemental historical and prospective non-IFRS financial information we disclose is useful to investors because it is used by our management, in addition to financial data prepared in accordance with IFRS, to gain a more transparent understanding of our past performance and our anticipated future results.
We use the non-IFRS measures consistently in our internal planning and forecasting, reporting, and compensation, as well as in our external communications, as follows:
- Our management primarily uses the non-IFRS measures, rather than the IFRS measures, as the basis for making financial, strategic, and operating decisions.
- | The variable components of our Executive Board members’ and employees’ remuneration are based on non-IFRS numbers rather than the respective IFRS measures. Although we exclude expenses related to regulatory compliance matters from non-IFRS results, starting in 2025 we no longer adjust for these expenses when determining the Executive Board members’ remuneration. |
- The annual budgeting process for all management units is based on operating profit (non-IFRS) numbers rather than the respective IFRS financial measure.
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- All forecast and performance reviews with all senior managers globally are based on the non-IFRS measures, rather than the respective IFRS financial measures.
- Both our internal performance targets and the guidance we provide to the capital markets are based on non-IFRS measures, rather than the respective IFRS financial measures.
Our non-IFRS financial performance measures reflect adjustments based on the items below, as well as adjustments for the related income tax effects.
Operating Expense (Non-IFRS)
Numbers that are identified as operating expenses (non-IFRS) have been adjusted by excluding the following expenses:
- Acquisition-related charges
| ■ | Amortization expense/impairment charges for intangibles acquired in business combinations, including goodwill, and certain stand-alone acquisitions of intellectual property (including purchased in-process research and development) |
| ■ | Settlements of preexisting business relationships in connection with a business combination |
| ■ | Acquisition-related third-party expenses |
- Restructuring expenses in accordance with IFRS. These costs are recognized when the Company has committed to a formal restructuring program, and a constructive obligation exists. For more information about our restructuring expenses, see the Notes to the Consolidated Financial Statements 2025, Note (B.6).
- Expenses for regulatory compliance matters associated with the provision for (potential) penalties arising from certain ongoing governmental investigations into our business operations, which are described in the Notes to the Consolidated Financial Statements 2025, Note (G.3), and are strictly limited to the scope of IAS 37.
– Expenses related to the Teradata litigation. These expenses include legal fees and expenses from settlements, or damages awarded in court, and are strictly limited to the scope of IAS 37. For more information about the Teradata litigation, see the Notes to the Consolidated Financial Statements 2025, Note G.3).
We exclude certain acquisition-related expenses for the purpose of calculating operating profit (non-IFRS) and operating margin (non-IFRS) when evaluating SAP’s continuing operational performance, because these expenses generally cannot be changed or influenced by management after the relevant acquisition other than by disposing of the acquired assets. Since management at levels below the Executive Board does not influence these expenses, we generally do not consider these expenses for the purpose of evaluating the performance of management units. We also exclude restructuring expenses because they are volatile and generally cannot be influenced by management at levels below the Executive Board. Furthermore, we exclude expenses for regulatory compliance matters, as these expenses are non-recurring and relate to conduct that took place in prior performance periods, so that users of our consolidated financial statements and the combined management report can see the information that our management uses to manage the business.
Effective 2025, numbers that are identified as operating profit (non-IFRS) are adjusted by excluding expenses related to the Teradata litigation, since these fees and expenses are not indicative of our operating performance or management’s allocation of resources to our ongoing business activities. By excluding these non-recurring expenses, SAP will provide additional insight into its operating performance, increase period-over-period comparability, and provide users of SAP’s financial statements the information that our management uses to manage the business.
Non-Operating Income, Net (Non-IFRS)
Numbers that are identified as non-operating income, net (non-IFRS) have been adjusted by excluding the following effects:
- Acquisition-related charges
| ■ | Net disposal gains and losses arising from the sale of intangibles acquired in business combinations |
Consistent with the adjustments we make to our operating expenses (non-IFRS) by excluding amortization expenses and impairment charges for intangibles acquired in business combinations, we adjust our non-operating income, net (non-IFRS) by excluding disposal gains and losses arising from the sale of these intangibles. These net disposal gains and losses are not indicative of SAP’s operations. We believe that by excluding these gains and losses, we improve our period-over-period comparability.
Financial Income, Net (Non-IFRS)
Numbers that are identified as financial income, net (non-IFRS) have been adjusted by excluding the following gains and losses:
- Gains and losses from equity securities, net
| ■ | Includes realized and unrealized effects from the disposal of equity securities, ongoing mark-to-market adjustments on marketable equity investments, changes in fair value of non-marketable equity securities, and others. |
Excluding gains and losses from equity securities, net, improves the period-over-period comparability by reducing volatility caused by share price fluctuation, market developments, and other factors beyond our control.
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Effective Tax Rate (Non-IFRS)
The effective tax rate (non-IFRS) 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 investments, which are reconciling items between the two effective tax rates (non-IFRS and IFRS). These items cannot be provided without unreasonable efforts, but they could have a significant impact on our future effective tax rate (IFRS).
Constant Currencies Information
We believe it is important for investors to have information that provides insight into the development of our sales. Revenue measures determined under IFRS provide information that is useful in this regard. However, both sales volume and currency effects impact period-over-period changes in sales revenue. We do not sell standardized units of products and services so we cannot provide relevant information on sales volume by providing data on the changes in product and service units sold. To provide additional information that may be useful to investors in breaking down and evaluating changes in sales volume, we present information about our revenue and about various values and components relating to operating profit that are adjusted for foreign currency effects. We calculate constant currency measures by translating foreign currencies using the average exchange rates from the comparative period instead of the current period. Constant currency values for our current cloud backlog and total cloud backlog measures use the closing exchange rate from the previous year’s corresponding key date instead of the average exchange rate.
Free Cash Flow
Among other measures, we use free cash flow to manage our overall financial performance. In 2025, we revised our definition of free cash flow so that it now includes the proceeds from sales of intangible assets and property, plant, and equipment, and therefore better reflects how SAP’s management evaluates the cash flow generated by operating activities after investments in long-term assets and leasing. We define free cash flow as net cash from operating activities adjusted for purchases of intangible assets and property, plant, and equipment; for proceeds from sales of intangible assets and property, plant, and equipment; and for payments of lease liabilities. Further impacting our free cash flow, effective 2025 we no longer include interest paid and interest received in net cash flows from operating activities. For more information, see the Notes to the Consolidated Financial Statements 2025, Note (IN.1). Prior year amounts were adjusted accordingly.
Usefulness of Non-IFRS Measures
We believe that our non-IFRS measures are useful to investors for the following reasons:
- Our non-IFRS measures provide investors with insight into management’s decision-making because management uses these measures to run our business and make financial, strategic, and operating decisions. We exclude the expense adjustments outlined above when making decisions to allocate resources. In addition, we use these non-IFRS measures to facilitate comparisons of SAP’s operating performance from period to period.
- The non-IFRS measures provide investors with additional information that enables a comparison of year-over-year operating and non-operating performance by excluding certain direct effects of acquisitions, restructuring plans, regulatory compliance matters, the Teradata litigation, and gains and losses from equity securities, net.
- Non-IFRS and non-GAAP (Generally Accepted Accounting Principles) measures are widely used in the software industry. In many cases, our non-IFRS measures may facilitate comparisons with our competitors’ corresponding non-IFRS and non-GAAP measures.
Limitations of Non-IFRS Measures
Without being analyzed in conjunction with the corresponding IFRS measures, the non-IFRS measures are not indicative of our present and future performance primarily for the following reasons:
| - | While our profit (non-IFRS) numbers reflect the elimination of certain acquisition-related expenses, no eliminations are made for the additional revenue or other income that results from the acquisitions. |
| - | The acquisition-related amortization expense that we eliminate in deriving our profit (non-IFRS) numbers is a recurring expense that will impact our financial performance in future years. |
| - | The remaining acquisition-related charges that we eliminate in deriving our profit (non-IFRS) numbers are likely to recur if SAP enters into business combinations in the future. Similarly, the restructuring expenses that we eliminate in deriving our profit (non-IFRS) numbers are likely to recur if SAP restructures its operations in the future. |
| - | The expense adjustment for acquisition-related charges does not arise from a common conceptual basis. This is because the expense adjustment aims to improve comparability between post-acquisition periods and pre-acquisition periods. This should particularly be considered when evaluating our operating profit (non-IFRS) and operating margin (non-IFRS) numbers, as these combine our revenue and expenses (non-IFRS) despite the absence of a common conceptual basis. |
| - | Our restructuring charges resulted in significant cash outflows in the past and could do so in the future. |
| - | Expenses ascribed to regulatory compliance matters may include penalties and legal costs, and expenses ascribed to the Teradata Litigation may include legal costs, expenses from settlements, and damages awarded in court, all of which would impact the operating cash flows of the business. |
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| - | The gains and losses from equity securities, net, that we eliminate in deriving our financial income, net (non-IFRS) numbers are recurring effects that have impacted our financial performance in the past and will do so in the future. Similarly, the acquisition-related effects related to the sale of intangibles arising from business combinations that we eliminate in deriving our non-operating income, net (non-IFRS) have impacted our financial performance in the past and could do so in the future. |
| - | Our realized net gains from equity securities resulted in significant cash inflows in the past and could do so in the future. |
We believe that constant currency measures have limitations, particularly as the currency effects that are eliminated constitute a significant element of our revenue and expenses and could materially impact our performance.We therefore limit our use of constant currency measures to the analysis of changes in volume as one element of the full change in a financial measure.
Despite these limitations, we believe that the presentation of our non-IFRS measures and the corresponding IFRS measures, together with the relevant reconciliations, provides useful information to management and investors about present and future business trends relating to our financial condition and results of operations.
Reconciliation of IFRS to Non-IFRS Financial Measures for 2025 and 2024
Reconciliation of Non-IFRS Revenue
2025 | 2024 | |||||||
| | | Non-IFRS | | ||||
Currency | Constant | |||||||
€ millions, unless otherwise stated | IFRS | Impact | Currency | IFRS | ||||
Revenue Numbers |
| |
| |
| |
| |
Cloud |
| 21,023 |
| 637 |
| 21,661 |
| 17,141 |
Software licenses |
| 990 |
| 31 |
| 1,020 |
| 1,399 |
Software support |
| 10,525 |
| 229 |
| 10,754 |
| 11,290 |
Software licenses and support |
| 11,515 |
| 259 |
| 11,774 |
| 12,689 |
Cloud and software |
| 32,538 |
| 897 |
| 33,435 |
| 29,830 |
Services |
| 4,262 |
| 107 |
| 4,369 |
| 4,346 |
Total revenue |
| 36,800 |
| 1,004 |
| 37,804 |
| 34,176 |
Reconciliation of Non-IFRS Operating Expenses
2025 | 2024 | |||||||||||||||
| | | Non-IFRS | | ||||||||||||
| Currency |
| Constant |
|
|
| ||||||||||
€ millions, unless otherwise stated |
| IFRS | Adj. | Non-IFRS | Impact |
| Currency |
| IFRS |
| Adj. |
| Non-IFRS | |||
Operating Expense Numbers | ||||||||||||||||
Cost of cloud |
| -5,480 |
| 214 |
| -5,266 |
|
|
| -4,660 |
| 78 |
| -4,582 | ||
Cost of software licenses and support |
| -1,313 |
| 116 |
| -1,196 |
|
|
| -1,262 |
| 0 |
| -1,262 | ||
Cost of cloud and software |
| -6,793 |
| 330 |
| -6,463 |
|
|
| -5,922 |
| 78 |
| -5,844 | ||
Cost of services |
| -3,193 |
| 1 |
| -3,192 |
|
|
| -3,321 |
| 1 |
| -3,321 | ||
Total cost of revenue |
| -9,986 |
| 331 |
| -9,655 |
|
|
| -9,243 |
| 79 |
| -9,165 | ||
Gross profit |
| 26,814 |
| 331 |
| 27,145 |
| 705 |
| 27,851 |
| 24,932 |
| 79 |
| 25,011 |
Research and development |
| -6,633 |
| 5 |
| -6,628 |
|
|
| -6,514 |
| 5 |
| -6,508 | ||
Sales and marketing |
| -8,879 |
| 299 |
| -8,580 |
|
|
| -9,090 |
| 234 |
| -8,856 | ||
General and administration |
| -1,633 |
| 163 |
| -1,470 |
|
|
| -1,435 |
| 27 |
| -1,409 | ||
Restructuring |
| -3 |
| 3 |
| 0 |
|
|
| -3,144 |
| 3,144 |
| 0 | ||
Other operating income/expense, net |
| -49 |
| 0 |
| -49 |
|
|
| -85 |
| 0 |
| -85 | ||
Total operating expenses |
| -27,183 |
| 801 |
| -26,382 |
| -762 |
| -27,143 |
| -29,511 |
| 3,489 |
| -26,022 |
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Reconciliation of Non-IFRS Profit Numbers, Income Tax Expense, and Key Ratios
2025 | 2024 | |||||||||||||||
| | | Non-IFRS | | ||||||||||||
| Currency |
| Constant |
|
|
| ||||||||||
€ millions, unless otherwise stated |
| IFRS | Adj. | Non-IFRS | Impact |
| Currency |
| IFRS |
| Adj. |
| Non-IFRS | |||
Profit Numbers | ||||||||||||||||
Operating profit (loss) |
| 9,617 |
| 801 |
| 10,419 |
| 242 |
| 10,661 |
| 4,665 |
| 3,489 |
| 8,153 |
Other non-operating income/expense, net |
| 118 |
| 0 |
| 118 |
|
|
| -298 |
| 0 |
| -298 | ||
Finance income |
| 1,911 |
| -1,389 |
| 522 |
|
|
| 1,429 |
| -777 |
| 652 | ||
Finance costs |
| -1,377 |
| 625 |
| -751 |
|
|
| -1,031 |
| 316 |
| -715 | ||
Financial income, net |
| 534 |
| -764 |
| -230 |
|
|
| 398 |
| -461 |
| -63 | ||
Profit (loss) before tax from continuing operations |
| 10,270 |
| 38 |
| 10,307 |
|
|
| 4,764 |
| 3,028 |
| 7,792 | ||
Income tax expense |
| -2,944 |
| -198 |
| -3,142 |
|
|
| -1,614 |
| -899 |
| -2,513 | ||
Profit (loss) after tax from continuing operations |
| 7,326 |
| -161 |
| 7,165 |
|
|
| 3,150 |
| 2,129 |
| 5,279 | ||
Attributable to owners of parent |
| 7,161 |
| -5 |
| 7,156 |
|
|
| 3,124 |
| 2,162 |
| 5,286 | ||
Attributable to non-controlling interests |
| 165 |
| -156 |
| 10 |
|
|
| 26 |
| -33 |
| -7 | ||
Profit (loss) after tax1 | 7,326 | -161 | 7,165 | 3,150 | 2,129 | 5,279 | ||||||||||
Attributable to owners of parent1 | 7,161 | -5 | 7,156 | 3,124 | 2,162 | 5,286 | ||||||||||
Attributable to non-controlling interests1 | 165 | -156 | 10 | 26 | -33 | -7 | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Key Ratios |
|
|
|
|
|
|
|
| ||||||||
Operating margin (in %) |
| 26.1 |
|
| 28.3 |
|
| 28.2 |
| 13.6 |
|
| 23.9 | |||
Effective tax rate (in %) |
| 28.7 |
|
| 30.5 |
|
|
| 33.9 |
|
| 32.3 | ||||
Earnings per share, basic (in €) from continuing operations | 6.14 | 6.14 | 2.68 | 4.53 | ||||||||||||
Earnings per share, basic (in €)1 |
| 6.14 |
|
| 6.14 |
|
|
| 2.68 |
|
| 4.53 | ||||
1 from continuing and discontinued operations
Reconciliation of Operating Cash Flow from Continuing Operations to Free Cash Flow
€ millions | | 2025 | | 2024 |
Net cash flows from operating activities – continuing operations |
| 9,156 |
| 5,207 |
Purchase of intangible assets and property, plant, and equipment |
| -739 |
| -797 |
Proceeds from sales of intangible assets and property, plant, and equipment | 121 | 122 | ||
Payments of lease liabilities |
| -299 |
| -310 |
Free cash flow |
| 8,239 |
| 4,222 |
Net cash flows from investing activities – continuing operations |
| -965 |
| -93 |
Net cash flows from financing activities – continuing operations |
| -8,745 |
| -3,961 |
The free cash flow definition was revised in the reporting year to include proceeds from sales of intangible assets and property, plant, and equipment. For more information, see Free Cash Flow in the Performance Management System section. Additionally as of 2025, interest paid and interest received are no longer part of the net cash flows from operating activities. For more information, see the Notes to the Consolidated Financial Statements 2025, Note (IN.1). The comparison year has been retrospectively adjusted to conform with the new definition.
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Non-IFRS Operating Expense Adjustments by Functional Areas
2025 | 2024 | |||||||||||||||||||||||
| | Acquisition- | | | | Teradata | | | | Acquisition- | | | | Teradata | | |||||||||
€ millions | IFRS | Related | Restructuring | RCM1 | litigation | Non-IFRS | IFRS | Related | Restructuring | RCM1 | litigation | Non-IFRS | ||||||||||||
Cost of cloud |
| -5,480 |
| 98 |
| 0 |
| 0 | 116 |
| -5,266 |
| -4,660 |
| 78 |
| 0 |
| 0 | 0 |
| -4,582 | ||
Cost of software licenses and support | -1,313 | 0 | 0 | 0 | 116 | -1,196 | -1,262 | 0 | 0 | 0 | 0 | -1,262 | ||||||||||||
Cost of services |
| -3,193 |
| 1 |
| 0 |
| 0 | 0 |
| -3,192 |
| -3,321 |
| 1 |
| 0 |
| 0 | 0 |
| -3,321 | ||
Research and development |
| -6,633 |
| 5 |
| 0 |
| 0 | 0 |
| -6,628 |
| -6,514 |
| 5 |
| 0 |
| 0 | 0 |
| -6,508 | ||
Sales and marketing |
| -8,879 |
| 299 |
| 0 |
| 0 | 0 |
| -8,580 |
| -9,090 |
| 255 |
| 0 |
| -22 | 0 |
| -8,856 | ||
General and administration |
| -1,633 |
| 8 |
| 0 |
| 0 | 155 |
| -1,470 |
| -1,435 |
| 16 |
| 0 |
| 11 | 0 |
| -1,409 | ||
Restructuring |
| -3 |
| 0 |
| 3 |
| 0 | 0 |
| 0 |
| -3,144 |
| 0 |
| 3,144 |
| 0 | 0 |
| 0 | ||
Other operating income/expense, net |
| -49 |
| 0 |
| 0 |
| 0 | 0 |
| -49 |
| -85 |
| 0 |
| 0 |
| 0 | 0 |
| -85 | ||
Total operating expenses |
| -27,183 |
| 411 |
| 3 |
| 0 | 387 |
| -26,382 |
| -29,511 |
| 356 |
| 3,144 |
| -11 | 0 |
| -26,022 | ||
1 Regulatory compliance matters
Reconciliation of non-IFRS Profit Before Tax
€ millions | | 2025 | | 2024 |
Profit before tax from continuing operations (IFRS) |
| 10,270 |
| 4,764 |
Adjustment for acquisition-related changes |
| 411 |
| 356 |
Adjustment for restructuring expenses |
| 3 |
| 3,144 |
Adjustment for regulatory compliance matter expenses |
| 0 |
| -11 |
Adjustment for the Teradata litigation expenses |
| 387 |
| 0 |
Adjustment for gains and losses from equity securities, net |
| -764 |
| -461 |
Profit before tax from continuing operations (non-IFRS) |
| 10,307 |
| 7,792 |
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PART I
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
Not applicable.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
Not applicable.
ITEM 3. KEY INFORMATION
Exchange Rates
The sales prices for our ordinary shares traded on German stock exchanges are denominated in euro. Fluctuations in the exchange rate between the euro and the U.S. dollar affect the dollar equivalent of the euro price of the ordinary shares traded on the German stock exchanges and, as a result, may affect the price of the ADRs traded on the New York Stock Exchange (NYSE) in the United States. See “Item 9. The Offer and Listing” for a description of the ADRs. In addition, SAP SE pays cash dividends, if any, in euro. As a result, any exchange rate fluctuations will also affect the dollar amounts received by the holders of ADRs on the conversion into dollars of cash dividends paid in euro on the ordinary shares represented by the ADRs. Deutsche Bank Trust Company Americas is the depositary (the Depositary) for SAP SE’s ADR program. The deposit agreement with respect to the ADRs requires the Depositary to convert any dividend payments from euro into dollars as promptly as practicable upon receipt. For additional information on the Depositary and the fees associated with SAP’s ADR program see “Item 12. Description of Securities Other Than Equity Securities — American Depositary Shares.”
For details on the impact of exchange rate fluctuations see “Item 5. Operating and Financial Review and Prospects — Foreign Currency Exchange Rate Exposure”.
Dividends
Dividend Distribution Policy
Dividends are jointly proposed by SAP SE’s Supervisory Board (Aufsichtsrat) and Executive Board (Vorstand) based on SAP SE’s year-end stand-alone statutory financial statements, subject to approval by the Annual General Meeting of Shareholders. Our dividend policy is to pay a dividend of at least 40% of the SAP Group’s non - IFRS profit after tax from continuing operations. Dividends are officially declared for the prior year at SAP SE’s Annual General Meeting of Shareholders. SAP SE’s Annual General Meeting of Shareholders usually convenes during the second quarter of each year. Following joint market standards in Europe for corporate actions processing, dividends are remitted to the custodian bank on behalf of the shareholders on the third business day following the Annual General Meeting of Shareholders. Record holders of the ADRs on the dividend record date will be entitled to receive payment of the dividend declared in respect of the year for which it is declared. Cash dividends payable to such holders will be paid to the Depositary in euro and, subject to certain exceptions, will be converted by the Depositary into U.S. dollars.
Dividends paid to holders of the ADRs may be subject to German withholding tax. See “Item 10. Additional Information — Taxation,” for further information.
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Annual Dividends Paid and Proposed
The following table sets forth in euro the annual dividends paid or proposed to be paid per ordinary share in respect of each of the years indicated. One SAP ADR currently represents one SAP SE ordinary share. Accordingly, the final dividend per ADR is equal to the dividend for one SAP SE ordinary share and is dependent on the euro/U.S. dollar exchange rate. The table does not reflect tax credits that may be available to German taxpayers who receive dividend payments. If you own our ordinary shares or ADRs and if you are a U.S. resident, refer to “Item 10. Additional Information — Taxation,” for further information.
Dividend Paid per Ordinary Share |
| ||||
Year Ended December 31, | € | US$ |
| ||
2021 |
| 2.45 | 4 | 2.61 | 1 |
2022 |
| 2.05 | 2.23 | 1 | |
2023 |
| 2.20 | 2.37 | 1 | |
2024 |
| 2.35 | 2.62 | 1 | |
2025 (proposed) | 2.50 | 2 | 2.95 | 2, 3 | |
1 Translated for the convenience of the reader from euro into U.S. dollars at the Noon Buying Rate for converting euro into U.S. dollars on the dividend payment date. The Depositary is required to convert any dividend payments received from SAP as promptly as practicable upon receipt.
2 Subject to approval at the Annual General Meeting of Shareholders of SAP SE currently scheduled to be held on May 5, 2026.
3 Translated for the convenience of the reader from euro into U.S. dollars at the Noon Buying Rate for converting euro into U.S. dollars on February 5, 2026 of US$1.18 per €1.00. The dividend paid may differ due to changes in the exchange rate.
4 Includes special increase of €0.50 to celebrate SAP’s 50th anniversary.
The amount of dividends paid on the ordinary shares depends on the amount of non - IFRS profits to be distributed by SAP SE, which depends in part upon our financial performance. The Executive Board and the Supervisory Board of SAP SE will recommend to the Annual General Meeting of Shareholders in May 2026 that the total dividend be €2.50 per share. In addition, the amount of dividends received by holders of ADRs may be affected by fluctuations in exchange rates (see “Item 3. Key Information — Exchange Rates”). The timing, declaration, amount and payment of any future dividend will depend upon our future earnings, capital needs and other relevant factors, in each case as proposed by the Executive Board and the Supervisory Board of SAP SE and approved by the Annual General Meeting of Shareholders.
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Risk Factors
Our operations and financial results are subject to various risks and uncertainties, including those described below, that could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our ADRs and ordinary shares.
Economic, Political, Social, and Regulatory Risks
Global Economic and Political Environment: Uncertainty in the global economy and/or financial markets, and social and political instability caused by state-based conflicts, terrorist attacks, civil unrest, war, or international hostilities could lead to disruptions in our business.
As a global company, we are influenced by multiple external factors that are difficult to predict, may develop quickly, and are beyond our influence and control. These include, among others: crises affecting credit or liquidity markets; regional or global recessions; sharp fluctuations in commodity prices, currency exchange rates or interest rates; inflation or deflation; sovereign debt and bank debt rating downgrades; restructurings or defaults; adverse geopolitical events (such as Russia’s invasion of Ukraine and the Israel - Hamas conflict); rising military tensions around the world (such as the China-Taiwan tensions) and in particular within Europe’s borders; global policy including in the United States, the European Union (EU), Russia, and China; and global pandemic diseases such as COVID-19.
Any of these events could have an adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
International Laws and Regulations: Laws, regulatory requirements and standards in Germany, the United States, and elsewhere continue to be very stringent. Our international business activities and processes expose us to numerous and often conflicting laws and regulations, policies, standards, or other requirements, and sometimes even conflicting regulatory requirements.
The SAP Group has a global presence and operates in most countries of the world. As a European company domiciled in Germany with securities listed in Germany and the United States, we are subject to European, German, U.S., and other governance-related regulatory requirements of the countries we operate in.
Our business is subject to numerous risks inherent to international business operations and associated consequences, such as changes in tax laws, changes in external reporting standards, and the interpretation of the complex tax rules in certain countries, including but not limited to conflict and overlap among tax regimes as well as the introduction of new tax concepts that harm digitalized business models; discriminatory, protectionist, or conflicting fiscal policies and tax laws; import and export regulations and trade sanctions; counter or even conflicting sanctions; embargoes, including but not limited to country-specific software certification requirements; and newly emerging cybersecurity and environmental, social, and governance (ESG) compliance and disclosure laws.
As we expand into new countries and markets or extend our business activities in these markets, including emerging and high-risk markets, these risks could intensify. The application of the respective local laws and regulations to our business is sometimes unclear, subject to change over time, and often conflicting among jurisdictions. Additionally, these laws and government approaches to enforcement continue to change and evolve, just as our products and services continually evolve. Compliance with these varying laws and regulations (including, and in particular, global anti-trust regulations) could involve significant costs or require changes in our products or business practices. Non-compliance could result in the imposition of penalties or cessation of orders due to alleged non-compliant activity. Governmental authorities could use considerable discretion in applying these statutes and any imposition of sanctions against us could be material.
Any of these events could have a material adverse effect on our operations globally or in one or more countries or regions, which could have a material adverse effect on our business, financial position, profit, and cash flows.
Legal and IP: Claims and lawsuits against us, such as for IP infringements or breaches of contract, or our inability to obtain or maintain adequate licenses for third-party technology, or if we are unable to protect or enforce our own intellectual property, may result in adverse outcomes.
We have in the past, and believe that we will continue to be, subject to claims and lawsuits, including intellectual property infringement claims, as our solution portfolio grows; as we acquire companies with increased use of third-party code including open source code; as we expand into new industries with our offerings, resulting in greater overlap in the functional scope of offerings; and as non-practicing entities that do not design, manufacture, or distribute products assert intellectual property infringement claims. Also, we have been in the past, and believe that we may continue to be in the future, subject to claims and lawsuits alleging competition and antitrust law violations. Such allegations, for example, often arise from competitors and third parties claiming broad access rights to SAP data.
Moreover, protecting and defending our intellectual property is crucial to our success. The outcome of litigation and other claims or lawsuits is intrinsically uncertain.
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We are subject to risks and associated consequences in the following areas, among others: data access and other antitrust-based claims, for example alleged lock-in effects, dependency in the aggregate on third-party technology, including cloud and Web services, that we embed in our products or that we resell to our customers; integration of open source software components from third parties into our software and the implications derived from it; inability to prevent third parties from obtaining, using, or selling without authorization what we regard as our proprietary technology and information; and the possibility that third parties might reverse-engineer or otherwise obtain and use technology and information that we regard as proprietary. Moreover, the laws and courts of certain countries might not offer effective means for us to enforce our legal or intellectual property rights and successfully defend allegations. Finally, SAP might face significant adverse rulings in commercial disputes or might not be able to collect or otherwise enforce all judgments awarded to it in legal proceedings. The outcome of litigation and other claims or lawsuits is intrinsically uncertain. Management’s view of the litigation might also change in the future. Actual outcomes of litigation and other claims or lawsuits could differ from the assessments made by management in prior periods, which are the basis for our accounting for these litigations and claims under IFRS.
Data Protection and Privacy: Non-compliance with increasingly complex and stringent, sometimes even conflicting, applicable data protection and privacy laws, or failure to meet the contractual requirements of SAP’s customers with respect to our products and services, could lead to civil liabilities and fines, as well as loss of customers.
As a global software and service provider, SAP is required to comply with local laws wherever it does business. One of the relevant European data protection laws is the General Data Protection Regulation. International data transfers to third countries that do not provide an adequate level of data protection require additional safeguards, including transfer risk assessments, to justify a transfer from the EU to a third country under the applicable EU Standard Contractual Clauses (SCC). In addition, other countries establish safeguards to justify data transfers to further countries, by implementing their own standard contractual clauses. Examples include Türkiye’s Personal Data Protection Law, China’s Personal Information Protection Law, and Saudi Arabia’s Personal Data Protection Law, which also imposes requirements regarding data localization.
Furthermore, data protection and privacy laws, regulations, and other standards around the world are evolving to better protect individuals’ personal information, particularly in marketing activities and tracking of online behavior. This may impose additional burdens for SAP due to increasing compliance standards that could restrict the use and adoption of SAP’s products and services (particularly cloud services) and make it more challenging and complex to meet customer expectations. These changing criteria also impact the compliant use of new technology, such as machine learning and Artificial Intelligence for product development and deployment of intelligent applications.
Non-compliance with applicable data protection and privacy laws by SAP or any of the subprocessors engaged by SAP while processing personal data could lead to risks. These include, among others: mandatory disclosure of breaches to affected individuals, customers, and data protection supervisory authorities; investigations and administrative measures by data protection supervisory authorities, such as the instruction to alter or stop non-compliant data processing activities, including the instruction to stop using non-compliant subprocessors; or the possibility of damage claims by customers and individuals, contract terminations, and potential fines.
In addition, the German Federal Office for the Protection of the Constitution and security industry experts continue to warn of risks related to a globally growing number of cybersecurity attacks aimed at obtaining or violating company data including personal data.
Any of these events could have a material adverse effect on our reputation, business, financial performance, competitive or financial position, revenue, profit, and cash flows.
Corporate Governance and Compliance Risks
Ethical Behavior: Our global business exposes us to risks related to unethical behavior and non-compliance with policies by employees, other individuals, partners, third parties, or entities associated with SAP.
SAP’s leadership position in the global market is founded on the long-term and sustainable trust of our stakeholders worldwide. Our overarching approach is one of corporate transparency, open communication with financial markets, regulators, and authorities, and adherence to recognized standards of business integrity. This commitment to recognized standards of business integrity is formalized in SAP’s Global Code of Ethical Business Conduct (CoEBC) and supporting policies and guidelines.
Risks and associated consequences to which SAP is subject include: non-compliance with policies; violation of compliance-related rules, regulations, and legal requirements including, but not limited to, antitrust, anticorruption, and antibribery legislation in Germany, the U.S. Foreign Corrupt Practices Act, the UK Bribery Act, and other applicable laws; collusion with external third parties; fraud and corruption; public sector transactions in territories exposed to a high risk of corruption; or increased exposure and impact on business activities in highly regulated industries, all of which may lead to civil or criminal charges, fines, or claims by affected parties as well as reputational damage.
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, or cash flows. In 2025, SAP continued to strengthen its compliance program and related internal controls in accordance with regulatory expectations and requirements.
Operational Business Risks
Sales and Services: Sales and implementation of SAP software and services, including cloud, are subject to several significant risks sometimes beyond our direct control.
A core element of our business is the successful implementation of software and service solutions. The implementation of SAP software and cloud-based service deliveries is led by SAP, by partners, by customers, or by a combination thereof.
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We are subject to risks and associated consequences in the following areas, among others: implementation risks caused by insufficient or incorrect information provided by customers, insufficient customer expectation management, including scope, integration capabilities and aspects, and a lack of purposeful selection, implementation, or utilization of SAP solutions; a lack of customer commitments and respective engagements; challenges to achieve a seamlessly integrated, sufficiently automated and aligned service delivery; unrenderable services committed during the sales stage; inadequate contracting and consumption models based on subscription models for services, support, and application management; deviations from standard terms and conditions; or statements concerning solution developments that might be misperceived by customers as commitments on future software functionalities.
Any of these events could have an adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
Partner Ecosystem: If we are unable to scale, maintain, and enhance an effective partner ecosystem, revenue might not increase as expected.
An open and vibrant partner ecosystem is a fundamental pillar of our success and growth strategy. We have entered into partnership agreements that drive co-innovation on our platforms, profitably expand our routes to market to optimize market coverage, optimize cloud delivery, and provide high-quality services capacity in all market segments. Partners play a key role in driving market adoption of our entire solutions portfolio, by co-innovating on our platforms, embedding our technology, and reselling or implementing our software.
We are subject to risks and associated consequences in the following areas, among others: failure to establish and enable a network of qualified and fully committed partners; failure of partners to develop sufficient innovative solutions and content on our platforms or to provide high-quality products or services to meet customer expectations; failure of partners to embed our solutions sufficiently enough to profitably drive product adoption; failure of partners to adhere to applicable legal and compliance regulations; failure of partners to transform their business model in accordance with the transformation of SAP’s business model in a timely manner; and failure of partners to comply with contract terms in embargoed or high-risk countries.
If any of these risks materialize, this might adversely affect the demand for our products and services as well as the partner’s loyalty and ability to deliver. As a result, we might not be able to scale our business to compete successfully with other vendors, which could have an adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
Cloud Operations: We may not be able to properly protect and safeguard our critical information and assets, business operations, cloud offerings and portfolio presentation, and related infrastructure against cyberattacks, insufficient infrastructure, disruption, or deficient performance.
SAP is highly dependent on the availability, integrity, and reliability of our infrastructure, including infrastructure provided by third-party business partners, and the software used in our cloud portfolio is inherently complex. Customers using our cloud services rely on the security of our infrastructure to protect the availability of our services and the data that they store on our infrastructure. Threat actors are focused on attacking third-party product and service providers, such as SAP, as a means of compromising our and our downstream customers’ systems and data.
We are subject to risks and associated consequences in the following areas, among others: the cloud portfolio or strategic direction of cloud operations may not fully meet customer demands; customers’ cloud service demands may not match our data center capacity or control investments; capacity shortages could affect SAP’s ability to deliver and operate cloud services as expected by or committed to our customers; scalability demands on infrastructure and operation could lead to cost increases and margin impacts; hyperscaler or infrastructure instabilities and the lack of availability or comprehensive contractual agreements could lead to challenges in meeting service level agreement (SLA) commitments; we might lack sufficient “future skills” for delivering and operating hybrid environments; we might lack the automation, standardization, and tools to manage and optimize operations and infrastructure; local legal requirements or changes to data sovereignty may lead to customers relocating their landscapes to a different data center; the loss of the right to use hardware purchased or leased from third parties could affect our ability to provide our cloud applications; disruptions to SAP’s cloud applications portfolio (such as system outages or downtimes, SAP network failure due to human or other errors, security breaches, or variability in user traffic for cloud applications) could affect customer SLAs; hardware failures or system errors might result in data loss or corruption; partner co-location of data centers might not adhere to our quality standards; or we might not comply with applicable certification requirements, such as the Payment Card Industry Data Security Standard (PCI DSS).
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
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Cybersecurity and Security: Cybersecurity attacks or breaches, and security vulnerabilities in our infrastructure or services or those of our third-party partners could materially impact our business operations, products, and service delivery.
SAP delivers a full portfolio of solutions, hosts or manages elements of our customers’ businesses in the cloud, processes large amounts of data, and provides mobile solutions to users either directly or through partners and other third parties. This frequently involves incorporating third-party data, products, and services into SAP products and services. SAP operates complex cloud services across diverse architectures, with services implemented through SAP’s own cloud and data centers as well as through hyperscalers.
Our industry contends with a complex and evolving cybersecurity landscape, facing increasingly sophisticated attacks that can leverage AI and cloud scale or exploit known and unknown “zero-day” security vulnerabilities in our or our customers’ systems or software. These cybersecurity threats can arise from our or our customers’ failure to patch such vulnerabilities in a timely or effective manner. Geopolitical tensions can exacerbate such threats, and hybrid warfare between nation states can include cybersecurity attacks on private companies, targeting IT products, businesses, and the supply chain. Like many companies, SAP and certain of our third-party partners have experienced and expect to continue to experience cyberattacks and other security incidents that could affect our business. However, we are not aware of any such incidents that have had a material impact on our business.
When we become aware of unauthorized access to our systems or those of our third-party partners, we have action plans in place intended to identify and remediate the source and impact of such events.
The scanning tools we deploy across our networks and products regularly identify and track security vulnerabilities, which are prioritized based on known and anticipated risks, and our remediation activities aim to patch vulnerabilities within the designated timeframes.
While we have implemented patch management processes, we may be unable to comprehensively apply patches, or to confirm that mitigating measures address all vulnerabilities or that patches will be applied before exploitation by threat actors. Vulnerabilities may persist if customers do not apply patches, update systems, or authorize the service downtime required for patching by SAP. If attackers can exploit vulnerabilities before patches are installed or mitigating measures are implemented, significant compromises could impact our and our customers’ systems and data.
We could also experience material exposure to our business operations and service delivery due to disruptions in backups, in disaster recovery processes, or in business-continuity management processes, or as the result of malicious or inadvertent actions by employees, contractors, or other parties. Security threats may also exist due to delayed or insufficient responses to identified issues or other interdependencies such as cloud service providers and those threats beyond SAP’s cybersecurity infrastructure and protocols.
SAP and/or its partners may have inadequate security controls or insufficient compliance with existing controls, which could impact SAP’s and/or its partners’ ability to comply with applicable regulations and customer requirements. SAP and/or its partners could unknowingly introduce security threats and vulnerabilities if they have not established relevant security evaluation processes. Failure to integrate or maintain SAP’s cybersecurity framework and protocols with network systems obtained through acquisitions could also introduce cybersecurity vulnerabilities.
Technology and Products: Our technology and products may experience undetected defects, coding or configuration errors, may not integrate as expected, or may not meet customer expectations.
We are subject to risks and associated consequences in the following areas, among others: failure of software products and services to fully meet market needs or customer expectations; failure of software products and services from acquired companies to fully comply with SAP quality standards; failure of new products, services, and cloud offerings, including third-party technologies, to comply with local standards and requirements; the possibility that new products, services, and cloud offerings or subsequent versions and updates to existing products, services, and cloud offerings might contain defects or security vulnerabilities, or might not be mature enough from the customer’s point of view for business-critical solutions, or might not be sufficiently secure after release or shipment despite all the due diligence SAP puts into quality; inability of algorithms to correctly adapt to evolving circumstances, which may lead to adverse decision-making processes in the context of AI-related technologies; and the inability to fulfil expectations of customers regarding time and quality in the defect resolution process.
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
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Strategic Risks
Market Share and Profit: Our market share and profit could decline due to increased competition, market consolidation, technological innovation, and new business models in the software industry.
The market for cloud computing is increasingly competitive and is exhibiting strong growth relative to the market for on-premise solutions. To maintain or improve our operating results in the cloud business, it is important that we not only attract new customers but also that our existing customers renew their agreements with us when the initial contract term expires and purchase additional modules or additional capacity. Additionally, we need to bring innovations to the market in line with the demands of our ecosystem and ahead of our competitors, such as solutions to support new data-driven applications and the extension of our suite of intelligent technologies based on SAP Business Technology Platform (SAP BTP).
We are subject to risks and associated consequences in the following areas, among others: inability to deliver fully suitable solution and transformation services to our customers on the cloud transformation journey, both in cloud-only and hybrid scenarios; inability to successfully execute on our hyperscaler strategy; adverse, near-term revenue effects due to increasing cloud business and conversions from on-premise licenses to cloud subscriptions from existing SAP customers, which could have an adverse effect on related maintenance and services revenue; insufficient solution and service adoption together with increased complexity, as well as failures during the execution of our corporate strategy in the context of our portfolio for solutions and services, which could lead to a loss of SAP’s position as a leading cloud company and subsequently to reduced customer adoption; customers and partners being reluctant or unwilling to migrate and adapt to the cloud; customers considering cloud offerings from our competitors; strategic alliances among competitors; price pressure, cost increases, and loss of market share through traditional, new, and cooperating competitors and hyperscalers; and the inability to achieve the planned margin increase in time as planned.
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
Mergers and Acquisitions: We might not acquire, integrate, or divest companies or their components effectively or successfully.
To expand and consolidate our business, we acquire and divest businesses, products, and technologies, and we expect to continue doing so in the future. Over time, some of these acquisitions have increased in size and in strategic importance for SAP. Management negotiation of potential acquisitions and divestures and the integration and carve-out of acquired businesses, products, or technologies demands time, focus, and resources of both management and the workforce, and exposes us to unpredictable operational difficulties.
We are subject to risks and associated consequences in the following areas, among others: incorrect information or assumptions during the due diligence process for acquisitions, divestitures, and other transactions; failure to integrate acquired technologies or solutions successfully and profitably into SAP’s solution portfolio and strategy; failure to successfully integrate acquired entities and their operations; failure to fulfill the needs of the acquired company’s customers or partners; failure to implement, restore, or maintain internal controls, disclosure controls, and procedures and policies within acquired companies; debt incurrence or significant unexpected cash expenditures; impairment of goodwill and other intangible assets acquired in business combinations; and failure of acquired companies to comply with regulatory requirements.
We have in the past, and may in the future, choose to divest certain entities, businesses, or product lines. We may have difficulty obtaining terms acceptable to us. Additionally, we may have difficulty carving out portions of or entire businesses, we may incur a loss of revenue or experience a negative impact on margins, or we may not achieve the desired strategic and financial benefits. Such potential transactions may also delay achievement of our strategic objectives, cause us to incur additional expenses, disrupt customer, partner, and employee relationships, and may expose us to unanticipated or ongoing obligations and liabilities, including because of indemnification obligations. Further, during the pendency of a divestiture, we may be subject to risks such as a decline in the business to be divested, a loss of employees, customers, or suppliers, and the risk that the transaction may not close, any of which could have a material adverse effect on the business to be divested as well as our retained business. If a divestiture is not completed for any reason, we may not be able to find another buyer on the same terms, and we may have incurred significant costs without the corresponding benefit.
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
Innovation: We might not be able to compete effectively if we strategize our solution portfolio ineffectively or if we are unable to keep up with rapid technological and product innovations, enhancements, new business models, and changing market expectations.
Our future success depends on our ability to keep pace with technological and process innovations and new business models, as well as on our ability to develop new products and services, enhance and expand our existing products and services portfolio, and integrate products and services we obtain through acquisitions. To be successful, we are required to adapt our products and our go-to-market approach to a cloud-based delivery and consumption model so as to satisfy increasing customer demand and to ensure an appropriate level of adoption, customer satisfaction, and retention.
We are subject to risks and associated consequences in the following areas, among others: inability to develop and sell new cloud products spanning various organizations on time and in line with market demands due to complexity in heterogeneous technical environments; inability to anticipate and develop technological improvements or succeed in adapting SAP products, services, processes, and business models to technological change, changing regulatory requirements, or emerging industry standards; a change in requirements of our customers and partners to strengthen the Intelligent Enterprise strategy; the possibility that our product and technology strategy might not be successful, or that our customers and partners might not adopt our technology platforms, applications, or cloud services quickly enough, or that they might consider other competing solutions in the market, or that they may leverage AI to produce their own solutions, or that our strategy might not match customers’ expectations and needs, specifically in the context of expanding the product portfolio into additional markets.
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We are integrating AI into several of our products, including our suite of enterprise applications and SAP BTP, and we expect our use of AI across our portfolio to continue to grow. As with many innovations, AI presents risks and challenges that could affect its adoption and therefore our business. AI algorithms or training methodologies may be flawed. Data sets may be overbroad, insufficient, or contain biased information. Content generated by AI systems may be offensive, illegal, or otherwise harmful. Ineffective or inadequate AI development or deployment practices by SAP or our partners could result in incidents that impair the acceptance of AI solutions or cause harm to individuals, customers, or society, or result in our products and services not working as intended. Human review of certain outputs may be required, which could introduce error or inefficiencies to the intended use of our AI-enabled offerings. As a result of these and other challenges associated with innovative technologies, our implementation of AI systems could subject us to competitive harm, regulatory action, legal liability, and brand or reputational harm.
There is significant uncertainty surrounding the applications of intellectual property and privacy laws to AI technology. Intellectual property ownership and license rights, including copyright, surrounding AI technology have not been fully addressed by courts or other laws or regulations of the jurisdictions in which we operate, and our use of AI technology or integration of AI technology into our products and services may result in disputes with respect to ownership or intellectual property, or exposure to claims of copyright or other intellectual property misappropriation. In addition, our AI technology may involve the processing of personal and other sensitive data and may be subject to laws, policies, legal obligations, and contractual requirements related to privacy, data protection, and information security. Various privacy laws extend rights to consumers (such as the right to obtain consent or delete certain personal data) and regulate automated decision making. An alleged or actual failure to meet these obligations may lead to regulatory investigations and fines or penalties; may require us to change our business practices or retrain our algorithms; or may prevent or limit our use of AI technology. It is also possible that we are held liable for intellectual property, privacy, or other legal violations of third-party AI technology that we use, and that we may not have full recourse for any damages that we suffer (for example, our use of third-party AI technology may be subject to limitations of liability or provide no liability coverage).
In addition, some AI scenarios present ethical issues or may have broad impacts on society, and there can be no assurance that our Global AI Ethics Policy or similar policies and procedures will be sufficient to address such issues. If we enable or offer AI solutions that have unintended consequences, unintended usage or customization by our customers and partners, or are controversial because of their impact on human rights, privacy, employment, or other social, economic, or political issues, we may experience reputational harm, adversely affecting our business and consolidated financial statements.
Any of these events could have a material adverse effect on our reputation, business, competitive or financial position, profit, and cash flows.
ITEM 4. INFORMATION ABOUT SAP
Our legal corporate name is SAP SE. SAP SE is translated in English to SAP European Company (Societas Europaea, or “SE”). SAP SE is organized in the Federal Republic of Germany under German and European law, see “Item 10. Additional Information.” Where the context requires in the discussion below, SAP SE also refers to our predecessor or previous legal forms and names, as the case may be, i.e. Systemanalyse und Programmentwicklung GbR (1972-1976), SAP Systeme, Anwendungen, Produkte in der Datenverarbeitung GmbH (1976-1988), “SAP Aktiengesellschaft Systeme, Anwendungen, Produkte in der Datenverarbeitung” (1988 – 2005) and “SAP AG” (2005 – 2014). Our principal executive offices, headquarters and registered office are located at Dietmar-Hopp-Allee 16, 69190 Walldorf, Germany. Our telephone number is +49-6227-7-47474.
For (i) a description of our principal capital expenditures and divestitures and the amount invested (including interests in other companies) since January 1, 2025 until the date of this report and (ii) information concerning our principal capital expenditures and divestitures currently in progress, including the distribution of these investments geographically and the method of financing, see “Item 4. Information About SAP – Description of Property.”
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The following table sets forth our most significant subsidiaries based on total revenues of SAP group in 2025. All of these subsidiaries are wholly owned or controlled by SAP SE.
Name of Subsidiary | | Country of |
Germany |
| |
SAP Deutschland SE & Co. KG, Walldorf | Germany | |
Rest of EMEA |
| |
Concur Holdings (Netherlands) B.V., ‘s-Hertogenbosch | The Netherlands | |
SAP (Schweiz) AG, Biel | Switzerland | |
SAP (UK) Limited, Feltham | United Kingdom | |
SAP Belgium – Systems, Applications and Products S.A., Brussels | Belgium | |
SAP España – Sistemas, Aplicaciones y Productos en la Informática, S.A., Madrid | Spain | |
SAP France, Levallois Perret | France | |
SAP Italia Sistemi Applicazioni Prodotti in Data Processing S.p.A., Vimercate | Italy | |
SAP Nederland B.V., ‘s-Hertogenbosch | The Netherlands | |
SAP Österreich GmbH, Vienna | Austria | |
United States |
| |
Ariba, Inc., Palo Alto | USA | |
Concur Technologies, Inc., Bellevue | USA | |
SAP America, Inc., Newtown Square | USA | |
SAP Industries, Inc., Newtown Square | USA | |
SAP National Security Services, Inc., Newtown Square | USA | |
Rest of Americas |
| |
SAP Brasil Ltda., São Paulo | Brazil | |
SAP Canada, Inc., Toronto | Canada | |
SAP México S.A. de C.V., Mexico City | Mexico | |
Japan |
| |
SAP Japan Co., Ltd., Tokyo | Japan | |
Rest of APJ |
| |
SAP Australia Pty Ltd., Sydney | Australia | |
SAP China Co., Ltd., Shanghai | China | |
SAP India Private Limited, Bengaluru | India |
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Strategy and Business Model
Overview of SAP
Founded in 1972, SAP is a global company headquartered in Walldorf, Germany. Our legal corporate name is SAP SE. For over 50 years, organizations have trusted SAP to bring out their best by uniting business-critical operations spanning finance, procurement, HR, supply chain, customer experience, and others. Today, the Company’s integrated applications aim to connect all parts of a business into an intelligent suite on a fully digital platform in the cloud, thereby replacing the process-driven legacy platform. The SAP Group has a global presence and employed more than 110,000 people as at December 31, 2025.
Our ordinary shares are listed on the Frankfurt Stock Exchange. American Depositary Receipts (ADRs) representing SAP SE ordinary shares are listed on the New York Stock Exchange (NYSE). SAP is a member of Germany’s DAX and TecDAX. Throughout 2025, SAP was among the most valuable companies on the DAX, and in Europe, based on market capitalization.
Our Purpose
At SAP, we remain steadfast in our purpose to “help the world run better and improve people’s lives. Together with our customers, we not only rise to meet today’s challenges, but we are also shaping the future by empowering each other to continuously improve and deliver better outcomes. We believe that progress depends on people and systems working together, and that technology is essential in addressing the most profound economic, environmental, and social challenges. Software and analytics help predict and prevent disasters, make cities smarter, and foster equity in the workplace. By leveraging innovative tools and business models, we help everyone in the SAP ecosystem make business decisions that have a lasting impact.
We recognize our role in minimizing carbon footprints, promoting human rights, and turning sustainability into a competitive advantage by combining applications, data, and AI into a single intelligent system. We are committed to providing AI solutions that are integral to our customers’ most critical business processes, and aim to ensure that these solutions are relevant, reliable, and responsible. Our solutions are designed to help anticipate risks and avert crises, enable smarter cities, and foster a world built on inclusion and equity. Together, we aim to bring out the best in the world around us.
Our Vision
Our vision of bringing out the best in every business reflects our commitment to transform organizations globally. Our commitment to this vision is based on three pillars:
Transform Your Business at Scale with AI
To stay competitive in a rapidly changing political, socioeconomic, and technological landscape, businesses need to continuously transform at scale. We help our customers drive end-to-end business transformation powered by AI. By creating one harmonized data layer and embedding AI-driven intelligence into core processes, our SAP Business Suite unlocks new pathways to organizational innovation and excellence to enhance agility and drive scalable growth.
Achieve More Across the Value Chain
We help companies leverage collective intelligence to become efficient, resilient, and agile across their entire value chain. By embedding AI and connecting end-to-end business processes—from finance to supply chains, and human resources to customer relations—we fuel efficient growth throughout their business networks. Our solutions aim to go beyond internal systems: they link businesses across enterprises and, by digitalizing transactions, foster transparent, resilient, and sustainable value chains.
Innovate Sustainably and with Confidence
Companies are looking to innovate without compromising ethical and security standards while pursuing sustainable business success. We help our customers innovate by embedding security and simple, transparent compliance controls into solutions, enabling them to decide where their data resides and who can access it. By connecting applications, data, and AI, we help companies drive sustainable action and measurable impact.
At SAP, our journey is one of continuous innovation and transformation. We are committed to delivering solutions that integrate seamlessly, evolve alongside our customers, and are ready to grow with their ambitions.
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Our Business Model7
Our business model, through which we implement our vision and strategy, can be summarized as follows:
We create value by first identifying the business needs of our customers and then developing and delivering a portfolio of cloud solutions, services, and support that address these needs. We strive to continuously improve our solutions, identify further business needs, and deliver enhanced value to our customers.
We derive revenue from fees charged to our customers for subscriptions to use our cloud solutions. Software licenses, on-premise support, consulting, development, training, and other services also contribute significant revenue.
For an overview of our product portfolio, see the Our Product Strategy section.
Subsidiaries, Acquisitions, and Joint Ventures
Subsidiaries
SAP SE is the ultimate parent company of the SAP Group. As at December 31, 2025, the SAP Group comprised 216 companies.
For a list of our subsidiaries, associates, and other equity investments, see the Notes to the Consolidated Financial Statements, Note (G.9).
Material Acquisitions
We continue to focus on organic investments in technology and innovations, which are intended to ensure that our product portfolio grows sustainably. Additionally, we may make targeted acquisitions to complement our solution offerings and improve coverage in key strategic markets.
On August 1, 2025, SAP announced its intent to acquire 100% of SmartRecruiters, a leading talent acquisition (TA) software provider. The transaction closed on September 11, 2025, following satisfaction of regulatory and other approvals.
For more information about SmartRecruiters, see the Notes to the Consolidated Financial Statements, Note (D.1).
Sapphire Ventures
In addition to our investments in organic growth and acquisitions, SAP also supports entrepreneurs who aspire to build industry-leading businesses through venture capital funds managed by Sapphire Ventures. Sapphire Ventures manages more than US$11 billion (over €9 billion) and has invested in more than 200 companies. It pursues opportunities in which it can help fuel enterprise growth by adding expertise, relationships, geographic reach, and capital. It places a particular focus on companies and venture funds in Europe, Israel, the United Kingdom, and the United States. Sapphire Ventures has committed to investing more than US$1 billion in the next generation of AI - powered enterprise technology startups.
Our Product Strategy8
With the IT landscape continuing to transform at pace, SAP is seeing a clear shift in customer preferences toward the cloud—and toward solutions that are flexible, agile, scalable, and cost-effective. SAP understands the importance of helping customers embrace digital technologies to thrive in today’s dynamic business environment, and has therefore adopted a forward-thinking strategy for sustainable growth and innovation. This strategy also includes sovereign cloud offerings that enable governments and regulated industries to adopt cloud and AI with full control across data, operations, technology, and law, allowing them to innovate on their own terms and under their own governance. We recognize that every organization’s experience with the cloud can be unique and challenging. Yet many customers are already benefiting in many ways: for example, they can allocate personnel who used to manage internal IT teams to other tasks, and ensure online access to systems and data from any location. This shift to the cloud creates new customer requirements and hence new market opportunities that SAP can tap into.
7 Description of business model, inputs and outputs: ESRS 2 SBM-1 42 (a), (b).
8 Amendments to strategy and business model: ESRS 2 SBM-2 45 c (i).
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Generative and agentic AI are reshaping how businesses operate and how end-users engage with software. Across industries, AI is becoming the core driver of transformation, redefining business processes and unlocking untapped potential for innovation and growth. To address this latest technology shift, an integrated foundation that seamlessly brings together applications, data, and AI is essential: SAP’s flywheel. The flywheel captures momentum from continuous rotations across the three layers. Deeply integrated Business AI enhances our SAP Cloud ERP applications, which in turn generate richer, more accurate data. With our SAP Business Data Cloud solution, valuable business data from every part of the business feeds into a semantically rich data layer. | |
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SAP Business Suite offers a comprehensive set of integrated solutions, in which applications, data, and AI work as one. It is the destination for all our customers.
The Cloud ERP Suite metric is the subset of SAP Business Suite covering most of our strategic cloud solutions. For more information about Cloud ERP Suite, see the Performance Management System section. The remaining offerings are part of SAP’s extension suite, which supplements and extends the functional coverage of SAP’s solutions for the cloud.
To strengthen our position as a leading enterprise software company, we have adopted an AI-First, Suite-First strategy, which aims to ensure that our initiatives focus on our key differentiators.
AI-First means that we are not just adding AI capabilities to existing business processes, but adapting our approach to product development. We aim to embed Business AI in every application and business process to boost customer productivity, profitability, and innovation, based on the highest standards of responsible AI as outlined in our Global AI Ethics Policy. Central to this approach are Joule (our AI user experience layer), Joule Agents (AI systems that autonomously plan and execute workflows, connect departments, and optimize business processes while collaborating with users and providing insights), and SAP Business Data Cloud (which serves as the data platform across the SAP cloud portfolio, fueling AI capabilities with semantically rich data products).
At the same time, new agentic AI capabilities are reshaping the enterprise technology market, and business process execution is shifting from individual applications to an agentic AI layer that runs all critical processes and becomes the new user experience. To lead this next phase of our transformation, we will be focusing even more strongly on AI in 2026. This includes deploying Joule as the new AI user experience for every user; embedding agentic AI into end-to-end business processes to deliver value through AI assistants; codeveloping with customers to create next-generation AI-powered industry applications; establishing SAP Business Data Cloud as the foundational data layer for AI; and scaling adoption through our RISE with SAP and SAP GROW offerings.
For our cloud products, Suite-First describes our objective of delivering a consistent, or suite-like, experience across our portfolio. SAP Business Technology Platform (SAP BTP) serves as the foundation for this strategy, facilitating development, extensions, and integrations while maintaining a clean core, ensuring that our solutions remain adaptable and forward-looking.
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SAP strives to help customers grow their businesses profitably, while at the same time minimizing the risks. To this end, SAP has two journeys, RISE with SAP and SAP GROW, which cater to different customer objectives and requirements. RISE with SAP is targeted at our installed base customers and helps them on their journey from legacy ERP systems to SAP Business Suite. SAP GROW is targeted at new SAP Business Suite customers across a broad market landscape, ranging primarily from those with revenues below €50 million to those with revenues in excess of €1 billion. The offering aims to help them grow their business and simplify work processes. Both journeys provide AI-enabled migration tools that ease our customers transition to SAP Business Suite with less effort.
To guide customers as they migrate to SAP Business Suite, we introduced an evolution of our SAP Services and Support portfolio. The modernized, tiered services and support engagement model will be brought to market in early 2026 and will offer three success plan options: the Foundational Success Plan, the Advanced Success Plan, and the Max Success Plan.
Products9
The pillars of SAP’s product strategy, and our development and innovations, are presented below.
SAP Business AI
SAP Business AI capabilities are available across SAP Business Suite and SAP BTP. SAP offers a wide range of embedded AI features built into core business processes across finance, spend, supply chain, procurement, human capital management, customer relationship management, and customer experience, and in IT and industries.
Joule and Joule Agents fundamentally transform how users interact with SAP’s enterprise applications. Joule serves as an intuitive AI experience layer, navigating applications, executing transactions, and orchestrating digital workforces of prebuilt and custom agents across both SAP and non-SAP systems. Joule Agents are able to take over complex tasks that span the enterprise. The SAP Knowledge Graph solution connects and contextualizes data from across the enterprise and enables Joule Agents to reason and act reliably across end-to-end processes. In 2025, we released 30 Joule Agents.
Our AI Foundation solution on SAP BTP ensures that AI models, trusted data, security, and extensibility are deeply embedded—empowering organizations to streamline processes, accelerate cloud transformation, and adopt responsible AI in a secure, scalable manner.
SAP Business Data Cloud
SAP Business Data Cloud is a fully managed software as a service (SaaS) solution that unifies and governs all SAP data and seamlessly connects with third-party data. It aims to enable customers to transform outcomes with intelligent applications, harmonize mission-critical data, and ensure that trusted data can be used as a foundation for successful agentic AI. The solution can help organizations simplify their data landscape with fully managed data and AI capabilities. It can also help organizations build their business data fabric and a connected, open ecosystem that preserves mission-critical business context across all data.
The key capabilities of SAP Business Data Cloud include: SAP Data Products, which are sets of fully managed and certified data and metadata from SAP applications; the SAP Analytics Cloud solution, which unites analytics and enterprise planning in a single product; the SAP Business Warehouse application, which brings mission-critical, historical data to the cloud and the entire data landscape; the SAP Datasphere solution, which gives customers a semantic layer to discover, share, and model the same trusted data across their business data fabric; SAP Business Data Cloud Intelligent Applications, which address specific business problems and can automate, adapt, and learn in real time; the SAP Databricks capability in SAP Business Data Cloud, which unifies data from SAP line-of-business applications, and structured and unstructured data, to accelerate advanced analytics and machine learning workloads; and the SAP Business Data Cloud Connect solution, which provides bidirectional, zero-copy data sharing in SAP Business Data Cloud with third-party data platforms such as Databricks, Google, and Snowflake. In 2025, we released hundreds of prebuilt, SAP-managed data products for SAP Business Data Cloud.
9 Description of significant groups of products and/or services offered: ESRS 2 SBM-1 40 a (i).
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SAP Business Technology Platform
SAP Business Technology Platform (SAP BTP) is a unified platform designed to extend existing systems, integrate applications and business processes, and build AI-supported applications across the enterprise. As the foundation of SAP Business Suite, SAP BTP unlocks the full potential of our customers’ and partners’ applications, data, and AI.
One of SAP BTP’s key capabilities is SAP Build, which provides an intuitive, open, and unified application development and process automation solution environment for IT and citizen developers. SAP Build features the SAP Joule for Developers add-on and the Joule Studio capability, which allow users to incorporate AI into every aspect of SAP Build and Advanced Business Application Programming (ABAP) development, and to build custom Joule agents and skills. Also part of SAP BTP are SAP Integration Suite—a single scalable, AI-assisted integration platform as a service (iPaaS) to connect and automate business processes across SAP and third-party landscapes—and SAP BTP core capabilities for centralizing application lifecycle, interoperability, security, and administration.
Cloud ERP
SAP Cloud ERP provides software capabilities for finance, risk management, project management, procurement, manufacturing, supply chain management, asset management, R&D, and more. These include capabilities such as the SAP HANA in-memory database, data management, AI, and application lifecycle management—and SAP Cloud ERP solutions, which ease our customers’ transformation to the cloud. These solutions help customers adopt new business models by enabling them to leverage AI, machine learning, and other intelligent technologies for enhanced data analytics and automation.
Financial Management
SAP’s financial management solutions enable organizations to streamline financial operations, ensure compliance, and drive strategic decision-making. SAP delivers a comprehensive, integrated suite across the full spectrum of financial operations—from planning and analysis to the financial close, quote-to-cash, treasury and working capital management, tax and trade, and governance, risk, and compliance—empowering CFOs to elevate their finance organizations from transactional processors to strategic business partners. The SAP Taulia portfolio extends the working capital optimization capabilities in SAP Business Suite by helping businesses and their suppliers release funds trapped in the supply chain, thereby optimizing cash flow and unlocking growth opportunities. Leveraging embedded AI, trusted data, and streamlined processes, these solutions equip finance teams to operate more efficiently, anticipate changes, and lead with confidence.
Spend Management
SAP’s spend management solutions enable procurement teams to unlock real potential from AI and make better decisions with seamless and accessible data. Covering direct and indirect spend, travel and expenses, and external workforce management, these solutions give customers a unified view of their spend to reduce costs, mitigate risks, improve collaboration, and align spend decisions with business strategy. SAP Ariba applications provide a modern, AI-native suite of source-to-pay solutions designed to translate deep insights into seamless processes, ensuring productivity, accuracy, and an optimized employee experience. The SAP Concur portfolio contains solutions for integrated travel, expense, and invoice management. And SAP Fieldglass solutions help businesses find, engage, and manage their global external workforce.
Supply Chain Management
SAP’s portfolio of supply chain management solutions helps companies around the globe and across industries orchestrate their teams, processes, and systems—both internally and with trading partners—to build a stronger supply chain. By providing a comprehensive suite of AI-infused applications that integrate with ERP and adjacent line-of-business solutions, and which digitally connect with trading partner systems, SAP helps break down silos for more efficient, compliant, and responsive supply chains. And, by equipping companies with advanced analytics, operational insights, predictive signals, and recommended actions, it also helps them adapt to changing circumstances and exceed their expectations.
Human Capital Management
SAP SuccessFactors solutions are designed to empower organizations to create an agile, future-ready workforce in a rapidly changing workplace, and help their employees work smarter and more efficiently. The SAP SuccessFactors portfolio includes an AI-enabled suite of cloud solutions that spans core HR, time tracking, payroll, talent acquisition and management, analytics, and employee experience management.
In September, SAP completed the acquisition of SmartRecruiters, a leading provider of enterprise-grade talent acquisition software. The SmartRecruiters platform will be integrated with the SAP SuccessFactors Human Capital Management (HCM) suite. This addition to the SAP SuccessFactors portfolio will help organizations manage the entire talent lifecycle, from sourcing to onboarding, with enhanced AI-enabled recruiting capabilities.
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Customer Experience
SAP Customer Experience (SAP CX) is a comprehensive portfolio of marketing, commerce, sales, and service solutions that are natively integrated with SAP ERP and powered by SAP Business AI to deliver insights, operational efficiency, and scalable customer engagement from a single, unified platform. This integration can provide organizations with a governed, real-time view of their business to enrich customer interactions. Joule with embedded SAP CX AI agents can help marketing, sales, and service teams work faster and smarter by enhancing decision-making and proactively assisting and automating workflows.
Business Transformation Management
SAP’s business transformation management solutions help customers realize holistic, data-driven business transformation across several pillars: business processes with SAP Signavio, applications with SAP LeanIX, and people with WalkMe. The comprehensive approach to transformation that these solutions offer can unlock quantifiable business value for organizations, such as deep business insights, optimized IT landscapes, and help with getting their people on board with change.
SAP Signavio solutions, powered by AI, help organizations manage, analyze, and optimize their business processes to achieve the insights and agility they need for successful business transformations. By benchmarking current process landscapes against best practices, and acting on change recommendations, customers can define a target state, adapt their processes accordingly, and assess whether the outcomes they achieve align with their strategic goals.
With SAP LeanIX, customers can manage and transform their IT landscape. SAP LeanIX solutions enable organizations to create transparency over their IT environment, assess interdependencies and risks, and plan modernization initiatives so that they are well equipped to move toward their target IT landscape—supported by proven reference materials, best practices, and seamless integration with leading SAP and non-SAP solutions.
WalkMe offerings help organizations navigate technology change and maximize the return on their software investments by easing user onboarding in cloud solutions. WalkMe’s digital adoption platform delivers guidance, automation, and contextual AI assistance directly in the flow of work, enabling employees to complete workflows across applications, from SAP and beyond. WalkMe’s digital learning solution helps companies reskill their workforce by embedding training directly into the tools employees use every day.
Sustainability Management
SAP helps customers transform sustainability data into real business opportunities and operational efficiencies. The SAP Sustainability portfolio delivers ERP-centric, cloud-based, AI-enabled sustainability solutions for companies of all sizes and from all industries, and supports them by embedding sustainability into every aspect of their daily business operations. The portfolio includes the following offerings: SAP Sustainability Control Tower, SAP Sustainability Footprint Management, SAP Sustainability Data Exchange, and SAP Green Ledger.
Partners and the Ecosystem
The global SAP partner ecosystem plays a key role in delivering and extending our cloud and solution offerings. Our partners support the entire customer lifecycle—from selling and implementing to running and extending our solutions on SAP BTP—and enable customers to integrate, extend, and innovate across SAP Business Suite.
Services and Support
We continue to evolve our cloud-focused services and support portfolio to focus on customer adoption and consumption.
The foundation of the SAP Services and Support portfolio is SAP Enterprise Support, which provides tools and services, curated content, and mission-critical support. SAP Enterprise Support, cloud editions are included with cloud solution subscriptions. Customers who require more guidance from SAP can opt for incremental service plans, such as SAP Preferred Success and SAP Cloud Application Services, and professional services to address project-specific objectives, timelines, and plans.
To help customers who are planning to make an enterprise-wide transformational change, SAP offers SAP MaxAttention and SAP ActiveAttention services for tailored, long-term strategic engagement. Learning and user enablement is available throughout a customer’s journey and ranges from role-based digital content to expert-led live sessions, hands-on practical training, custom learning content, and certification.
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Partnerships
SAP announced various partnerships in 2025.
| - | On May 20, SAP and Accenture announced an expansion of their partnership to help companies enable connected intelligence across the enterprise to drive speed and agility in the AI era through the new ADVANCE offering. |
| - | Also on May 20, SAP and Perplexity announced a partnership to extend SAP’s generative AI and search capabilities by bringing together unstructured and structured data. In addition, SAP and Palantir announced a partnership to facilitate joint customers’ cloud migration journeys and modernization programs by connecting the unified, context-rich data environment of SAP Business Data Cloud with Palantir’s Ontology and Artificial Intelligence Platform. |
| - | On May 27, SAP and Alibaba Group announced an extension of their strategic partnership to accelerate cloud transformation. |
| - | On September 19, SAP and ADP, a global leader in HR and payroll solutions, announced that they would partner to enable shared clients to run ADP Global Payroll in the cloud. |
| - | On September 24, SAP and OpenAI announced the launch of OpenAI for Germany, a partnership to bring SAP’s enterprise applications expertise and OpenAI’s leading AI technology to Germany’s public sector. In addition, SAP and Amazon Web Services (AWS), an Amazon.com company, announced plans to make SAP Sovereign Cloud capabilities available on the AWS European Sovereign Cloud, a new independent cloud for Europe. |
| - | Also on September 24, SAP and Alibaba announced plans to advance their strategic partnership with the phased launch of four SAP cloud solutions (SAP Cloud ERP, SAP Cloud ERP Private, SAP BTP, and SAP Integrated Business Planning) on Alibaba Cloud for Chinese enterprises in China. |
| - | On October 6, SAP and Google Cloud announced that they would expand their long-standing data and analytics partnership with the launch of SAP Business Data Cloud Connect for Google BigQuery—a new capability that aims to simplify access to mission-critical SAP data products from SAP Business Data Cloud through bidirectional, zero-copy data sharing. At the same time, SAP announced SAP Business Data Cloud Connect for Databricks. |
| - | On November 4, SAP and Snowflake, an AI data cloud company, announced the SAP Snowflake solution extension for SAP Business Data Cloud to bring Snowflake’s data and AI capabilities directly to SAP customers. SAP also announced SAP Business Data Cloud Connect for Snowflake, which will make it easier for customers to harmonize and govern mission-critical data wherever it resides. |
| - | On November 18, SAP announced new and expanded collaborations with Mistral AI, Bleu, and Capgemini at the Franco-German EU Summit on Digital Sovereignty. These partnerships aim to accelerate Europe’s digital transformation through secure, scalable, AI-driven sovereign cloud solutions that protect data and intellectual property. |
| - | On November 27, SAP announced the next stage of its vision for European digital sovereignty with the launch of EU AI Cloud. SAP now offers a truly full-stack sovereign cloud offering, empowering customers to select the right level of sovereignty and deployment for their needs, whether in SAP’s own data centers, on trusted European infrastructure, or as a fully managed solution on-site. |
Our Customers
We strive to maximize the value our customers derive from their investment in SAP and from their relationship with us. We do so at every touchpoint in their experience with us over the entire engagement lifecycle. Our customer-facing teams—across solutions, sales, services, customer engagement, ecosystem, and more—work together under an operating model that aims to harmonize internal processes with the goal of delivering improved outcomes for our customers.
Feedback from our customers is crucial to our journey together. To systematically gather and act on these insights, we have a company-wide Global Experience Management (XM) Program10 in place. This program aims to achieve a consistent end-to-end experience for our customers by standardizing experience initiatives and methodologies to help identify and close any gaps. The head of Customer and Market Intelligence (CMI) in the Strategy & Operations Board area leads our global XM program, which includes the SAP Customer Loyalty Survey. The customer experience metric derived from this survey is a KPI in the short-term incentive component of Executive Board remuneration. Historically, this KPI is the Customer Net Promoter Score (NPS). Given the importance of our customers and their feedback to SAP, the customer experience KPI is one of our main non-financial KPIs and a performance measure in the short-term incentive component of Executive Board compensation.
In 2025, our Customer NPS decreased three points year over year to nine (2024: 12), which is below our target range of 12 to 16.
Starting in 2026, we will revise our customer experience framework and replace the customer net promoter score with the Cloud Customer Satisfaction (CSAT) KPI. For more information, especially for the differentiation between cloud and on-premise customers, see the Performance Management System section.
10 Description of engagement with customers: ESRS 2 SBM-2 45 (a).
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Policies, such as our Global Code of Ethics and Business Conduct for Employees, and the applicable General Terms and Conditions govern our relationships with our customers.
Our Investments in Innovation11
We are committed to scaling AI adoption across our organization to accelerate and optimize our innovation cycle. To drive competitive edge, the focus of our research and development (R&D) activities is on advancing our product portfolio. Our priorities here are to strengthen our AI foundation and seamlessly integrate our products. SAP’s strong commitment to R&D is reflected in our expenditure.
In the reporting year, our R&D expenditure increased year over year. Main driver was the higher, but disciplined, use of contingent workforce, which was partially offset by lower share-based payment expenses. While our R&D expenditure increased in 2025, our R&D ratios slightly decreased due to the stronger acceleration in revenues. Our IFRS R&D ratio, which reflects R&D expenditure as a portion of total revenue, decreased 1.0 percentage points (pp) to 18.0% (2024: 19.1%). Our non-IFRS R&D ratio likewise decreased 1.0 pp year over year to 18.0% (2024: 19.0%). At the end of 2025, our total full-time equivalent (FTE) headcount in development was 37,965 (2024: 37,590). Measured in FTEs, our R&D headcount remained at 34% of total headcount (2024: 34%).
Total R&D expenditure not only includes our own personnel costs but also the external costs of work and services from the providers and cooperation partners we work with to deliver and enhance our products. We also incur external costs for the following:
| - | Translating, localizing, and testing products |
| - | Obtaining certification for products in different markets |
| - | Patent attorney services and fees |
| - | Consulting related to our product strategy |
| - | Professional development of our R&D workforce |
Patents
Our investment in R&D has resulted in numerous patents. As at December 31, 2025, SAP held almost 13,000 (2024: more than 13,000) validated patents worldwide. Of these, more than 600 (2024: more than 700) were granted and validated in 2025.
While our intellectual property is important to our success, we believe our business as a whole is not dependent on any particular patent or combination of patents.
Competitive Intangibles
The majority of (intangible) resources that are the basis for our current and future success do not appear in the book value of equity in our Consolidated Financial Statements. This is apparent from a comparison of the market capitalization of SAP SE (based on all issued shares), which was €256.0 billion at the end of 2025 (2024: €290.3 billion), with the book value of our equity in the Consolidated Financial Statements, which was €45.1 billion (2024: €45.8 billion). This means that the market capitalization of our equity is more than five times the book value.
Seasonality
Over the years 2025, 2024, and 2023, on-premise support revenues and cloud revenues have further increased their share of total revenues. Unlike our on-premise software revenues, our on-premise support revenues and cloud revenues are less subject to seasonality. Due to the constant decrease in on-premise software revenues, which is expected to continue, the seasonality in SAP's revenues is expected to vanish in the near future. For more information about the development of our share of more predictable revenue in 2025, see “Item 5. Operating and Financial Review and Prospects – Operating Results (IFRS).” For more information about the expected development of our share of more predictable revenue, see “Item 5. Operating and Financial Review and Prospects – Expected Developments.”
11 Description of business model, inputs and outputs: ESRS 2 SBM-1 42 (a), (b).
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Security, Cloud Compliance, and Data Protection and Privacy
Our Approach and Policies
We strive to protect the rights of data subjects, safeguard information and systems, and comply with applicable local requirements across our products and services. Our integrated approach to data protection, privacy, and security is embedded in SAP’s broader business strategy and supports our objective of strengthening SAP’s reputation as a sustainable, trustworthy partner in the market. Everyone has the right to have their personal data protected.
To further enhance our commitment to security and compliance, we integrate security considerations into every stage of the software development and cloud operations lifecycle. We utilize various methodologies, guidelines, processes, and tools to address and adapt effectively to evolving cybersecurity threats.
We designed and implemented these safeguards to protect the fundamental rights of everyone whose data is processed by SAP, and of everyone who uses SAP’s products, including customers, suppliers, partners, prospects, employees, and applicants.
Management plays a central role in defining data protection, security, and regulatory-compliance requirements and in embedding them into business processes to ensure adherence to applicable laws and standards. Senior leadership delegates responsibility across management levels, establishing clear accountability, resourcing, and oversight, so that requirements are translated into operational controls.
Accordingly, each global SAP line of business (LoB) is mandated to implement these data privacy, security, and compliance requirements within its area of responsibility. LoBs align local processes with corporate policies and global standards, integrate security and privacy controls into the product and service lifecycle, perform risk and impact assessments (including Data Protection Impact Assessments where appropriate), maintain documentation and audit trails, deliver role-based training, and coordinate incident reporting and remediation with SAP’s central security, privacy, legal, and compliance teams. These measures ensure consistent implementation, regulatory cooperation, and ongoing monitoring to maintain compliance and protect stakeholders.
At the local level, operational responsibility for compliance with data privacy requirements is assigned to local CFOs, who are supported by a network of local Data Protection and Privacy Coordinators (DPPCs). Unless one has already been appointed by the Data Protection and Privacy team (DPP), each CFO must designate a local DPPC. The DPPCs are responsible for conducting audits to verify the Company’s compliance with regulations. The CFO is also responsible for facilitating these audits and implementing any measures that are necessary to address compliance gaps.
The Global Security Policy is a controlled document owned by SAP’s Chief Security Officer and SAP’s Chief Security Compliance & Risk Officer, with reviews, approvals, and publishing managed by the SAP Global Policy Coordination Office in accordance with SAP’s governance and policy‑management procedures. The policy is published in SAP’s central policy repository and communicated to relevant stakeholders through established governance channels and mandatory training, ensuring that those affected and those responsible for implementation have access to the policy and oversight from the leadership.
Our Actions and Targets
Addressing Material Impacts
SAP applies a layered approach to prevent, mitigate, and remediate negative impacts and risks. Preventive measures are embedded across the product lifecycle and include secure-by-design practices, role‑based training and guidance on information security and data privacy, proactive publication of security information through internal and external channels, and targeted consultation and support for customers and partners.
For mitigation and remediation, SAP operates a centralized incident‑management tool and follows defined response procedures to ensure timely detection, containment, investigation, and resolution of incidents in line with its policy. Post-incident root-cause analysis, remediation tracking, and stakeholder communication support accountability and continuous improvement.
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The table below sets out the key actions that SAP continuously carries out to prevent, mitigate, or remediate negative impacts or risks.
Action | | Description | | Objective | | Metrics, Targets, and |
|---|---|---|---|---|---|---|
SAP’s cyberthreat intelligence initiatives and operations1 | An advanced initiative designed to proactively manage cybersecurity threats. It integrates various cybersecurity services, incorporates event, incident, threat, and vulnerability management, and ensures 24/7 security monitoring. Security incidents are handled through a structured incident management process aligned with ISO/IEC 27035 principles. Managing customer-reported incidents and data-subject requests entails collaboration with customers and regulatory authorities. Customers can submit security incidents through Customer Support, following which SAP engages with the data subjects or relevant regulatory bodies. SAP provides functionality for customers to correct or remove personal data from cloud services or to restrict the processing of that data in alignment with data protection law. If such functionality is not available, SAP acts on the customer’s instructions and on legal requirements. | Promptly identify, assess, and address potential security threats and disruptions so as to minimize adverse impacts on business operations | Metric: percentage of secure software development and operations lifecycle (SDOL) vulnerabilities mitigated within SLAs Metric: mean time to detect, respond, contain, and remediate incidents Due to the confidential nature of these metrics, the targets, KPIs, and performance against those targets cannot be disclosed. | |||
Compliance with industry standards and regulations1 | To ensure effective implementation of the SAP Cybersecurity Framework, we: - Provide our cloud and IT units with operational controls that are monitored and tested for design and operational effectiveness - Have established an independent internal audit function that reports the audit planning and audit results to the SAP Executive Board on a regular basis - Engage external internationally accredited auditors to regularly assess the design and operational effectiveness of the Framework - Offer service organization control (SOC) reports such as SOC 1 Type II/ISAE 3402 and SOC 2 Type II/ISAE 3000 for our cloud services, issued by external internationally accredited auditors - Publish certificates attesting to our compliance with international standards such as ISO 42001, ISO 9001, ISO 27001, ISO 27017, ISO 27018, ISO 22301, and BS 10012 - Offer further industry-specific and regional compliance attestations, certifications, and reports on SAP Trust Center | Adhere to industry and international standards on information security and data protection as part of a proactive approach to managing risk and maintaining operational integrity for the benefit of everyone who uses our systems | Metric: percentage of required certifications and SOC reports successfully renewed on schedule Target: 100% on-time issuance and renewal of all required certificates and SOC reports to be delivered on an annual basis. KPI: Due to their confidential nature, KPIs and performance against targets cannot be disclosed. Further details can be found on SAP Trust Center. |
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Action | | Description | | Objective | | Metrics, Targets, and |
|---|---|---|---|---|---|---|
Data Protection Management System (DPMS)2 | Framework that brings together activities, tools, and methodologies to help the business achieve specific data protection and privacy goals and compliance with applicable data protection and privacy requirements. We continuously enhance this framework to increase our data protection compliance level based on the annual recertification of DPMS by the British Standards Institute (BSI). SAP is audited by BSI annually and has been awarded certifications according to BS 10012 since 2011. The most recent certification is valid until the end of 2025. The certificate can be found on SAP Trust Center. | Provide guidance to all employees with respect to meeting data protection requirements across SAP, and ensure a robust approach to data privacy compliance | Metric: notifiable data protection incidents Target: certificate for DPMS maintained on an annual basis Details can be found on SAP Trust Center. | |||
SAP Third-Party Risk Management Process3 | Process that follows international regulations and SAP's own quality standards, both of which require the careful selection and monitoring of subprocessors who handle personal data on behalf of SAP and SAP’s customers | Ensure that all subprocessors meet the necessary data protection and security requirements for the processing of personal data, thereby safeguarding the interests of SAP, its customers, partners, employees, and end-users | Metric: notifiable data protection incidents Target: supplier compliance maintained, risks mitigated, transparency on data processing maintained, and incident response effectively managed Details can be found on SAP Trust Center. | |||
Phishing awareness campaign | SAP holds a phishing awareness campaign at least three times a year that targets all SAP employees. The campaign simulates phishing attacks, using different tactics each time, and provides targeted training to employees identified as being more susceptible to such attacks. | Minimize the risk of security breaches and data compromises by training employees to recognize and report phishing attempts effectively. This approach supports the objective of the SAP Global Security Policy Framework of protecting all SAP assets from internal and external threats, whether deliberate or accidental. | Metric: percentage of employees who clicked on simulated phishing emails during phishing campaigns (click-through rate) Due to the confidential nature of these KPIs, targets and performance against those targets cannot be disclosed. |
1 Action does not include acquired companies Taulia and SmartRecruiters.
2 Action does not include Taulia, Emarsys, WalkMe, SmartRecruiters, or Volume Integration.
3 Action does not include SmartRecruiters and Volume Integration.
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Training
Global data protection and privacy training is mandatory for SAP employees and is conducted every two years. New hires are required to complete the training when they join the Company. The training is validated as part of the DPMS audit carried out by BSI.
Security compliance training comprises five different sets of online courses that are delivered annually (unless otherwise indicated), with extra sessions for new hires and employees who are changing roles.
All training courses are delivered online and tracked using our online training system.
Practicing Secure | Supporting Secure | Executive Management | Executive Support |
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Global Data Protection | Information Security | Software | Software | Security and Compliance | Security and |
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and Privacy Training3 | Fundamentals4,5 | Development3 | Development3 | Training4 | Compliance Training |
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| 2025 | | 2024 | | 2025 | | 2024 | | 2025 | | 2024 | | 2025 | | 2024 | 2025 | | 2024 | | 2025 | | 2024 |
| ||
Developers and | Developers and |
| |||||||||||||||||||||||
| | | | developer-adjacent | | developer-adjacent | | ||||||||||||||||||
Target group | | All employees | All employees | roles | roles | Executive management | Executive support roles | ||||||||||||||||||
Total |
| 106,419 |
| 108,597 |
| 112,234 |
| 106,420 |
| 32,923 |
| 20,993 |
| 7,983 |
| 6,812 |
| 664 |
| 612 |
|
| 688 | ||
Total headcount receiving training |
| 67,195 |
| 105,672 |
| 84,192 |
| 74,269 |
| 31,485 |
| 20,294 |
| 7,249 |
| 6,209 |
| 577 |
| 532 |
|
| 639 | ||
Training launch date1 |
| October 2025 |
| October 2023 |
| October 2025 |
| October 2024 |
| June 2025 |
| February 2024 |
| June 2025 |
| February 2024 |
| September 2025 |
| July 2024 |
| Not delivered |
| July 2024 | |
Training completion date1 |
| January 2026 |
| February 2024 |
| January 2026 |
| January 2025 |
| December 2025 |
| June 2024 |
| December 2025 |
| June 2024 |
| December 2025 |
| October 2024 |
| in 2025 |
| October 2024 | |
Target completion rate |
| 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | 95 | % | ||
Completion rate2 |
| 63.14 | % | 97.31 | % | 75.01 | % | 69.79 | % | 95.63 | % | 96.67 | % | 90.81 | % | 91.15 | % | 86.90 | % | 86.93 | % | 92.88 | % | ||
1 Training launch and completion dates may differ for new hires and acquired companies which affects the reported completion rates.
2 Completion rates include the completion rates for new hires and acquired companies. Training launch and completion dates differ for new hires and acquired companies which impacts the reported completion rates. For trainings that span calendar years, completion rates are presented as at December 31.
3 Training was not extended to Taulia, WalkMe, SmartRecruiters, or Volume Integration.
4 Training was not extended to Taulia, SmartRecruiters, or Volume Integration.
5 Training was extended also to non-HC relevant employees.
While affected stakeholders were not directly involved in setting targets, their interests were addressed through SAP's adherence to international standards and certifications, thereby ensuring that stakeholder interests are reflected in our governance, risk management, and reporting frameworks.
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Metrics on Material Topics
The policies and initiatives described above are designed to prevent and minimize negative impacts, enhance data protection, and mitigate security and compliance risks across the organization. Their effectiveness is demonstrated through the metrics outlined in the preceding section:
| - | Percentage of secure software development and operations lifecycle (SDOL) vulnerabilities mitigated within SLAs |
| - | Mean time to detect, respond, contain, and remediate incidents |
| - | Percentage of required certifications and SOC reports successfully renewed on schedule |
| - | Percentage of employees who clicked on simulated phishing emails during phishing campaigns (click-through rate) |
| - | Notifiable data protection incidents |
These metrics serve to confirm adherence to security policies, regulatory requirements, and cloud compliance standards, and reflect the maturity of SAP’s internal control framework.
In 2025, there were a total of eight notifiable data protection incidents that SAP reported to the relevant supervisory authorities as required by the applicable data protection law for data that SAP processes for its own purposes (2024: 10 notifiable data protection incidents).
Five of these notifiable data protection incidents were notified to SAP’s applicable lead supervisory authority in Germany (Der Landesbeauftragte für Datenschutz und Informationsfreiheit Baden-Württemberg (LfDI)); one incident was voluntarily notified to the supervisory authority in the United Kingdom (Information Commissioner’s Office (ICO)); one incident was notified to the supervisory authority in Hungary (National Authority for Data Protection and Freedom of Information (NAIH)); and one incident was notified to the supervisory authority in Japan (Personal Information Protection Commission (PPC)).
For the notifiable data protection incidents in the European Union (EU), the notification decision was based on the risk for the affected individuals as outlined in Article 33 (1) of the EU’s General Data Protection Regulation (GDPR), considering the relevant recitals of the GDPR and accompanying guidelines of the European Data Protection Board.
For the notifiable data protection incident in the United Kingdom (UK), the notification decision was based on the provisions of the UK General Data Protection Regulation (UK GDPR) and accompanying guidelines of the ICO.
For the notifiable data protection incident in Japan, the notification decision was based on the provisions of Japan’s Act on the Protection of Personal Information and accompanying enforcement rules.
Human Capital Resources
People Agenda
Established in 2024, the People Agenda is a holistic integrated people system in which people, organizational, and technological development are interconnected. We have defined three key strategic pillars built on a strong foundation that together make up our People Agenda:
Our growth culture guides how we work internally and how we address market needs and customer relationships. It increases our capacity for change, drives efficiency, and ensures accountability, helping us deliver high-performance results for our customers and markets. To support this evolution, we are implementing an execution architecture that enables scale, speed, and adaptability. We have created leadership transformation journeys to accelerate our strategy execution and SAP’s transformation agenda. We have combined the How in the form of our growth culture (four growth behaviors and three leadership promises) with the What. We have also established a network of trained change agents that span all regions and functions. Our regular Growth Summits and growth culture activation efforts reach into the business to accelerate transformation and execution. To sustain a high-performance culture, SAP has introduced a new approach to managing performance to ensure we execute in line with our strategy. That way, we endeavor to strengthen the engagement and commitment of everyone—employees, partners, customers, and shareholders. In addition, we focus on skill-infused strategic workforce management to make the right “buy, build, borrow, or break” decisions. Strategic workforce management ensures we have the right talent in the right place and with the right volume and mix of skills. It ensures the right workforce composition to execute on our strategy and to define the hiring, reskilling, and skills access strategy through third parties and through the constant adaptation of roles which are necessary to drive the right business outcome. This includes a continuous process of transforming our workforce through reskilling and shifting our resources to areas with high demand, for example, data science and business AI. For more information about the impact of the transformation, see the Notes to the Consolidated Financial Statements, Note (B.2) and the Operating Profit and Operating Margin section.
Our skills-led people ecosystem fuels growth, innovation, and opportunity—both for our people and our business. This transformation is foundational to our future and reflects a paradigm shift in how we approach hiring, learning, development, and career pathing. We have already made significant progress by building the foundation to ensure that every employee has an up-to-date skills profile that accurately reflects the work they do. This includes streamlining our skills taxonomy, aligning skills with market standards, and modernizing role profiles. In 2026, employees will be assigned to updated role profiles and, by means of the growth portfolio, we can leverage the skills taxonomy to infuse skills into every People & Culture (P&C) practice and enhance every stage of the employee experience. Our action plan includes several pilot use cases that infuse skills across the employee lifecycle, with the first use case—AI-driven, skills-based learning—launching as one of the first benefits for employees.
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We invest in our people by helping employees stay relevant and build future-critical skills. We are introducing a connected, scalable system that brings together learning, talent and leadership development, assessment, succession, and performance. This holistic approach supports employees and leaders, accelerates growth for high-potential talent, and ensures our people practices are personalized across all generations and career paths.
Our game-changing people technology12 harnesses SAP’s own technological capabilities, delivering data-driven, AI-first, and personalized solutions for everyone at SAP. This will enable us to foster data-driven and transparent decision-making for leaders and allow everyone to grow and develop to their best abilities based on data insights. As the number one showcase of SAP SuccessFactors, we are actively driving the Human Capital Management (HCM) roadmap and pioneer innovations—for our customers too. This includes the acquisition of SmartRecruiters in 2025.
These pillars rest on the strong foundation of our people-centric work environment, which fosters employee well-being, safety, and health, as well as workplace diversity, and inclusion. Together, these elements are designed to establish a forward-thinking workplace.
#Unfiltered
y Methodologies and Definitions
#Unfiltered:13 Our employee engagement survey runs twice a year to measure key people metrics, engagement drivers, and employee sentiment. #Unfiltered is a demonstration of our commitment to listen regularly to our employees and act together on their feedback. In 2025, we ran surveys in April and October to gauge sentiment on employee engagement, leadership, health and well-being, and other topics. The average scores from both surveys were used to calculate the full-year Employee Engagement Index, Business Health Culture Index and Leadership Index.
Employee Engagement Index (EEI): For more information, see the Performance Management System section.
Business Health Culture Index (BHCI): In 2025, we revised the BHCI definition by adding equal opportunities as a new component of the index and replacing one of the health and well-being questions. For more information, see the Performance Management System section.
Leadership Index (LI): In 2025, we replaced the Leadership Trust Net Promoter Score with our new Leadership Index (LI). The LI is the percentage of favorable responses across six questions in the #Unfiltered survey. It reflects our leadership philosophy of “Develop People,” “Drive Transformation,” and “Deliver Results,” and also assesses trust in a leader’s competence, integrity, and in their care and concern for employees. By combining these components, the LI offers a nuanced view of leadership and gives leaders actionable bottom‑up feedback. To ensure a reliable baseline, the six questions used to calculate the new LI were included in the November 2024 #Unfiltered survey.
Inclusion Index: The Inclusion Index from our #Unfiltered survey demonstrates the extent to which SAP successfully offers employees a working environment that promotes a culture of inclusion. This index was calculated from the responses to three questions in the #Unfiltered April 2025 survey.
12 “Game-changing” refers to the use of our own technology, which transforms how we operate and supports data-driven decision-making, employee development, and business impact.
13 81,911 employees participated in the #Unfiltered survey in April (response rate: 74%); 82,362 employees participated in the #Unfiltered survey in October (response rate: 72%). All headcount-relevant employees, PhD students, and vocational trainees at SAP are eligible to take the survey unless: 1) They are employed by one of the acquired companies (SmartRecruiters, Taulia, or WalkMe); 2) they have taken the Voluntary Early Retirement Program (VERP); or 3) they are on long-term sick-leave. For Germany, non-headcount-relevant employees who have been with SAP for six months or longer are also invited to complete the survey. In 2024, 83,042 employees participated in the #Unfiltered survey in June (response rate: 76%); 77,577 employees participated in the survey in November (response rate: 70%). Simplification of Processes: In 2025, as part of broader updates to SAP’s survey landscape, the “Simplification of Processes” score was transitioned out of the #Unfiltered survey and will no longer be reported as part of the #Unfiltered metrics.
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The EEI is part of the short-term, one-year performance-based compensation (Short-Term Incentive, STI) of the Executive Board members. Employee Engagement rose two percentage points in 2025 to 76% (2024: 74%), landing at the mid-point of the target range for 2025 of 74% to 78%.
The BHCI is part of the long-term, three-year performance-based compensation (Long-Term Incentive, LTI) of the Executive Board members. We revised the composition of this index in 2025. The BHCI score for 2025 was 81%, which is at the midpoint of the target range of 80% to 82%, and one percentage point higher than the revised 2024 score of the index (2024: revised score 80%; reported score 78%). Based on the revision of the index composition we raised the 2025 target range to 80% to 82%, ensuring the same level of ambition for this performance measure (2024: reported target range 78% to 80%). For more information about the EEI and BHCI results and outlook for 2026, see the Performance Against Our Outlook for 2025 and Outlook for 2026 sections.
The Leadership Trust NPS was measured for the last time in 2024, scoring 68%, and has been replaced by the LI, which is based on a standard methodology. The LI currently stands at an 89% favorable rating, one percentage point higher than when it was last measured. The scores for each of the six items that make up the LI have remained largely at the same level, with no specific item showing a notable change.
We also track the Inclusion Index of our own workforce through our #Unfiltered survey, which allows us to take a deeper look at the aspects of gender, age, job level, and geography for all employee engagement scores. The Inclusion Index reached a strong 91% in 2025, up one percentage point on 2024.
We anticipated that some of the employee-relevant initiatives we implemented in 2025 would affect employee engagement. Our #Unfiltered employee engagement survey is designed to gauge employee sentiment at aggregated level and measures the cumulative effect of such initiatives. A year-over-year comparison of the index scores from #Unfiltered shows that they increased in 2025, indicating that the initiatives had no negative impact and that employee sentiment remained stable. This suggests that our communication, and the enablement and change support we provided, were at least sufficient to mitigate any potential adverse effects.
We use a number of feedback instruments within our continuous listening approach to assess how individual employees experience the various touchpoints along the employee lifecycle. This approach enables us to understand how employees perceive SAP, to enhance our processes, and to optimize the employee experience. We act on the feedback we receive from these various listening measures to improve organizational and team development. Our follow-up activities are driven by a two-fold approach: global focus areas are coordinated centrally, while team-related activities are coordinated within the respective teams.
Energy and Emissions
Our Approach and Policies
In light of the escalating effects of climate change and the global challenges it poses, climate action has been at the top of SAP’s corporate sustainability agenda for over a decade. We aim to take climate action through our dual approach as an enabler and exemplar. By helping pave the way toward a low-carbon future for our customers, partners, and SAP, we seek to create positive impact while respecting planetary boundaries.
The following sections describe in detail how we mitigate negative impacts and risks, and how we pursue positive impacts and opportunities through our policies, actions, targets, and metrics.
Our Actions and Targets
Transition Plan for Climate Change Mitigation
Our net-zero commitment is the cornerstone of our climate change mitigation. Under this commitment, we aim to reduce our gross greenhouse gas (GHG) emissions (market-based) by at least 90%14 across the value chain by 2030. Our net-zero target has been validated and approved by the Science Based Targets initiative (SBTi), which also verified that it is compatible with limiting global warming to 1.5°C, as advocated by the Paris Agreement. We consider the base year for our net-zero target, 2023, to be representative because we did not witness any atypical events in that year, such as pandemics, major mergers and acquisitions, and extreme weather episodes.
Progress on our transition plan for climate change mitigation is monitored by the ESG Steering Board at a detailed IRO level, and is on track.
14 All acquisitions after the baseline year 2023 are not considered.
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SAP’s ambitious climate change mitigation commitment has also been recognized by the investment market, as demonstrated by SAP’s inclusion in the EU Paris-aligned benchmarks.
Target | | Base Year | | Target Year | | Target Description | |
1.5°C-aligned science-based target (SBT) | 2023: 6.9 million tons gross GHG emissions (market-based) | 2030: reduction in gross GHG emissions (market-based) by at least 90%, which corresponds to less than 0.7 million tons (near-term and long-term target) 2026: steady decrease in GHG emissions across relevant value chains | Reduce SAP’s gross GHG emissions (market-based) across our value chain (Scopes 1, 2, and 3) by at least 90% to reach net-zero by 2030. Remaining residual emissions will be neutralized by a maximum of 10% carbon removals. Scope: GHG Protocol-aligned baseline, including Scope 1, Scope 2 market-based, and all business-relevant Scope 3 value chain emissions. | ||||
Net-Zero Target: Expected Impact of GHG Reduction Levers1
SAP aims to reach its net-zero target by focusing on four GHG reduction levers:
| – | Cloud transformation |
| – | Upstream supply chain |
| – | Own operations |
| – | Carbon removals |
In all four areas, leveraging our own solution portfolio is fundamental to improving how we manage and plan our initiatives, resources, and value chain partner relationships to achieve net-zero by 2030. When modeling our reduction pathway to 2030, we considered future developments—such as the expected growth of the Company and the effects from our cloud strategy—and any planned methodology adjustments. Our transition plan is closely aligned with our business model and financial planning, and is informed by SAP’s business trajectory and financial forecasts. We incorporate estimated company growth and cloud development projections to formulate a comprehensive emissions plan that reflects anticipated developments and considers investments in reducing GHG emissions. Taking this approach allows us to ensure that our climate change mitigation actions are viewed not as separate initiatives but as an integrated element of our financial growth strategy, corporate risk management, technology adoption, and product portfolio development. The climate scenario analysis we conducted in 2025 has no implicit impact on our GHG reduction levers. By way of these levers, SAP envisions that its net-zero transition plan will steadily reduce its GHG emissions. If GHG emissions remain, SAP plans to leverage removals in line with the SBTi standard as explained above.
Our Net Zero 2030 target is dependent on the following elements which are outside of SAP’s direct control:
| - | Progress and success of the decarbonization efforts of our suppliers |
| - | Changes in regulation such as the revision of the SBTi standards, expected to be finalized in 2026 |
| - | Due to the rapid development in the AI and general cloud infrastructure area and the resulting high energy needs it is unclear if this demand can be fully covered with renewable energy |
1 Expressed in millions of tons of CO2e.
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Due to these uncertainties, we are monitoring our progress in achieving the net zero target by 2030 and are continuously evaluating whether adjustments might be necessary.
Energy Consumption and Mix
in MWh (rounded to 100 MWh) | 2025 | 2024 | ||||||||||
Total Energy Consumption | 610,700 | 757,900 | ||||||||||
| Energy from Fossil | | Energy from Renewable | | Energy from Nuclear | | Energy from Fossil | | Energy from Renewable | | Energy from Nuclear | |
Sources |
| Sources1 |
| Sources | Sources |
| Sources1 |
| Sources | |||
Total Energy Consumption | 377,100 |
| 233,600 |
| 0 | 447,900 |
| 310,000 |
| 0 | ||
Scope 1 | |
| |
| | |
| |
| | ||
Fuel consumption from natural gas and other sources | |
| |
| | |
| |
| | ||
Stationary combustion2 | 80,100 |
| 1,900 |
| 0 | 92,600 |
| 1,100 |
| 0 | ||
Mobile combustion from corporate cars (gasoline, diesel) | 281,500 |
| 0 |
| 0 | 339,900 |
| 0 |
| 0 | ||
Mobile combustion from corporate jets (kerosene) | 7,200 |
| 0 |
| 0 | 7,900 |
| 0 |
| 0 | ||
Scope 2 | |
| |
| | |
| |
| | ||
Consumption of purchased or acquired electricity | |
| |
| | |
| |
| | ||
Electricity in office buildings | 0 |
| 108,900 |
| 0 | 0 |
| 112,000 |
| 0 | ||
Electricity in own data centers | 0 |
| 97,100 |
| 0 | 0 |
| 95,200 |
| 0 | ||
E-mobility electricity | 0 |
| 24,400 |
| 0 | 0 |
| 12,700 |
| 0 | ||
Consumption of purchased or acquired heat, steam, and cooling (district heating) | 8,300 |
| 0 |
| 0 | 7,500 |
| 0 |
| 0 | ||
1 Does not include Taulia and Volume Integration.
2 Refers to the consumption of (1) self-generated renewable energy (produced on-site), (2) the procurement of high-quality EACs, and starting 2025, (3) the procurement of biomethane (biogas) certificates.
3 This includes gas and oil heating systems in office buildings (owned and leased); the combustion of diesel in generators, and of gas in co-generation units and combined heat and power (CHP) systems. Our CHP system in Walldorf, Germany, uses wood pellets as a renewable source to generate heat.
Share of Energy Consumed1 | | 2025 |
| | 2024 |
|
Share of fossil sources in total energy consumption |
| 62 | % |
| 59 | % |
Share of consumption from nuclear sources in total energy consumption |
| 0 | % |
| 0 | % |
Share of renewable sources in total energy consumption |
| 38 | % |
| 41 | % |
1 Does not include Taulia and Volume Integration.
Disaggregation of Renewable Energy (including certificates) Sources1 (in MWh rounded to 100 MWh) | | 2025 | | 2024 |
Fuel consumption for renewable energy sources including biomass |
| 1,900 |
| 1,100 |
Consumption of purchased or acquired electricity, heat, steam and cooling from renewable sources |
| 230,300 |
| 307,600 |
Consumption of self-generated non-fuel renewable energy |
| 1,300 |
| 1,300 |
1 Does not include Taulia and Volume Integration.
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Intellectual Property, Proprietary Rights and Licenses
We rely on a combination of the protections provided by applicable statutory and common law rights, including trade secret, copyright, patent, and trademark laws, license and non-disclosure agreements, and technical measures to establish and protect our proprietary rights in our products. For further details on risks related to SAP’s intellectual property rights, see “Item 3. Key Information — Risk Factors — Operational Risks.”
We may be dependent in the aggregate on technology that we license from third parties that is embedded into our products or that we resell to our customers. We have licensed and will continue to license numerous third-party software products that we incorporate into and/or distribute with our existing products. We endeavor to protect ourselves in the respective agreements by obtaining certain rights in case such agreements are terminated.
We are a party to patent cross-license agreements with several third parties.
We are named as a defendant or plaintiff in various legal proceedings for alleged intellectual property infringements. See Note (G.3) to our Consolidated Financial Statements for a more detailed discussion relating to certain of these legal proceedings.
Description of Property
Our principal office is located in Walldorf, Germany, where we own and occupy approximately 406,000 square meters of office and datacenter space including our facilities in neighboring St. Leon-Rot. We also own and lease office space in various other locations in Germany, totaling approximately 138,000 square meters. In approximately 80 countries worldwide, we occupy roughly 1,492,000 square meters. Except for our main office in Germany, most of our office spaces are leased. We also own certain real estate properties in Newtown Square, Palo Alto, and Colorado Springs (United States); Bangalore (India); Sao Leopoldo (Brazil); London (UK); Ra’anana (Israel); Sofia (Bulgaria) and a few other locations.
The office and datacenter space we occupy includes approximately 295,000 square meters in the EMEA region, excluding Germany, approximately 296,000 square meters in North and Latin America, and approximately 358,000 square meters in the APJ Region.
The space is being utilized for various corporate functions including research and development, our data centers, customer support, sales and marketing, consulting, training, and administration. We started in 2023 with the renovation of our “headquarter building – WDF01” in Walldorf which won’t be usable until completion in 2027. The footprint of this building is not included in the 2025 numbers above. For a disclosure on our non-current assets by geographic region see Note (D.7) to our Consolidated Financial Statements. Also see, “Item 6. Directors, Senior Management and Employees — Employees,” which discusses the numbers of our employees, in FTE’s, by business area and by geographic region, which may be used to approximate the productive capacity of our workspace in each region.
We believe that our facilities are in good operating condition and adequate for our present usage. We do not have any significant encumbrances on our properties. We do not believe we are subject to any environmental issues that may affect our utilization of any of our material assets. We continue investing in the Flex Work readiness of our existing properties and where necessary we are undertaking capital investment activities to increase our capacity for future expansion of our business. We are also reviewing our portfolio to ensure that it covers our office space demands in line with the evolved Hybrid Work Guidance. Our significant construction activities are described below, under the heading “Principal Investments and Divestitures Currently in Progress.”
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Investments
Principal Investments Currently in Progress
In 2025, we finalized various construction projects and continued construction activities in several locations. We plan to finance all of these projects from operating cash flow. Our most important projects are listed below.
Construction Projects
€ millions | ||||||||||
Country | | Location of Facility | | Short Description | | Estimated Total | | Costs Incurred as at | | Estimated Completion |
Cost | 12/31/2025 | Date | ||||||||
Germany |
| Walldorf |
| General renovation of headquarters building for approx. 1,600 employees |
| 232 |
| 138 |
| Q3 2027 |
India |
| Bangalore |
| New office building for approx. 3,500 employees |
| 89 |
| 88 |
| Completed Q4 2025 |
India |
| Bangalore |
| New office building for approx. 5,000 employees |
| 99 |
| 0 |
| Q3 2028 |
Japan |
| Tokyo |
| Relocation and interior office build-out for approx. 650 employees |
| 24 |
| 0 |
| Q1 2027 |
There were no material divestitures of facilities within the reporting period.
Principal Investments and Divestitures for the Last Three Years
Our principal investments for property, plant, and equipment (other than from business combinations) amounted to €1,130 million in 2025 (2024: €1,138 million; 2023 €810 million). Principal investments in 2025 for property, plant, and equipment slightly decreased compared to 2024. The additions relate primarily to the replacement and purchase of information technology equipment and the construction and leasing of buildings and data centers. For further details related to property, plant, and equipment, see Note (D.4).
Our investments for intangible assets such as acquired technologies and customer relationships amounted to €285 million in 2025 compared to €591 million in 2024 (2023: €560 million). Our investments allocated to goodwill decreased to €523 million in 2025 from €765 million in 2024 (2023: €859 million). Based on the expected synergies, the goodwill added through the acquisition of SmartRecruiters (€523 million) was provisionally allocated to the Applications, Technology & Support segment on December 31, 2025, as the initial accounting for the SmartRecruiters business combination is still incomplete (for more information, see Note (D.1). For further details on investments related to acquisitions, see Notes (D.2) and (D.3) to our Consolidated Financial Statements.
For further information regarding the principal markets in which SAP conducts business, including a breakdown of total revenues by category of activity and geographic market for each of the last three years, see “Item 5. Operating and Financial Review and Prospects — Operating Results (IFRS)” of this report.
ITEM 4A. UNRESOLVED STAFF COMMENTS
None.
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ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
Overview
For information on our principal sources of revenue and how the different types of revenue are classified in our income statement refer to Note (A.1) to our Consolidated Financial Statements.
See “Item 4. Information about SAP — Products, Research & Development, and Services” for a more detailed description of the products and services we offer.
The following discussion is provided to enable a better understanding of our operating results for the periods covered, including:
| - | the factors that we believe impacted our performance in 2025; |
| - | our outlook for 2025 compared to our 2025 actual performance (non-IFRS); |
| - | a discussion of our operating results for 2025 compared to 2024 and for 2024 compared to 2023; |
| - | the factors that we believe will impact our performance in 2026; and |
| - | our financial targets and prospects. |
The preceding overview should be read in conjunction with the more detailed discussion and analysis of our financial condition and results of operations in this Item 5, “Item 3. Key Information — Risk Factors”, “Item 18. Financial Statements”,and Note (D.1).
Economy and the Market
World Economy
The global economy proved resilient in 2025, but remained subdued compared to its pre-pandemic average, reports the European Central Bank (ECB) in its most recent Economic Bulletin.1 Geopolitical tensions, particularly Russia’s war against Ukraine, and tariff negotiations remained major sources of uncertainty, weighing on the global economy. On the other hand, investments in artificial intelligence (AI), including semiconductors, strengthened global trade in technology products. Overall, economic growth was stronger in emerging market economies in 2025, with India standing out in particular.
Concerning the EMEA region in 2025, the ECB found that the economy grew more strongly in the euro area than expected and was mostly services-led. This applied particularly to the information and communication sector, while activity in industry and construction remained flat. All in all, the first half of the year was volatile due to frontloading in response to higher U.S. tariffs and related uncertainty. Only the second half of the year showed stronger domestic consumption and investment in connection with additional public spending on infrastructure and defense, particularly in Germany. Overall, the euro area economy also benefited from a robust labor market, with unemployment close to its historical low towards the end of 2025.
As for the Americas region and the United States, private consumption was more positive in 2025 than the ECB had previously expected. Investments in AI further supported U.S. economic growth. However, the federal government shutdown in the United States in the fourth quarter led to a decline mostly in services activity, but the manufacturing sector was also affected and could only partly offset the economic slowdown.
For the APJ region, the ECB reports that China’s economic activity grew moderately in both the services and the manufacturing sector in 2025. Domestic demand weakened yet export growth remained strong, with net exports contributing positively to economic progress. Toward the end of 2025, manufacturing activity contracted, whereas the services sector continued to expand, albeit more softly in the second half of the year.
1 European Central Bank, Economic Bulletin, Issue 8/2025, Publication Date: January 15, 2026.
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The IT Market
The global IT market sustained its growth momentum in 2025, underpinned by accelerating investments in AI-enabled transformation, modernization of ERP platforms, and widespread cloud adoption across industries. According to International Data Corporation (IDC), “The AI age is ushering a new ERP product that is using AI technology to enhance and augment the functionality,” with intelligent automation, autonomous workflows, and embedded decision support now defining enterprise technology innovation.1
Throughout 2025, the convergence of AI and enterprise applications matured rapidly, with AI-enabled ERP systems emerging as a key investment priority. According to IDC, “IDC's May 2025 SaaS Path Survey finds 44% of organizations plan to invest in AI-powered ERP applications, while 22% plan to replace their current applications if generative AI (GenAI) is not included in the next release.”2 These shifts reflect growing demand for business systems that deliver real-time insights, reduce manual workloads, and support autonomous operations at scale. As AI reshaped competitive dynamics across the software industry, enterprises increasingly distinguished between platforms that could integrate and scale intelligence effectively and those at risk of falling behind, particularly in environments requiring high reliability, security and regulatory compliance.
At the same time, the global cloud market continued to evolve from a foundational utility into a dynamic ecosystem powering the next wave of enterprise innovation. “The convergence of AI and cloud will give rise to agentic platforms that autonomously manage everything from workload placement to security, enabling a new level of efficiency and strategic value,”3 predicts IDC. Demand for cloud-based ERP remained especially strong, driven by the need to deploy intelligent systems at scale while reducing infrastructure complexity and costs. In parallel, rising customer and regulatory demands for data sovereignty accelerated sovereign cloud discussions across Europe and other regulated markets, reflecting growing emphasis on data residency, compliance, and operational control as integral components of enterprise cloud strategies.
These trends reinforced cloud ERP’s role as the dominant deployment model in the digital enterprise landscape in 2025. As AI adoption accelerated across the IT stack, organizations increasingly pursued modular, composable systems anchored in the cloud, signaling a fundamental shift in how business software is designed, delivered, and operated.
Impact on SAP
The year 2025 was a pivotal one for SAP, as the Company strengthened its leadership position in enterprise application software during a time of accelerated change across the IT landscape. In the face of macroeconomic uncertainty, driven in part by fluctuating trade policies and tariff volatility, SAP remained a trusted partner to both the world’s largest enterprises and smaller, fast-scaling businesses undergoing digital transformation.
During the year, customers increasingly looked to SAP not only for modernization but for solutions that could deliver tangible business value from AI within mission-critical processes. This reinforced SAP’s positioning as a leading AI-driven SaaS provider and reflected a broader shift in customer expectations toward scalable, outcome-oriented deployments. In particular, SAP’s approach to Business AI resonated with customers because it embeds AI directly into core business workflows and is powered by rich enterprise data, enabling customers to move beyond isolated use cases toward integrated, AI-enabled operations at scale.
At the same time, the broader IT market underwent a period of transition. Businesses continued to reassess their technology priorities in response to cost pressures, evolving architectural needs, and the rapid introduction of generative AI (gen AI) capabilities. This shift in focus from experimentation to value delivery favored vendors that could offer integrated platforms, operational flexibility, and enterprise-grade scale. SAP’s end-to-end portfolio, including RISE with SAP, SAP GROW, SAP Business Technology Platform (BTP), SAP Business Data Cloud, and Joule, aligned well with these evolving needs.
Geopolitical developments and increasing regulatory requirements also elevated data sovereignty from a compliance consideration to a strategic decision factor. Customers, particularly in regulated industries and the public sector, increasingly sought sovereign cloud solutions that deliver innovation while ensuring data residency, control, and regulatory compliance. These requirements are shaping customer cloud deployment decisions and operating models, reinforcing the importance of sovereign cloud capabilities as enterprises navigate a more fragmented global environment. SAP’s sovereign cloud strategy directly addresses these needs and represents a meaningful opportunity to support customers operating under heightened regulatory and geopolitical complexity.
As a result, SAP saw consistent momentum across its strategic product areas. Customers turned to our platform not only for modernization but also as a path to simplify operations and unlock new value through embedded intelligence.
1 IDC Worldwide Enterprise Resource Planning Applications Software Forecast, 2025-2029: AI Empowers the Future, September 2025, IDC #US53742525.
2 IDC MarketScape: Worldwide AI-Enabled Large Enterprise ERP Applications 2025 Vendor Assessment, October 2025, IDC #US52976925.
3 IDC FutureScape: Worldwide Cloud 2026 Predictions, October 2025, IDC #US53859425.
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Performance Against Our Outlook for 2025
As in previous years, our 2025 published financial outlook, except free cash flow and effective tax rate, is based on constant currencies. In this section, we therefore discuss performance against our outlook at constant currencies, unless otherwise stated. The results for 2024 are presented at actual currencies with the exception of growth rates, which are at constant currencies. For more information about our performance measures, see the Performance Management System section.
Strategic | KPI | Outlook for 2025 | Revised Outlook | |||||||
Objective | Results | (Integrated | for 2025 | Results | ||||||
| | for 2024 | | Report 2024) | | (Q3 Quarterly Statement) | | for 2025 | ||
Cloud revenue |
| €17.14 billion |
| €21.6 billion | €21.6 billion |
| €21.66 billion | |||
| to €21.9 billion | to €21.9 billion | ||||||||
(Toward the lower end) | ||||||||||
Cloud and software revenue |
| €29.83 billion |
| €33.1 billion |
| €33.1 billion |
| €33.44 billion | ||
Growth | to €33.6 billion | to €33.6 billion | ||||||||
Total revenue growth |
| 10% |
| To slightly accelerate |
| To slightly accelerate |
| 11% | ||
Current cloud backlog growth | 29% |
| To slightly decelerate |
| To slightly decelerate | 25% | ||||
Profitability | Operating profit (non-IFRS) |
| €8.15 billion |
| €10.3 billion |
| €10.3 billion |
| €10.66 billion | |
| to €10.6 billion |
| to €10.6 billion | |||||||
(Toward the upper end) | ||||||||||
Free cash flow1 |
| €4.22 billion |
| approx. €8.0 billion |
| €8.0 billion |
| €8.24 billion | ||
|
| to €8.2 billion | ||||||||
Customer loyalty | Customer NPS | 12 | 12 to 16 | 12 to 16 | 9 | |||||
Working environment | Business Health Culture Index | 80% | 80% to 82% | 80% to 82% | 81% | |||||
Employee engagement | Employee Engagement Index |
| 74% |
| 74% to 78% |
| 74% to 78% |
| 76% | |
Climate performance | Gross greenhouse gas emissons |
| 6.9 Mt |
| To steadily decrease carbon emissions across the relevant value chain |
| To steadily decrease carbon emissions across the relevant value chain |
| 6.3 Mt |
1 at actual currencies
Changes in our outlook within the year 2025 have been marked bold. The outlook for 2025 in our Q1 Quarterly Statement and Q2 Quarterly Statement remained unchanged.
Financial Performance
Our current cloud backlog (contractually committed cloud revenue that we expect to recognize over the upcoming 12 months) reached €21.05 billion at actual currencies (€22.54 billion at constant currencies; 2024: €18.08 billion at actual currencies), which was an increase of 25% on a constant currency basis (2024: 29% at constant currencies). This represents a more pronounced slowdown in the growth rate than anticipated. Large transformational deals with high cloud revenue ramps in outer years and termination for convenience clauses required by law negatively impacted constant currency current cloud backlog growth by approximately 1pp.
The resulting cloud revenue grew from €17.14 billion (at actual currencies) in 2024 to €21.66 billion (at constant currencies) in 2025, in line with our revised guidance range toward the lower end of €21.6 billion to €21.9 billion. That represents an increase of 26% at constant currencies. Cloud and software revenue grew 12% at constant currencies to €33.44 billion (2024: €29.83 billion at actual currencies) and thus ended in line with our outlook range for 2025 of €33.1 billion to €33.6 billion. Total revenue on a constant currency basis grew 11% in 2025 to €37.80 billion (2024: €34.18 billion at actual currencies), thus marking a slight acceleration in the growth rate. For more information about revenue, see the Revenue section.
Non-IFRS operating profit in 2025 was €10.66 billion on a constant currency basis (2024: €8.15 billion at actual currencies), reflecting a strong increase of 31% at constant currencies. IFRS and non-IFRS operating profit and margin benefitted from a strong cloud revenue growth and from the results of the Company-wide restructuring program which was announced in January 2024 and concluded in early 2025. Non-IFRS operating profit came in above our revised guidance range toward the upper end of €10.3 billion to €10.6 billion at constant currencies. For more information about IFRS operating profit, see the Operating Profit and Operating Margin section.
For the full year, free cash flow increased 95% to €8.24 billion (2024: €4.22 billion). The improvement compared to the prior year was mainly attributable to higher profitability and to lower payments for restructuring and share-based compensation. For more information about free cash flow, see the Analysis of Consolidated Statements of Cash Flow section.
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The IFRS effective tax rate was 28.7% (2024: 33.9%) and the non-IFRS effective tax rate was 30.5% (2024: 32.3%). The IFRS effective tax rate is lower than the non-IFRS tax rate due to tax benefits from tax-exempt income.
Non-Financial Performance
In 2025, our Customer NPS decreased three points year over year to 9 (2024: 12), which is below our target range of 12 to 16. The Business Health Culture Index increased 1pp to 81% (2024: 80%), at the midpoint of the target range of 80% to 82%. The Employee Engagement Index for the full year 2025 increased 2pp year over year to 76% (2024: 74%), at the midpoint of the target range of 74% to 78%. Total carbon emissions decreased to 6.3 megatonnes (Mt) in 2025 (2024: 6.9 Mt), in line with our guidance for a steady decrease.
Executive Board’s Assessment
Despite a greater-than-expected deceleration of the cloud backlog growth rate to 25% at constant currencies, total cloud backlog performed strongly, increasing 30% at constant currencies to €77 billion, partially due to large transformational deals with high cloud revenue ramps in outer years. At the same time, we see SAP Business AI gaining momentum, with more than two-thirds of our cloud order entry containing SAP Business AI in the fourth quarter of 2025 and therefore increasing more than 20pp compared to the third quarter of 2025. This performance demonstrates the underlying momentum of our business, as well as our potential for the future.
Our ability to drive top line growth while exceeding our profitability and free cash flow expectations reflects the consistent execution against the outlook we provided at the beginning of the year. While the macroeconomic challenges persisted, we took deliberate steps to reinforce our foundation and align the business for durable, sustainable performance.
Overall, the course of business in the reporting year was favorable.
Operating Results (IFRS)
This section on operating results (IFRS) discusses results only in terms of IFRS measures.
Our 2025 Results Compared to Our 2024 Results (IFRS)
Revenue
1 The numbers for 2020 were not restated as a result of the divestiture of Qualtrics in 2023. Therefore, the growth rate for 2021 does not reflect continuing operations.
Total revenue rose from €34,176 million in 2024 to €36,800 million in 2025, representing an increase of €2,625 million, or 8%. This increase was driven by the revenues generated by our cloud business.
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Cloud and software revenue grew from €29,830 million in 2024 to €32,538 million in 2025, representing an increase of 9%. Cloud and software revenue represented 88% of total revenue in 2025 (2024: 87%). Subscription revenue increased 22% from €17,442 million in 2024 to €21,328 million in 2025. For more information about the definition of subscription revenue, see the Performance Management System section.
For a detailed description of our revenue types, see the Notes to the Consolidated Financial Statements, Note (A.1). For more information about our regional performance, see the Revenue by Region section.
1 The numbers for 2020 were not restated as a result of the divestiture of Qualtrics in 2023. Therefore, the growth rate for 2021 does not reflect continuing operations.
Cloud revenue increased €3,883 million, or 23%, from €17,141 million in 2024 to €21,023 million in 2025, primarily fueled by Cloud ERP Suite revenue, which grew €3,954 million, or 28%, to €18,119 million in 2025 (2024: €14,165 million). Cloud ERP Suite contributed 86% to overall cloud revenue (2024: 83%). Cloud ERP Suite revenue growth benefitted from the accelerated transition of our customers to the cloud. Extension Suite cloud revenue grew from €2,436 million in 2024 to €2,559 million in 2025, representing an increase of 5%. In 2025, the IaaS cloud revenue declined €195 million, or 36%, to €345 million (2024: €540 million) in line with our strategic focus on SaaS / PaaS. For more information about Cloud ERP Suite, see the Performance Management System section.
The current cloud backlog increased €2.97 billion, or 16%, to €21.05 billion in 2025 (2024: €18.08 billion). Our total cloud backlog increased 22% from €63.29 billion in 2024 to €77.29 billion in 2025.
Software licenses and software support revenue decreased €1,174 million, or 9%, from €12,689 million in 2024 to €11,515 million in 2025.
Our software licenses revenue declined €409 million from €1,399 million in 2024 to €990 million in 2025. The continuous decline is in line with our cloud transformation.
Software support revenue decreased €765 million, or 7% from €11,290 million in 2024 to €10,525 million in 2025. The decline is attributable to the accelerated transition of our customers to the cloud.
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Services revenue declined slightly, by €84 million, or 2%, from €4,346 million in 2024 to €4,262 million in 2025, mainly due to a decline in revenues from our training business. The strategic focus of our services business is to drive adoption of our cloud solutions.
Revenue by Region
EMEA Region
In 2025, the EMEA region generated €17,025 million in revenue (2024: €15,575 million), which was 46% of our total revenue (2024: 46%) and an increase of 9%. Revenue in Germany increased 9% to €5,828 million (2024: €5,359 million). Germany contributed 34% (2024: 34%) of all EMEA region revenue. In the remaining countries of the EMEA region, revenue increased 10%. Among the remaining EMEA countries, the largest contributions came from France, the Netherlands, Switzerland, and the United Kingdom.
Cloud and software revenue generated in the EMEA region totaled €15,013 million (2024: €13,534 million), which represents 88% of all revenue from the region (2024: 87%). Cloud revenue in the EMEA region rose 29% to €8,876 million in 2025 (2024: €6,892 million). Notably, the cloud revenue performance was strong in France, Germany, Italy, Saudi Arabia, Spain, and the United Kingdom. Software licenses and software support revenue decreased 8% to €6,137 million in 2025 (2024: €6,643 million).
Americas Region
In 2025, 39% of our total revenue was generated in the Americas region (2024: 40%). Total revenue in the Americas region increased 5% to €14,499 million (2024: €13,808 million). Revenue in the United States increased 4% to €11,537 million (2024: €11,056 million). The United States contributed 80% (2024: 80%) of all revenue generated in the Americas region. In the remaining countries of the Americas region, revenue increased 8%. The remaining revenue in the Americas region was primarily generated in Brazil, Canada, and Mexico.
Cloud and software revenue generated in the Americas region totaled €12,744 million (2024: €11,987 million), which represents 88% of all revenue from the region (2024: 87%). Cloud revenue in the Americas region rose 15% to €9,075 million in 2025 (2024: €7,872 million). The United States contributed 79% of cloud revenue generated in the Americas region. Notably, the cloud revenue performance was strong in Brazil and the United States. Software licenses and software support revenue in the Americas region decreased 11% to €3,669 million in 2025 (2024: €4,116 million).
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APJ Region
In 2025, 14% of our total revenue was generated in the APJ region (2024: 14%). Total revenue in the APJ region increased 10% to €5,276 million (2024: €4,793 million). Total revenue in Japan increased 13% to €1,569 million (2024: €1,388 million). Revenue from Japan accounted for 30% of all revenue generated in the APJ region (2024: 29%). In the remaining countries of the APJ region, revenue increased 9%. Revenue in the remaining countries of the APJ region was primarily generated in Australia, China, and India.
Cloud and software revenue in the APJ region totaled €4,781 million (2024: €4,308 million). That represents 91% of all revenue from the region (2024: 90%). Cloud revenue in the APJ region rose 29% to €3,072 million in 2025 (2024: €2,377 million). Notably, the cloud revenue performance was strong in China, India, Japan, and South Korea. Software licenses and software support revenue decreased 11% from €1,931 million in 2024 to €1,709 million in 2025.
Operating Profit and Operating Margin
Operating profit increased to €9,617 million and operating margin improved by 12.5pp to 26.1%. Operating profit was positively impacted by an increased contribution from cloud revenue and by lower total operating expenses.
The operating profit benefitted from a decline in restructuring expenses from €3,144 million in 2024 to €3 million in 2025. This decline is associated with the Company-wide restructuring program that was announced in January 2024 and concluded in early 2025 as planned. Under this program, SAP increased its focus on key strategic growth areas, particularly business AI, in 2025. For more information about the program, see the Notes to the Consolidated Financial Statements, Note (B.6).
Share-based payment expenses fell to €1,695 million (2024: €2,385 million), mainly due to a reduction in the SAP share price of more than €25 (compared to an increase of more than €95 in 2024), as well as a lower grant volume compared to prior years. Our 2024 share-based payment expenses included SAP’s temporary increased contribution (from 40% to 100% from October to December 2024) to the Own SAP Plan to recognize its employees’ contribution to SAP’s success in 2024. For more information about share-based payments, see the Notes to the Consolidated Financial Statements, Note (B.3).
In 2025, the operating profit was negatively impacted by higher termination benefits outside of restructuring plans. The respective expenses increased in 2025 compared to 2024 (2025: €238 million compared to 2024: €68 million), mainly due to €191 million in expenses recognized under the workforce transformation announced at the end of July 2025.
Furthermore, the operating profit was negatively impacted by a provision of €387 million (2024: €0 million) related to the Teradata litigation. For more information about the Teradata litigation, see the Notes to the Consolidated Financial Statements, Note (G.3).
A change in case law resulted in an increase in other taxes by €98 million (2024: €0 million) negatively affecting SAP’s operating profit in the third quarter of 2025. For more information about tax-related litigation, see the Notes to the Consolidated Financial Statements, Note (C.5) and Note (G.3).
1 The numbers for 2020 were not restated as a result of the divestiture of Qualtrics in 2023. Therefore, the growth rate for 2021 does not reflect continuing operations.
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Changes to the individual elements in our cost of revenue were as follows:
Cost of Cloud and Software
Cost of cloud and software consists primarily of costs for deploying and operating cloud solutions, the cost of developing custom solutions that address customers’ specific business requirements, and customer support costs.
In 2025, the cost of cloud and software increased 15% to €6,793 million (2024: €5,922 million) and our cloud margin increased 1.1pp from 72.8% in 2024 to 73.9% in 2025. This was attributable to strong revenue growth, primarily driven by Cloud ERP Suite revenue, paired with a slower growth in cost of cloud due to a scalable cloud infrastructure and operational efficiency. The increase in cost of cloud was mainly driven by higher volume and the associated additional expenses for procurement of instances for computing resources. The software licenses and software support margin was 88.6% in 2025, 1.5pp below the prior-year level (2024: 90.1%). Software licenses and software support revenue decreased 9% to €11,515 million (2024: €12,689 million), primarily attributable to a 29% decline in software license revenue. Software licenses and software support costs increased 4% year over year to €1,313 million (2024: €1,262 million) partially due to expenses related to the Teradata litigation.
Cost of Services
Cost of services consists primarily of the cost of consulting, premium services, and training courses. The cost of services decreased 4% in 2025 to €3,193 million (2024: €3,321 million). Our gross margin on services, which is defined as services profit as a percentage of services revenue, increased 1.5pp to 25.1% (2024: 23.6%). As our services business trends away from traditional software licensing and consulting revenue toward more revenue from cloud solutions, we continue to adjust our service delivery resources to support our cloud offerings.
Research and Development
Our research and development (R&D) expenses consist primarily of the personnel cost of our R&D employees, costs incurred for independent contractors whom we retain to assist in our R&D activities, data center infrastructure used for R&D activities, and depreciation of the computer hardware and amortization of the software we use for our R&D activities.
The R&D expense rose 2% to €6,633 million in 2025 from €6,514 million in 2024. This increase is primarily due to higher but disciplined use of contingent workforce in 2025. Lower share-based payment expenses partially offset the higher expenses for research and development. R&D expense as a percentage of total revenue decreased to 18.0% in 2025 (2024: 19.1%). For more information, see the Our Investments in Innovation section.
Sales and Marketing Expense
Sales and marketing expenses consist mainly of personnel costs, direct sales costs, and the cost of marketing our products and services.
Our sales and marketing expenses declined 2% from €9,090 million in 2024 to €8,879 million in 2025. This decrease is mainly attributable to reduced share-based payment expenses, partially offset by higher expenses for the SAP PartnerEdge program, which includes higher amortizations for sales commissions and higher costs for post-sales services. The ratio of sales and marketing expense to total revenue, expressed as a percentage, decreased 2.5pp in 2025 to 24.1% (2024: 26.6%).
General and Administration Expense
Our general and administration expenses consist mainly of personnel costs to support our finance and administration, human resources, and corporate functions.
General and administration expense increased 14% from €1,435 million in 2024 to €1,633 million in 2025. This increase is primarily due to higher but disciplined use of contingent workforce in 2025 as well as expenses related to the Teradata litigation. Lower share-based payment expenses partially offset the higher expenses for general and administration. The ratio of general and administration expense to total revenue increased by 0.2pp in 2025 to 4.4% (2024: 4.2%).
Segment Information
At year end 2025, SAP had two operating, reportable segments: the Applications, Technology & Support (ATS) segment and the Core Services segment.
| - | The ATS segment represents SAP’s cohesive product portfolio, which is holistically steered and commercialized. It primarily generates revenue from cloud subscriptions and support offerings, and it incurs costs for operating our cloud solutions and customer support. The revenue and cost for services arise from SAP’s training business, which is highly integrated with SAP’s product portfolio. |
| - | The Core Services segment supports SAP’s product portfolio by enabling customers to accelerate the adoption of innovations. Revenues are mainly generated from professional consulting services and premium support services. Cost is incurred primarily for the delivery of those services. The Core Services segment does not reflect the full services business. |
For more information about our segment reporting, see the Notes to the Consolidated Financial Statements, Note (C.1) and Note (C.2).
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ATS
| 2025 | | 2024 | | ∆ in % | | ∆ in % | |||
| Actual | | Constant | | Actual | | Actual | | Constant | |
€ millions (non-IFRS) | Currency | Currency | Currency | Currency | Currency | |||||
Cloud | 21,023 | 21,661 | 17,141 | 23 | 26 | |||||
Software licenses | 990 | 1,020 | 1,399 | -29 | -27 | |||||
Software support | 10,525 | 10,754 | 11,290 | -7 | -5 | |||||
Software licenses and support | 11,515 | 11,774 | 12,689 | -9 | -7 | |||||
Cloud and software | 32,538 | 33,435 | 29,829 | 9 | 12 | |||||
Services | 309 | 316 | 418 | -26 | -24 | |||||
Total segment revenue | 32,847 | 33,751 | 30,248 | 9 | 12 | |||||
Cost of cloud | -5,084 | -5,276 | -4,446 | 14 | 19 | |||||
Cost of software licenses and support | -1,109 | -1,143 | -1,169 | -5 | -2 | |||||
Cost of cloud and software | -6,193 | -6,419 | -5,615 | 10 | 14 | |||||
Cost of services | -349 | -357 | -385 | -9 | -7 | |||||
Total cost of revenue | -6,542 | -6,775 | -6,000 | 9 | 13 | |||||
Segment gross profit | 26,305 | 26,976 | 24,248 | 8 | 11 | |||||
Other segment expenses | -12,959 | -13,328 | -12,995 | 0 | 3 | |||||
Segment profit (loss) | 13,345 | 13,647 | 11,253 | 19 | 21 | |||||
In 2025, the Applications, Technology & Support segment significantly increased its cloud revenue by 23% (26% at constant currencies), driven by a strong performance of Cloud ERP Suite. At the same time, the cost of cloud increased moderately by 14% (19% at constant currencies).
Software support revenue decreased 7% (5% at constant currencies) to €10,525 million (2024: €11,290 million) and software licenses revenue decreased 29% (27% at constant currencies) to €990 million (2024: €1,399 million) as more of our existing customers chose our cloud offerings. Consequently, the Applications, Technology & Support segment recorded a total software licenses and support revenue of €11,515 million (2024: €12,689 million), representing a decline of 9% (7% at constant currencies).
As such, the total segment revenue increased 9% (12% at constant currencies) compared to the prior year, to €32,847 million (2024: €30,248 million). The total segment cost of revenue grew 9% (13% at constant currencies), mainly driven by an increase in cost of cloud. Other segment expenses remained stable (grew 3% at constant currencies) and ended 2025 at €12,959 million (2024: €12,995 million).
As a result, segment profit increased 19% (21% at constant currencies), from €11,253 million in 2024, to €13,345 million.
Core Services
| 2025 | | 2024 | | ∆ in % | | ∆ in % | |||
| Actual | | Constant | | Actual | | Actual | | Constant | |
€ millions (non-IFRS) | Currency | Currency | Currency | Currency | Currency | |||||
Services | 3,953 | 4,053 | 3,927 | 1 | 3 | |||||
Total segment revenue | 3,953 | 4,053 | 3,927 | 1 | 3 | |||||
Cost of cloud | -120 | -124 | -108 | 11 | 14 | |||||
Cost of software licenses and support | -39 | -40 | -49 | -21 | -19 | |||||
Cost of cloud and software | -159 | -164 | -158 | 1 | 4 | |||||
Cost of services | -2,773 | -2,843 | -2,850 | -3 | 0 | |||||
Total cost of revenue | -2,932 | -3,007 | -3,008 | -3 | 0 | |||||
Segment gross profit | 1,021 | 1,046 | 920 | 11 | 14 | |||||
Other segment expenses | -590 | -605 | -637 | -7 | -5 | |||||
Segment profit (loss) | 432 | 440 | 283 | 53 | 56 | |||||
The Core Services segment closed 2025 with an increase in segment services revenue of 1% (3% at constant currencies).
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The segment cost of services slightly decreased 3% (0% at constant currencies) during 2025. This decrease was primarily attributable to the positive cost development of SAP’s consulting and premium engagement business and lower share-based payment expenses. The efficiencies were predominantly driven by the restructuring program that was initiated in 2024 and concluded at the beginning of 2025, which led to a more favorable delivery mix. The other segment expenses declined 7% (5% at constant currencies).
Overall, the Core Services segment profit increased 53% (56% at constant currencies) to €432 million in 2025 (2024: €283 million).
Financial Income, Net
Financial income, net, improved to €534 million (2024: €398 million). Our finance income was €1,911 million (2024: €1,429 million) and our finance costs were €1,377 million (2024: €1,031 million).
Finance income primarily consists of interest income on investments in the amount of €428 million (2024: €631 million) and gains from IFRS 9-related fair value adjustments, mainly of Sapphire Ventures investments, and the disposal of equity securities totaling €1,393 million (2024: €779 million).
Finance costs mainly consist of interest expense on financial liabilities and from derivative instruments amounting to €492 million (2024: €545 million), and IFRS 9-related fair value adjustments or losses from disposal of Sapphire Ventures investments totaling €631 million (2024: €316 million). For more information about financing instruments, see the Notes to the Consolidated Financial Statements, Note (D.1) and Note (E.3).
Income Taxes
The effective tax rate in 2025 was 28.7% (2024: 33.9%). The year-over-year decrease mainly resulted from changes in withholding taxes. For more information about income taxes, see the Notes to the Consolidated Financial Statements, Note (C.5).
Our 2024 Results Compared to Our 2023 Results (IFRS)
Total Revenue
Total revenue rose from €31,207 million in 2023 to €34,176 million in 2024, representing an increase of €2,968 million, or 10%. This increase was predominantly driven by the revenues generated by our cloud business. Cloud revenue growth was largely due to a rise in the number of customers using multiple SAP solutions, with those using over four SAP solutions more than doubling since 2021 and now accounting for over 20% of our customer base.
Cloud and software revenue represented 87% of total revenue in 2024 (2023: 86%). Services revenue increased 1% from €4,283 million in 2023 to €4,346 million in 2024, which was 13% of total revenue (2023: 14%).
For a detailed description of our revenue types, see the Notes to the Consolidated Financial Statements, Note (A.1).
For more information about our regional performance, see the Revenue by Region section.
Cloud and Software Revenue
Cloud and software revenue grew from €26,924 million in 2023 to €29,830 million in 2024, representing an increase of 11%.
Cloud Revenue
Cloud revenue increased €3,477 million, or 25%, from €13,664 million in 2023 to €17,141 million in 2024, fueled by Cloud ERP Suite revenue, which grew €3,540 million, or 33%, to €14,166 million in 2024 (2023: €10,626 million). Cloud ERP Suite contributed 83% to overall cloud revenue (2023: 78%). Cloud ERP Suite revenue growth benefitted from the accelerated transition of our customers to the cloud. Extension Suite cloud revenue grew from €2,290 million in 2023 to €2,435 million in 2024, representing an increase of 6%. In 2024, the IaaS cloud revenue declined €208 million, or 28%, to €540 million (2023: €748 million). For more information about Cloud ERP Suite, see the Performance Management System section.
The current cloud backlog increased €4,333 million, or 32%, to €18,078 million in 2024 (2023: €13,745 million). Our total cloud backlog increased 43% from €44.25 billion in 2023 to €63.29 billion in 2024.
Software Licenses and Support
Our software licenses revenue declined €365 million from €1,764 million in 2023 to €1,399 million in 2024. The continuous decline is in line with our cloud transformation.
The demand for SAP software helped us maintain a stable maintenance customer base for software support, resulting in software support revenue of €11,290 million in 2024 (2023: €11,496 million). The slight decline is attributable to the accelerated transition of our customers to the cloud. SAP Enterprise Support was the largest contributor to our software support revenue.
Software licenses and software support revenue decreased €572 million, or 4%, from €13,261 million in 2023 to €12,689 million in 2024.
We define more predictable revenue as the sum of our cloud revenue and our software support revenue. Our more predictable revenue increased 13%, from €25,160 million in 2023 to €28,431 million in 2024. This increase was predominantly driven by the revenues generated by our cloud business. More predictable revenue accounted for 83% of our total revenue in 2024 (2023: 81%), continuing the upward trend from prior years.
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Services Revenue
Services revenue increased slightly, by €63 million, or 1%, from €4,283 million in 2023 to €4,346 million in 2024, fueled by consulting revenue and premium support revenue, which increased €99 million, or 3%, from €3,874 million in 2023 to €3,973 million in 2024. In 2024, consulting and premium support revenue contributed 91% of the total services revenue (2023: 90%) and 12% of total revenue (2023: 12%).
Revenue from other services decreased €36 million, or 9%, to €373 million in 2024 (2023: €409 million).
Revenue by Region
EMEA Region
In 2024, the EMEA region generated €15,575 million in revenue (2023: €14,004 million), which was 46% of total revenue (2023: 45%). Revenue in Germany increased 9% to €5,359 million (2023: €4,921 million). Germany contributed 34% (2023: 35%) of all EMEA region revenue. The remaining revenue in the EMEA region was primarily generated in France, Italy, the Netherlands, Switzerland, and the United Kingdom.
Cloud and software revenue generated in the EMEA region totaled €13,534 million (2023: €12,028 million), which represents 87% of all revenue from the region (2023: 86%). Cloud revenue in the EMEA region rose 32% to €6,892 million in 2024 (2023: €5,241 million). Software licenses and software support revenue decreased 2% to €6,643 million in 2024 (2023: €6,787 million).
Americas Region
In 2024, 40% of our total revenue was generated in the Americas region (2023: 41%). Total revenue in the Americas region increased 8% to €13,808 million (2023: €12,762 million). Revenue in the United States increased to €11,056 million (2023: €10,204 million). The United States contributed 80% (2023: 80%) of all revenue generated in the Americas region. In the remaining countries of the Americas region, revenue increased 8% to €2,752 million. The remaining revenue in the Americas region was primarily generated in Brazil, Canada, and Mexico.
Cloud and software revenue generated in the Americas region totaled €11,987 million (2023: €10,959 million), which represents 87% of all revenue from the region (2023: 86%). Cloud revenue in the Americas region rose 19% to €7,872 million in 2024 (2023: €6,642 million). The United States contributed 80% of cloud revenue generated in the Americas region. Software licenses and software support revenue in the Americas regions amounted to €4,116 million in 2024 (2023: €4,317 million).
APJ Region
In 2024, 14% of our total revenue was generated in the APJ region (2023: 14%). Total revenue in the APJ region increased 8% to €4,793 million (2023: €4,441 million). Total revenue in Japan increased to €1,388 million (2023: €1,243 million). Revenue from Japan accounted for 29% of all revenue generated in the APJ region (2023: 28%). In the remaining countries of the APJ region, revenue increased 6%. Revenue in the remaining countries of the APJ region was primarily generated in Australia, China, and India.
Cloud and software revenue in the APJ region totaled €4,308 million (2023: €3,937 million). That represents 90% of all revenue from the region (2023: 89%). Cloud revenue in the APJ region rose 33% to €2,377 million in 2024 (2023: €1,781 million). Software licenses and software support revenue decreased from €2,156 million in 2023 to €1,931 million in 2024.
Operating Profit and Operating Margin
Operating profit decreased to €4,665 million and operating margin declined by 4.9pp to 13.6%. Operating profit was impacted by a reduced contribution from software licenses revenue and from increased total operating expenses.
In 2024, SAP increased its focus on key strategic growth areas, in particular Business AI. To this end, as announced in January 2024, SAP has executed a company-wide restructuring program which concluded as planned at the beginning of 2025. In 2024, SAP recognized restructuring expenses amounting to €3,144 million (2023: €215 million).
Share-based payment expenses rose to €2,385 million (2023: €2,220 million), mainly due to an increase in the SAP share price of more than €95 in 2024 (compared to an increase of more than €40 in 2023) and SAP’s temporarily increased contribution (from 40% to 100% from October to December 2024) to the Own SAP Plan to recognize its employees’ contribution to SAP’s success in 2024.
Furthermore, operating profit was impacted by expenses for sales and marketing initiatives to capture current and future growth opportunities.
Changes to the individual elements in our cost of revenue were as follows:
Cost of Cloud and Software
In 2024, the cost of cloud and software increased 12% to €5,922 million (2023: €5,267 million) and our cloud margin increased 1.2pp from 71.6% in 2023 to 72.8% in 2024, based on strong revenue growth paired with a slower growth in cost of cloud due to a scalable cloud infrastructure and operational efficiency. The software licenses and software support margin was 90.1% in 2024, 0.5pp above the prior-year level (2023: 89.6%). Software licenses and software support revenue decreased 4% to €12,689 million (2023: €13,261 million), primarily attributable to a 21% decline in software license revenue. Software licenses and software support costs decreased 9% year over year to €1,262 million (2023: €1,383 million).
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Cost of Services
Cost of services consists primarily of the cost of consulting, premium services, and training courses, and the cost of bought-in consulting and training resources. The cost of services decreased 3% to €3,321 million (2023: €3,407 million). Our gross margin on services, which is defined as services profit as a percentage of services revenue, increased 3.1pp to 23.6% (2023: 20.5%). As our services business trends away from traditional software licensing and consulting revenue toward more subscription revenue from cloud solutions, we continue to adjust our service delivery resources to support our cloud offerings.
Research and Development
Our research and development (R&D) expense consists primarily of the personnel cost of our R&D employees, costs incurred for independent contractors whom we retain to assist in our R&D activities, data center infrastructure used for R&D activities, and depreciation of the computer hardware and amortization of the software we use for our R&D activities.
The R&D expense rose 3% to €6,514 million in 2024 from €6,324 million in 2023. This increase was mainly due to higher personnel costs driven by higher share-based payment expenses. R&D expense as a percentage of total revenue decreased to 19.1% in 2024 (2023: 20.3%).
Sales and Marketing Expense
Our sales and marketing expense grew 3% from €8,828 million in 2023 to €9,090 million in 2024. This increase is mainly attributable to several marketing initiatives to capture current and future growth opportunities.
The ratio of sales and marketing expense to total revenue, expressed as a percentage, decreased 1.7pp in 2024 to 26.6% (2023: 28.3%).
General and Administration Expense
General and administration expense increased 5% from €1,364 million in 2023 to €1,435 million in 2024. This increase is primarily due to higher personnel expenses in 2024, the majority thereof due to higher share-based payment expenses. The ratio of general and administration expense to total revenue decreased 0.2pp year over year to 4.2% (2023: 4.4%).
Segment Information
The segment information below for 2024 and 2023 is presented for the two operating segments Applications, Technology & Support and Core Services. For more information about our segment reporting and the changes in the composition of our reportable segments, see the Notes to the Consolidated Financial Statements, Notes (C.1) and (C.2), and the Performance Management System section.
Applications, Technology & Support
| 2024 | | 2023 | | ∆ in % | | ∆ in % | |||
| Actual | | Constant | | Actual | | Actual | | Constant | |
€ millions (non-IFRS) | Currency | Currency | Currency | Currency | Currency | |||||
Cloud | 17,141 | 17,212 | 13,664 | 25 | 26 | |||||
Software licenses | 1,399 | 1,400 | 1,764 | -21 | -21 | |||||
Software support | 11,290 | 11,343 | 11,496 | -2 | -1 | |||||
Software licenses and support | 12,689 | 12,743 | 13,260 | -4 | -4 | |||||
Cloud and software | 29,829 | 29,955 | 26,924 | 11 | 11 | |||||
Services | 418 | 415 | 435 | -4 | -5 | |||||
Total segment revenue | 30,248 | 30,370 | 27,359 | 11 | 11 | |||||
Cost of cloud | -4,446 | -4,460 | -3,692 | 20 | 21 | |||||
Cost of software licenses and support | -1,169 | -1,174 | -1,259 | -7 | -7 | |||||
Cost of cloud and software | -5,615 | -5,634 | -4,951 | 13 | 14 | |||||
Cost of services | -385 | -380 | -405 | -5 | -6 | |||||
Total cost of revenue | -6,000 | -6,014 | -5,356 | 12 | 12 | |||||
Segment gross profit | 24,248 | 24,356 | 22,003 | 10 | 11 | |||||
Other segment expenses | -12,995 | -13,027 | -12,493 | 4 | 4 | |||||
Segment profit (loss) | 11,253 | 11,329 | 9,510 | 18 | 19 | |||||
In 2024, the Applications, Technology & Support segment significantly increased its cloud revenue by 25% (26% at constant currencies), driven by a strong performance of Cloud ERP Suite. At the same time, the cost of cloud increased by 20% (21% at constant currencies).
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Software support revenue decreased 2% (1% at constant currencies) to €11,290 million (2023: €11,496 million) and software licenses revenue decreased 21% (21% at constant currencies) to €1,399 million (2023: €1,764 million) as more of our existing customers chose our cloud offerings. Consequently, the software licenses and support revenue declined 4% (4% at constant currencies) to €12,689 million (2023: €13,260 million).
As such, the total segment revenue increased 11% (11% at constant currencies) compared to the prior year, to €30,248 million (2023: €27,359 million). The total segment cost of revenue grew 12% (12% at constant currencies), mainly driven by an increase in cost of cloud. Other segment expenses inreased 4% (4% at constant currencies) and ended 2024 at €12,995 million (2023: €12,493 million).
As a result, segment profit increased 18% (19% at constant currencies), from €9,510 million in 2023, to €11,253 million.
Core Services
| 2024 | | 2023 | | ∆ in % | | ∆ in % | |||
| Actual | | Constant | | Actual | | Actual | | Constant | |
€ millions (non-IFRS) | Currency | Currency | Currency | Currency | Currency | |||||
Services | 3,927 | 3,940 | 3,848 | 2 | 2 | |||||
Total segment revenue | 3,927 | 3,940 | 3,848 | 2 | 2 | |||||
Cost of cloud | -108 | -109 | -131 | -17 | -17 | |||||
Cost of software licenses and support | -49 | -49 | -49 | 0 | 0 | |||||
Cost of cloud and software | -158 | -159 | -180 | -12 | -12 | |||||
Cost of services | -2,850 | -2,864 | -2,814 | 1 | 2 | |||||
Total cost of revenue | -3,008 | -3,023 | -2,995 | 0 | 1 | |||||
Segment gross profit | 920 | 918 | 853 | 8 | 8 | |||||
Other segment expenses | -637 | -638 | -604 | 5 | 6 | |||||
Segment profit (loss) | 283 | 280 | 249 | 14 | 12 | |||||
The Core Services segment closed 2024 with an increase in segment services revenue by 2% (2% at constant currencies).
The segment cost of services slightly increased by 1% (2% at constant currencies) during 2024 and the other segment expenses increased by 5% (increased by 6% at constant currencies).
Overall, the Core Services segment profit rose 14% (12% at constant currencies) to €283 million in 2024 (2023: €249 million). This increase was primarily attributable to the positive cost development of SAP’s consulting and premium engagement business.
Financial Income, Net
In 2024, financial income, net, improved to €398 million (2023: –€456 million). Our finance income was €1,429 million (2023: €857 million) and our finance costs were €1,031 million (2023: €1,313 million).
Finance income primarily consists of interest income on investments in the amount of €631 million (2023: €486 million), of gains from IFRS 9-related fair value adjustments, mainly of Sapphire Ventures investments, and of the disposal of equity securities totaling €779 million (2023: €380 million).
Finance costs mainly consist of interest expense on financial liabilities and from derivative instruments amounting to €545 million (2023: €639 million), and of IFRS 9-related fair value adjustments or losses from disposal of Sapphire Ventures investments totaling €316 million (2023: €525 million). For more information about financing instruments, see the Notes to the Consolidated Financial Statements, Note (D.1) and Note (E.3).
Income Taxes
The effective tax rate in 2024 was 33.9% (2023: 32.6%). The year-over-year increase mainly resulted from a temporary inability to offset withholding taxes in Germany due to tax losses in 2024 resulting from restructuring. This effect was partly compensated by changes in tax exempt income. For more information about income taxes, see the Notes to the Consolidated Financial Statements, Note (C.5).
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Foreign Currency Exchange Rate Exposure
Generally, the Group’s entities conduct their operating business in their own functional currencies. However, occasionally the Group’s entities generate foreign currency-denominated receivables, payables, and other monetary items by transacting in a currency other than the respective functional currency. To mitigate the extent of the associated foreign currency exchange rate risk, a significant portion of these transactions is hedged with the primary aim to reduce profit or loss volatility. As our reporting currency is Euro, the consolidation of financial statements of subsidiaries with a functional currency other than Euro exposes us to foreign currency risk from the translation of the net assets of those subsidiaries. In general, translation risk is not hedged. However, in rare occasions we safeguard the Euro countervalue of merger or disposal activities. For more information about foreign currencies and our hedging activities, see Note (F.1) and Note (IN.1).
Our financial reporting remains subject to translation effects arising from our non-euro transactions. Approximately 67% of our total revenue in 2025 (2024: 67%) was attributable to non-euro denominated transactions. We translated that revenue into euros for financial reporting purposes. Fluctuations in the exchange value of the euro had an unfavorable impact of €1,004 million our total revenue for 2025, a unfavorable impact of €135 million on our total revenue for 2024.
The impact of foreign currency exchange rate fluctuations discussed in the preceding paragraph is calculated by translating current period figures in local currency to euros at the monthly average exchange rate for the corresponding month in the prior year. Our revenue analysis, included within the “Operating Results” section of Item 5, discusses at times the effect of currency movements which are calculated in the same manner.
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Liquidity and Capital Resources
Finances (IFRS)
Overview
Global Financial Management
We use global centralized financial management to control liquid assets and monitor exposure to foreign exchange, interest rate, credit, and equity risk. The primary aim of our financial management is to maintain liquidity in the Group at a level that is adequate to always meet our financial obligations. The Treasury Department manages liquidity of most SAP entities centrally, for example by pooling excess cash, to optimize deployment of liquid assets across the SAP Group in accordance with our policies. This central approach ensures sufficient levels of liquid assets to keep SAP financially flexible. In addition, various committed and uncommitted credit facilities are available for additional liquidity, if required. For more information about these facilities, see the Credit Facilities section.
We manage liquidity, foreign exchange, interest rate, credit, and equity price risks on a Group-wide basis. We use selected derivatives exclusively for this purpose and not for speculation, which is defined as entering into a derivative instrument for which we do not have corresponding underlying transactions. The rules for the use of derivatives and other rules and processes concerning the management of financial risks are documented in our Treasury Guideline, which applies globally to all companies in the Group. For more information about the management of each financial risk and about our risk exposure, see the Notes to the Consolidated Financial Statements, Note (F.1) and Note (F.2).
Capital Structure Management
The primary objective of our capital structure management is to maintain a strong financial profile for investor, creditor, and customer confidence, and to support the growth of our business. We seek to maintain a capital structure that will enable us to cover our funding requirements through the capital markets at reasonable conditions, and in so doing, ensure a high level of financial flexibility. For more information about the capital structure and its analysis, see the Notes to the Consolidated Financial Statements, Note (E.1).
The long-term credit ratings for SAP SE are “A+” by S&P Global Ratings (stable outlook) and “A1” by Moody’s (stable outlook).
In May 2023, SAP announced a share repurchase program with an aggregate volume of up to €5 billion, which was completed on August 13, 2025. SAP had repurchased 26,010,591 shares at an average price of €188.24, resulting in a purchased volume of approximately €4.9 billion under the program.
On January 29, 2026, SAP announced a new share repurchase program with an aggregate volume of up to €10 billion which is expected to be completed by the end of 2027.
Liquidity Management
Our primary source of cash, cash equivalents, and current investments are funds generated from our business operations. Over the past several years, our principal use of cash has been to support operations and our capital expenditure requirements resulting from our growth, to quickly repay financial debt, to acquire businesses and investments in venture activities, to pay dividends on our shares, and to buy back SAP shares on the open market. On December 31, 2025, our cash, cash equivalents, and current investments were primarily denominated in euros and U.S. dollars. We generally invest only in the financial assets of issuers or funds with a minimum credit rating of BBB and pursue a policy of cautious investment characterized by wide portfolio diversification with a variety of counterparties, predominantly short-term investments, and standard investment instruments such as bank term deposits or money market funds. Our investments in financial assets of issuers with a credit rating lower than BBB were not material in 2025.
We believe that our liquid assets and expected cash flow from operations, combined with our undrawn credit facilities, are sufficient to meet our operating financing needs, capital expenditure, debt repayments, and capital returns to our shareholders in 2026. It may also be necessary to enter into financing transactions should additional funds be required to maintain flexibility.
Therefore, we continuously monitor funding options available in the capital markets and trends in the availability of funds, as well as the cost of such funding. In recent years, we were able to repay additional debt within a short period of time due to our persistently strong free cash flow. For more information about our financial debt, see the Financial Debt section.
See Note (D.6) and Note (D.8) for our capital contribution commitments and purchase obligations respectively and Note (F.1) for lease and other financial liabilities.
As of December 31, 2025, €292 million of our other non-current non-financial liabilities have a maturity between 1 and 5 years and €231 million have a maturity of more than 5 years. €163 million of our derivative financial liabilities have a maturity of less than 1 year and €310 million have a maturity between 1 and 5 years. €40 million of our derivative financial liabilities have a maturity of more than 5 years.
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As of December 31, 2024, €414 million of our other non-current non-financial liabilities have a maturity between 1 and 5 years and €335 million have a maturity of more than 5 years. €286 million of our derivative financial liabilities have a maturity of less than 1 year and €339 million have a maturity between 1 and 5 years. €69 million of our derivative financial liabilities have a maturity of more than 5 years.
The timing of payments for the contractual obligations is based on payment schedules for those obligations where set payments exist. For other obligations with no set payment schedules, estimates for the most likely timing of cash payments have been made. The ultimate timing of these future cash flows may differ from these estimates. We do not believe we have forms of material off-balance sheet arrangements that would require disclosure other than those already disclosed.
Financial Debt
Financial debt is defined as the nominal volume of bank loans, commercial paper, private placements, and bonds.
The nominal volume of financial debt on December 31, 2025, included amounts in euros (€6,150 million). On December 31, 2025, approximately 74% of the financial debt was held at variable interest rates, partially swapped from fixed into variable using interest rate swaps.
Financial Debt by Instrument
For more information about our financial debt, see the Notes to the Consolidated Financial Statements, Note (E.3).
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Liquidity
Group Liquidity and Net Liquidity/Net Debt
€ millions | | 2025 | | 2024 | | ∆ |
Cash and cash equivalents |
| 8,220 |
| 9,609 |
| –1,390 |
Current time deposits and debt securities |
| 1,311 |
| 1,471 |
| –160 |
Group liquidity |
| 9,531 |
| 11,080 |
| –1,550 |
Current financial debt |
| –1,600 |
| –3,639 |
| 2,039 |
Non-current financial debt |
| –4,550 |
| –5,746 |
| 1,196 |
Financial debt |
| –6,150 |
| –9,385 |
| 3,235 |
Net liquidity (+)/net debt (–) |
| 3,381 |
| 1,695 |
| 1,685 |
Lease liabilities | –1,684 | –1,715 | 31 | |||
Net liquidity/net debt including lease liabilities | 1,697 | –19 | 1,716 |
Group liquidity consists of cash and cash equivalents (for example, cash at banks, money market funds, and time deposits with original maturities of three months or less) and current investments (for example, time deposits and debt securities with original maturities of greater than three months, and remaining maturities of less than one year included in current other financial assets). Group liquidity on December 31, 2025, primarily comprised amounts in euros and U.S. dollars.
The net decrease in group liquidity compared to 2024 is mainly due to repayments of borrowings, and the effects of foreign currency exchange rates on cash and cash equivalents, which were partially offset by a higher operating cashflow.
Net liquidity/net debt is group liquidity less financial debt. For more information about our liquidity, see the Notes to the Consolidated Financial Statements, Note (E.3).
Development of Net Debt
€ millions |
| 2025 |
| 2024 | ||
Net liquidity (+)/net debt (–) 12/31/2024 (PY: 12/31/2023) | Free Cash Flow | 1,695 | 3,521 | |||
Net cash flows from operating activities | 9,156 | 5,207 | ||||
Capital expenditure | 8,239 | -739 | -797 | |||
Proceeds from sales | 121 | 122 | ||||
Lease payments |
| -299 |
| -310 | ||
Business combinations |
| -702 |
| -1,114 | ||
Dividends |
| -2,743 |
| -2,565 | ||
Treasury shares |
| -1,937 |
| -2,106 | ||
Interest payments, net | -154 | 13 | ||||
Other |
| -1,018 |
| -277 | ||
Net liquidity (+)/net debt (–) 12/31/2025 (PY: 12/31/2024) |
| 3,381 |
| 1,695 |
Analysis of Consolidated Statements of Cash Flows
€ millions | Years ended December 31, | ∆ in % | ∆ in % | |||||||
| 2025 | | 2024 | | 2023 | | 2025 vs. 2024 | | 2024 vs. 2023 | |
Net cash flows from operating activities |
| 9,156 |
| 5,207 |
| 6,134 |
| 76 |
| -15 |
Net cash flows from investing activities |
| -965 |
| -93 |
| -4,134 |
| >100 |
| -98 |
Net cash flows from financing activities |
| -8,745 |
| -3,961 |
| -8,151 |
| >100 |
| -51 |
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Analysis of Consolidated Statements of Cash Flows: 2025 compared to 2024
In 2025, cash inflows from operating activities increased €3,949 million to €9,156 million (2024: €5,207 million). This is particularly due to higher profitability, driven by continued revenue growth and improved collection effectiveness. In addition, lower restructuring payments (€0.8 billion in 2025 compared to €2.5 billion in 2024), lower share-based payments (€0.8 billion in 2025 compared to €1.3 billion in 2024), and slightly lower income taxes paid (€2.2 billion in 2025 compared to €2.3 billion in 2024) contributed to the cash flows from operating activities. Prepaid expenses and advance payments increased €0.6 billion in 2025. For more information see the Notes to the Consolidated Financial Statements, Note (A.2) for trade receivables, Note (B.3) for share-based payments, Note (B.6) for restructuring, Note (C.5) for income taxes, and Note (G.1) for prepaid expenses and advance payments. In Note G.1, we provide further information about the prepayments to hyperscalers.
Cash outflows from investing activities totaled €965 million in 2025, compared to €93 million in 2024. We decreased our short-term time deposits and debt instruments by €0.2 billion in 2025 (2024: decreased by €1.7 billion). We paid €0.7 billion, net of cash received, in 2025, chiefly to acquire SmartRecruiters, compared to €1.1 billion in 2024, which was mainly used for the acquisition of WalkMe. Capital expenditure on intangible assets and property, plant, and equipment slightly decreased to €0.7 billion (€0.8 billion in 2024).
In 2025, free cash flow (for the definition, see the Performance Management System section) increased to €8,239 million (2024: €4,222 million). Since December 2024, our forecasted exposure hedging strategy has been aimed at reducing volatility from foreign currency fluctuations on the forecasted Free Cash Flow (FCF) of a calendar year. For more information, see the Notes to the Consolidated Financial Statements, Note (F.1).
Net cash outflows from financing activities were €8,745 million in 2025, compared to €3,961 million in 2024. In September 2024, SAP secured a short-term loan of €1.25 billion to finance the WalkMe acquisition, with flexible repayment terms through September 2025, which was paid back in March 2025. Further, in December 2025, we repaid a total of €1 billion raised in 2024 via bilateral credit lines and repaid early US$0.1 billion in U.S. private placements. Additionally, we repurchased shares with a volume of €1.9 billion in 2025 as part of our share buyback program. Apart from the buyback of shares, cash outflows in 2025 resulted from the repayment of €0.6 billion in Eurobonds, and US$0.3 billion in U.S. bonds upon maturity. In 2024, we repurchased shares worth €2.1 billion as part of the share buyback program. Further cash outflows in 2024 resulted from the repayment of €0.85 billion in Eurobonds, and US$0.32 billion in U.S. private placements upon maturity.
In 2025, we distributed €2,743 million in dividends, compared to €2,565 million in 2024.
Analysis of Consolidated Statements of Cash Flows: 2024 Compared to 2023
In 2024, cash inflows from operating activities decreased €927 million to €5,207 million (2023: €6,134 million). This is particularly due to significantly higher restructuring payouts (€2.5 billion in 2024 compared to €0.2 billion in 2023), increased share-based payments (€1.3 billion in 2024 compared to €1.1 billion in 2023), and higher income tax payments of €2.3 billion in 2024 (€2.2 billion in 2023). Prepayments to suppliers and to the tax authorities increased €0.3 billion in 2024. Cash collected from customer contracts increased in 2024, driven by continued revenue growth, improved collection effectiveness, and approximately €0.2 billion in customer payments before the due date in late December. In 2024, we discontinued the SAP-triggered financing (2023: €0.2 billion).
Cash outflows from investing activities totaled €93 million in 2024, compared to €4,134 million in 2023. We decreased our short-term time deposits and debt instruments by €1.7 billion in 2024 (2023: increased by €2.5 billion). We paid €1.1 billion, net of cash received, in 2024, chiefly to acquire WalkMe, compared to €1.2 billion in 2023, which was mainly used for the acquisition of LeanIX. Capital expenditure on intangible assets and property, plant, and equipment remained at €0.8 billion (€0.8 billion in 2023).
In 2024, free cash flow (for the definition, see the Performance Management System section) decreased to €4,222 million (2023: €5,116 million). The free cash flow conversion rate, defined as free cash flow as a percentage of profit after tax, decreased to 134% (2023: 142%). Since December 2024, our forecasted exposure hedging strategy is aimed at reducing volatility from foreign currency fluctuations on the forecasted Free Cash Flow (FCF) of a calendar year.
Net cash outflows from financing activities were €3,961 million in 2024, compared to €8,151 million in 2023. In September 2024, SAP secured a short-term loan of €1.25 billion to finance the WalkMe acquisition, with flexible repayment terms through September 2025. In December 2024, SAP raised a total of €1 billion via bilateral credit lines with a term of one year as well as €0.5 billion via two commercial paper tranches of €0.25 billion each. Additionally, we repurchased shares with a volume of €2.1 billion in 2024 as part of our share buyback program. Apart from the buyback of shares, cash outflows in 2024 resulted from the repayment of €0.85 billion in Eurobonds, and US$0.32 billion in U.S. private placements upon maturity. In 2023, we repurchased shares worth €0.95 billion as part of the share buyback program. Further cash outflows in 2023 resulted from the repayment of €1.6 billion in Eurobonds, €1.45 billion in loans, and €0.93 billion in commercial paper upon maturity.
In 2024, we distributed €2,565 million in dividends, compared to €2,395 million in the previous year.
Credit Facilities
Other sources of liquidity are available to us through various credit facilities, if required.
To retain high financial flexibility, SAP SE entered into a committed €3 billion syndicated revolving credit facility on March 8, 2023, with an initial term of five years plus two one-year extension options. The initial term of this facility was extended by two years until March 2030. A possible future utilization is not subject to any financial covenants. So far, we have not used, and do not currently foresee any need to use, this credit facility.
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As at December 31, 2025, SAP SE had additional bilateral uncommitted credit facilities available totaling €1.15 billion which are currently not utilized. Several other SAP entities have credit facilities available that allow them to borrow funds at prevailing interest rates.
Obligations under Indemnifications and Guarantees
Our software license agreements and our cloud subscription agreements generally include certain provisions for indemnifying customers against liabilities if our software products infringe a third party’s intellectual property rights. In addition, we occasionally provide function or performance guarantees in routine consulting contracts and development arrangements. We also generally provide a six to twelve-month warranty on our software and a subscription-length warranty on cloud services with a 90 day claim cut off. Our warranty liability is included in other provisions. For more information on other provisions see Notes (A.4), (B.5), and (B.6) to our Consolidated Financial Statements. For more information on obligations and contingent liabilities refer to Notes (A.4), (D.6), (D.8) and (G.3) in our Consolidated Financial Statements.
Research and Development
For information on our R&D activities see “Item 4. Information about SAP — Our Investments in Innovation.” For information on our R&D costs see “Item 5. Operating and Financial Review and Prospects — Operating Results (IFRS)” and for information related to our R&D employees see “Item 6. Directors, Senior Management and Employees — Employees.”
New Accounting Standards Not Yet Adopted
See Note (IN.1) to our Consolidated Financial Statements for our discussion on new accounting standards not yet adopted.
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Expected Developments
Economic Outlook for 2026 and Beyond
Future Trends in the Global Economy
Until 2028, the global economy will grow at similar rates to 2025, projects the ECB in its most recent Economic Bulletin.1 This means that economic growth will be stronger than previously expected but remain below the pre-pandemic average. According to the ECB, this growth will probably continue to be services-led and subject to uncertainties about geopolitical tensions, global financial market sentiments, supply chain disruptions, and volatile international environments. Against this background, the ECB expects emerging market economies to grow relatively strongly, with India standing out in terms of robust economic activity and import growth.
As for the EMEA region, the ECB expects domestic demand in the euro area to remain the main economic driver throughout the projection horizon. Gains in real incomes and a resilient labor market could contribute positively to private consumption. On the other hand, additional public spending on infrastructure and defense, especially in Germany, higher profits, reduced uncertainty, and improved financing conditions might lead to expanding business investments. In addition, exports might also start picking up in 2026 due to a rebound in foreign demand and despite gradually unfolding impacts from higher tariffs.
Regarding the Americas region, the ECB finds that capital expenditures related to artificial intelligence and higher fiscal spending in the United States could strengthen domestic demand. It therefore presents a stronger growth outlook for the United States over the projection horizon.
In the APJ region, according to the ECB, economic growth in China will likewise be stronger than previously expected. On the one hand, this could be due to the recent United States-China trade agreement that reduces U.S. tariffs on Chinese imports. On the other hand, China’s new five-year plan puts emphasis on economic growth from 2026 onward, providing a large fiscal stimulus for stronger export dynamics. Activity in the Chinese services sector should continue to expand, but could soften. “In Japan, growth is projected to moderate from 1.1 percent in 2025 to 0.7 percent in 2026 and to 0.6 percent in 2027. This marks a small upward revision relative to the October figure, reflecting in part the fiscal stimulus package announced by the new government,”2 says the IMF.
Economic Trends – GDP Growth Year Over Year
Percent | | 2025 | | 2026p | | 2027p |
World |
| 3.3 |
| 3.3 |
| 3.2 |
Advanced Economies |
| 1.7 |
| 1.8 |
| 1.7 |
Emerging Markets and Developing Economies |
| 4.4 |
| 4.2 |
| 4.1 |
Regions (according to IMF taxonomy) | ||||||
Euro Area |
| 1.4 |
| 1.3 |
| 1.4 |
Germany |
| 0.2 |
| 1.1 |
| 1.5 |
Emerging and Developing Europe |
| 2.0 |
| 2.3 |
| 2.4 |
Middle East and Central Asia |
| 3.7 |
| 3.9 |
| 4.0 |
Sub-Saharan Africa |
| 4.4 |
| 4.6 |
| 4.6 |
United States |
| 2.1 |
| 2.4 |
| 2.0 |
Canada |
| 1.6 |
| 1.6 |
| 1.9 |
Latin America and the Caribbean |
| 2.4 |
| 2.2 |
| 2.7 |
Japan |
| 1.1 |
| 0.7 |
| 0.6 |
Emerging and Developing Asia |
| 5.4 |
| 5.0 |
| 4.8 |
China |
| 5.0 |
| 4.5 |
| 4.0 |
p = projection |
Source: International Monetary Fund (IMF), World Economic Outlook Update January 2026, Global Economy: Steady amid Divergent Forces
(https://www.imf.org/-/media/files/publications/weo/2026/january/english/text.pdf), p. 11.
1 European Central Bank, Economic Bulletin, Issue 8/2025, Publication Date: January 15, 2026.
2 International Monetary Fund (IMF), World Economic Outlook Update January 2026, Global Economy: Steady amid Divergent Forces (https://www.imf.org/-/media/files/publications/weo/2026/january/english/text.pdf), p. 4.
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The IT Market: Outlook for 2026 and Beyond
Looking ahead, the global IT market is expected to undergo sweeping changes driven by AI infrastructure modernization and outcome-based investment strategies. From compute-intensive cloud platforms to autonomous edge deployments, the next wave of IT growth will be defined by how well enterprises align technical investments with measurable business value.
Enterprise technology is entering a new phase of strategic transformation, with organizations now moving away from experimentation and toward measurable value realization in their AI investments. Industry analysts expect a major shift in enterprise AI strategy in the coming years on account of companies transitioning to scalable, value-driven deployments. As AI becomes foundational across functions, organizations are prioritizing platforms that can scale insights, automate workflows, and drive resilience.
One of the most significant forward-looking developments is the expected rise of enterprise agents. These are intelligent and autonomous software components that interpret complex business conditions and act independently. IDC predicts that, “by 2027, agentic automation will enhance capabilities in over 40% of enterprise applications.”1 Another IDC report notes that, “by 2027, G2000 agent use will jump 10x and token/call loads 1,000x, making agent vetting, orchestration, and optimization essential IT responsibilities.”2 This shift is expected to lay the foundation for next-generation AI operating models and transform a third of all business workflows. These agents, embedded within core ERP, supply chain, and finance systems, will go beyond automation to deliver adaptive, context-aware execution at scale.
From a platform perspective, the cloud continues to serve as the enabling foundation for this evolution. According to IDC, “ ‘As AI rapidly reshapes technology, cloud is evolving from a foundational utility to an intelligent, self-managing ecosystem,’ said Dave McCarthy, research vice president, Cloud and Edge Services at IDC. ‘The convergence of AI and cloud will give rise to agentic platforms that autonomously manage everything from workload placement to security, enabling a new level of efficiency and strategic value.’ ”3 IDC further predicts that, “By the end of this decade, the enterprise technology landscape will look radically different. The AI agent will become a new enterprise stock keeping unit (SKU), meaning a standardized, individually deployable and purchasable software capability purchased via marketplaces and powered by modular backend capabilities rather than monolithic SaaS platforms. User interfaces will still be critical to productivity but so will orchestration of more-or-less autonomous workflows. SaaS is not dead, but it is metamorphosing. The software industry is entering a new chapter defined by AI, automation, and outcome-based economics.”4
At the same time, geopolitical tensions and increasing regulatory fragmentation are driving growing demand for sovereign cloud solutions, as enterprises and public sector organizations seek to ensure data residency, compliance, and operational control while continuing to benefit from cloud-based innovation. These requirements are increasingly shaping customer cloud decisions and deployment models, particularly in regulated and public sector environments, making sovereign cloud capabilities a necessary component of enterprise cloud strategies rather than a niche consideration.
AI economics is becoming a critical framework for evaluating enterprise technology investments. IDC believes that “2026 will be the year that all enterprises shift from initiating their artificial intelligence (AI) pivot and start to make investments in more advanced agentic AI systems; in more modern cloud, data, and connectivity solutions; and in strategies to ensure effective human and digital cooperation. The end goal is to improve the organization's resiliency, reaction time, and ability to expand through innovation, becoming a resilient AI-fueled business by 2030. The investments and actions of IT industry providers — large and small, old and new — will play a large role in determining whether enterprises are able to achieve full AI alignment, making infusion of AI into business and IT processes a repeatable and well-managed enterprise capability.”2 This shift is driving demand for robust value realization practices to ensure technology initiatives deliver tangible ROI.
Looking ahead, the global IT market is expected to be defined not only by growth in AI spending, which is forecasted to outpace overall tech investment, but also by how effectively organizations embed AI into business processes and restructure themselves around it. This next chapter of enterprise transformation will be led by companies that can operationalize AI, modernize core systems, and build the digital architecture for long-term competitive advantage.
Impact on SAP
Uncertainty is expected to remain a defining feature of the global business environment in 2026. Ongoing geopolitical tensions, shifts in trade policy, and the accelerating pace of AI and infrastructure innovation remain key challenges that may weigh on customer buying decisions going forward. Navigating external volatility will require companies to stay agile, resilient, and focused on execution.
The IT outlook suggests that enterprises will continue to prioritize platform consolidation, integrated data strategies, and AI readiness. Customers are expected to shift from fragmented experimentation toward more outcome-driven deployments, favoring solutions that can scale across the business. Against this backdrop, SAP will continue to position itself as a strategic partner for customers seeking to modernize their core systems, simplify their technology stack, and prepare for future disruption.
Concerns that enterprise software providers could struggle to translate AI innovation into scalable SaaS value are mitigated in SAP’s case by its ability to embed AI directly into mission-critical business processes, supported by deep business data and an integrated application landscape, as emphasized in management commentary during the year.
1 IDC FutureScape: Worldwide AI-Enabled Enterprise Applications and Agents 2026 Predictions, October 2025, IDC #US53855925.
2 IDC FutureScape: Worldwide IT Industry 2026 Predictions, October 2025, IDC #US53858725.
3 IDC FutureScape: Worldwide Cloud 2026 Predictions, October 2025, IDC #US53859425.
4 IDC Blog, Is SaaS Dead? Rethinking the Future of Software in the Age of AI, December 2025.
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The Company enters 2026 with a strong share of more predictable revenue and clear focus on product innovation, operational discipline, and customer success. These foundations will support SAP’s long-term strategy and help drive continued momentum across its differentiated portfolio. Customer requirements for compliant, sovereign cloud deployments continue to expand, particularly in regulated industries and the public sector. SAP’s sovereign cloud strategy enables the Company to address these needs while continuing to deliver cloud-based innovation, reinforcing sovereign cloud as a growth opportunity rather than a constraint.
Financial Targets and Prospects
Outlook for 2026
Unless otherwise stated, all forward-looking statements, except free cash flow and effective tax rate, are at constant currencies. The results for 2025, except growth rates, are presented at actual currencies. For more information about our performance measures, see the Performance Management System section.
Strategic Objective | | KPI | | Results for 2025 | | Outlook for 2026 |
| Cloud revenue |
| €21.02 billion |
| €25.8 billion to €26.2 billion | |
Growth |
| Cloud and software revenue |
| €32.54 billion |
| €36.3 billion to €36.8 billion |
| Total revenue growth |
| 11% | To accelerate through 2027 | ||
| Current cloud backlog growth |
| 25% | To slightly decelerate | ||
Profitability |
| Operating profit (non-IFRS) |
| €10.42 billion | €11.9 billion to €12.3 billion | |
| Free cash flow1 |
| €8.24 billion | Approximately €10 billion | ||
Customer satisfaction |
| Cloud CSAT2 |
| 75% | 75% to 76% | |
Working environment |
| Business Health Culture Index |
| 81% | 80% to 82% | |
Employee engagement |
| Employee Engagement Index |
| 76% | 74% to 78% | |
Climate performance |
| Gross greenhouse gas emissions3 |
| 3.6 Mt |
| To steadily decrease carbon emissions across the relevant value chain |
1 at actual currencies
2 From 2026, SAP is adopting Cloud CSAT as its new customer experience KPI. For more information, see the Performance Management System section.
3 In 2026, we will update the calculation methodology for Gross greenhouse gas emissions, which will result in a significant decrease in reported emissions and therefore lead to a rebaselining according to the Greenhouse Gas (GHG)-Protocol. The presented number of 3.6 Mt is already based on the updated calculation methodology. For more information, see the Performance Management System section.
Furthermore, SAP provides the following additional forward-looking information for selected metrics:
| - | An effective tax rate (non-IFRS) of approximately 29% (2025: 30.5%).15 |
| - | A slight increase in segment revenue (2025: €3.95 billion) and a moderate decrease in segment profit (2025: €0.43 billion) for the Core Services segment. This reflects SAP’s strategy for the Core Services segment to help customers adopt and consume innovation, maximize the benefits of the cloud, and realize the value of SAP Business Suite. |
Beyond the outlook for 2026, SAP expects:
| - | Total revenue growth to accelerate through 2027, driven by growth in cloud revenue and primarily Cloud ERP Suite. |
| - | Total operating expenses to grow at 80% to 90% of total revenue growth in 2027, supported by slightly declining sales and marketing, research and development, and general and administration expense ratios. These improvements include efficiency gains from the internal deployment of SAP’s AI solutions. |
| - | Software support revenue to decline at a faster rate in the coming years as customers increasingly shift to the cloud. |
Further, we aim to reduce our gross greenhouse gas (GHG) emissions by at least 90% across our relevant value chains by 2030 as part of our net-zero commitment. Our Net Zero 2030 target is dependent on the following elements, which are outside of SAP’s direct control: Progress and success of the decarbonization efforts of our suppliers; and changes in regulations, such as the revision of the SBTi standards, expected to be finalized in 2026; Due to the rapid development in the AI and general cloud infrastructure area and the resulting high energy needs it is unclear if this demand can be fully covered with renewable energy. Due to these uncertainties, we are monitoring our progress in achieving the net zero target by 2030 and are continuously evaluating whether adjustments might be necessary.
15 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 effort but could have a significant impact on our future effective tax rate (IFRS).
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Assumptions for Constant Currencies and Non-IFRS Financial Measures
SAP’s full-year 2026 business outlook, except free cashflow and effective tax rate, is at constant currencies. Where numbers are presented in actual currencies, these are likely to be affected by exchange rate fluctuations as the year progresses. See the table below for the expected currency impacts for the full year 2026. These expectations are based on the December 2025 level.
In percentage points (pp) | | FY 2026 |
Cloud revenue growth | –3.0pp | |
Cloud and software revenue growth | –2.5pp | |
Operating profit growth (non-IFRS) | –3.5pp |
This includes an exchange rate of US$1.18 per euro.
The following table shows the estimates of the items that represent the differences between our non-IFRS financial measures and our IFRS financial measures for operating profit.
€ millions | Estimated | Actual | ||
| Amounts for |
| Amounts for | |
| 2026 | | 2025 | |
Acquisition-related charges |
| 340–420 |
| 411 |
Restructuring |
| 0–20 |
| 3 |
Regulatory compliance matters |
| 0 |
| 0 |
Teradata litigation |
| 0 |
| 387 |
The differences between free cash flow as our non-IFRS financial measure and operating cash flow as our IFRS financial measure include estimated cash flows in 2026 for expenditures and proceeds from the sale of intangible assets and property, plant, and equipment, and expenditures for leasing of approximately –€1.1 billion (2025: –€0.9 billion).
Proposed Dividend
In 2026, we intend to pay a dividend of €2.50 per share (subject to shareholder approval at the Annual General Meeting of Shareholders in May 2026).
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ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
Supervisory Board
The current members of the Supervisory Board of SAP SE, each member’s principal occupation, the year in which each was first elected and the year in which the term of each expires, respectively, are as follows:
Name | | Age | | Principal Occupation | | Year First | | Year Term |
Dr. h. c. mult. Pekka Ala-Pietilä, Chairperson1,4, 8, 9 | 69 | Chairman of the Supervisory Board SAP SE Chairperson of the Board of Directors of Sanoma Corporation | 2024 | 2026 | ||||
Lars Lamadé, Deputy Chairperson2, 4, 9 | 54 | Employee, Head of Global Sponsorships | 2002 | 2029 | ||||
Jakub Cerny2, 5, 6 | 43 | Employee, Demand Manager | 2024 | 2029 | ||||
Pascal Demat2, 6, 9 | 58 | Employee, Solution Advisor HCM, Member of SAP SE Works Council (Europe) | 2024 | 2029 | ||||
Marielle Ehrmann3,6,7 | 43 | Employee, Chief Security Compliance & Risk Officer | 2026 | 2029 | ||||
Aicha Evans1, 4, 7, 8 | 57 | Chief Executive Officer and Member of the Board of Directors, Zoox, Inc. | 2017 | 2028 | ||||
Andreas Hahn2, 4, 7 | 55 | Employee, Product Expert Digital Supply Chain Standards, Chairperson of SAP SE Works Council (Europe) | 2024 | 2029 | ||||
Prof. Dr. Ralf Herbrich1, 6, 7 | 51 | Professor for Artificial intelligence and sustainability, Hasso Plattner Institute for Digital Engineering gGmbH | 2024 | 2028 | ||||
Margret Klein-Magar2, 4, 5 | 61 | Employee, Vice President, Head of SAP Alumni Relations | 2012 | 2025 | ||||
Jennifer Xin-Zhe Li1, 5, 6, 10 | 58 | General Partner, Changcheng Investment Partners | 2022 | 2027 | ||||
Dr. Qi Lu1, 7 | 64 | CEO, MiraclePlus | 2020 | 2027 | ||||
César Martin2, 5, 7 | 53 | Employee, SAP EMEA Enterprise Architect, Chairperson of the SAP Spain Works Council | 2024 | 2029 | ||||
Gerhard Oswald1, 5, 7, 9 | 72 | Managing Director of Oswald Consulting GmbH | 2019 | 2026 | ||||
Dr. Friederike Rotsch1, 4, 5, 8, 9 | 53 | Attorney-at-law | 2018 | 2028 | ||||
Nicolas Sabatier2, 4, 7 | 65 | Member of the Confédération Française de l’Encadrement – Confédération Générale des Cadres (CFE-CGC union, Paris, France) | 2024 | 2029 | ||||
Dr. Eberhard Schick2, 5, 6 | 58 | Employee, Chairperson of SAP SE Works Council | 2024 | 2029 | ||||
Nina Strassner2, 5, 6, 9 | 44 | Employee, Head of People Transformation Management BTM | 2024 | 2029 | ||||
Dr. Rouven Westphal1, 4, 6, 8 | 53 | Member of the Executive Board of the Hasso Plattner Foundation and Managing Director of the General Partner of HPC Germany GmbH & Co. KG | 2021 | 2026 | ||||
Dr. Gunnar Wiedenfels1, 5, 6, 10 | 48 | Chief Financial Officer, Warner Bros. Discovery Inc. | 2019 | 2026 |
1 Elected by SAP SE’s shareholders on May 15, 2024.
2 Appointed by the SAP SE Works Council Europe on April 25, 2024.
3 Appointed by the SAP SE Works Council Europe on November 19, 2025.
4 Member of the Personnel and Governance Committee.
5 Member of the Audit and Compliance Committee.
6 Member of the Finance and Investment Committee.
7 Member of the Product and Technology Committee.
8 Member of the Nomination Committee.
9 Member of the Government Security Committee.
10 Audit Committee financial experts.
For detailed information on the Supervisory Board committees and their tasks, including the Audit and Compliance Committee and the Personnel and Governance Committee, please refer to “Item 10 Additional Information — Corporate Governance.”
Pursuant to the Articles of Incorporation of SAP SE and the Agreement on the Involvement of Employees in SAP SE, members of the Supervisory Board of SAP SE consist of nine representatives of the shareholders and nine representatives of the European employees.
Certain current members of the Supervisory Board of SAP SE were members of supervisory boards and comparable governing bodies of enterprises other than SAP SE in Germany and other countries as of December 31, 2025. See Note (G.4) to our Consolidated Financial Statements for more detail. Apart from pension obligations for employees, SAP SE has not entered into contracts with any member of the Supervisory Board that provide for benefits upon a termination of the employment or service of the member.
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Executive Board
The current members of the Executive Board, the year in which each member was first appointed and the year in which the term of each expires, respectively, are as follows:
Name | | Year First | | Year Current |
Christian Klein, CEO | 2018 | 2030 | ||
Muhammad Alam | 2024 | 2027 | ||
Dominik Asam | 2023 | 2028 | ||
Thomas Saueressig | 2019 | 2028 | ||
Sebastian Steinhaeuser | 2025 | 2028 | ||
Gina Vargiu-Breuer | 2024 | 2027 |
A description of the management responsibilities and backgrounds of the current members of the Executive Board are as follows:
Christian Klein, CEO (Vorstandsvorsitzender), 45 years old, holds a diploma in international business administration from the University of Cooperative Education in Mannheim, Germany. He joined SAP in 1999 and became a member of the Executive Board in 2018. On October 10, 2019 he became co-CEO alongside Jennifer Morgan and on April 20, 2020 he was appointed sole CEO. Christian holds the overall responsibility for the corporate strategic direction, management, and performance of SAP.
Muhammad Alam, 48 years old, holds a bachelor’s degree from Morehouse College, Atlanta, Georgia. He joined SAP in 2022 as president and chief product officer of the Intelligent Spend Management program and became a member of the Executive Board in April 2024. Muhammad leads the board area SAP Product & Engineering and has global responsibility for all business software applications. Before joining SAP, he spent 17 years at Microsoft, leading various teams in the Business Applications division.
Dominik Asam, 56 years old, graduated in mechanical engineering at Technical University of Munich and École Centrale Paris. He also holds a master’s degree in business administration from INSEAD (European Institute of Business Administration). He joined SAP in March 2023 as Chief Financial Officer (CFO) and member of the Executive Board. He is responsible for global finance and administration including legal, investor relations, internal audit, data protection and export control as well as government affairs. Prior to joining SAP, Dominik had served as CFO at Airbus SE from April 2019 to February 2023 and Infineon Technologies AG from 2011.
Thomas Saueressig, 40 years old, holds a degree in Business Information Technology from the University of Cooperative Education in Mannheim, Germany, and a joint executive MBA from ESSEC, France, and Mannheim Business School, Germany. He joined SAP in 2004 and became a member of the Executive Board in 2019. Thomas leads the Board area customer services & delivery and has global responsibility for long-term customer value in the cloud including customer services, premium engagements, customer innovation services and customer support. He is also responsible for cloud infrastructure, cloud operations, cloud lifecycle management, and private cloud delivery.
Sebastian Steinhaeuser, 40 years old, holds a degree in Business Administration from the European Business School in Oestrich - Winkel, Germany and an MBA from Stanford University. He first joined SAP in 2020 and became a member of the Executive Board in 2025. Sebastian is Chief Operating Officer (COO) and has global responsibility for the Strategy & Operations board area, including corporate strategy, operations, global marketing and partner management.
Gina Vargiu-Breuer, 51 years old, holds a postgraduate diploma in advanced management from ESMT Berlin and a master degree in economic psychology from the Catholic University of Eichstätt-Ingolstadt. She joined SAP in February 2024 as member of the Executive Board. Gina is Chief People Officer with global responsibility for the people & culture organization. She also serves as Labor Director. Before joining SAP, Gina was Senior Vice President Global Human Resources at Siemens Energy.
The members of the Executive Board of SAP SE as of December 31, 2025 that are members on other supervisory boards and comparable governing bodies of enterprises, other than SAP, in Germany and other countries, are set forth in Note (G.4) to our Consolidated Financial Statements. SAP SE has not entered into contracts with any member of the Executive Board that provide for benefits upon a termination of the employment of service of the member, apart from pensions, benefits payable in the event of an early termination of service, and abstention compensation for the postcontractual noncompete period.
To our knowledge, there are no family relationships among any of the Supervisory Board and Executive Board members.
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Compensation Report
Compensation for Executive and Supervisory Board Members
This compensation report describes the two compensation systems for Executive and Supervisory Board members, outlines the criteria that apply to the compensation for the year 2025, and discloses the amount of compensation. The compensation system for the Executive Board members was approved by the Annual General Meeting on May 11, 2023, and the compensation system for the Supervisory Board members was approved by the Annual General Meeting on May 15, 2024.
The current compensation report meets the requirements of section 162 of the German Stock Corporation Act (AktG). The compensation report for 2024 was approved by the Annual General Meeting on May 13, 2025.
Compensation for Executive Board Members
Compensation System
The compensation for Executive Board members is intended to reflect the demanding responsibilities of Executive Board members leading a global company in a rapidly evolving sector. The compensation level is aimed to be competitive to support SAP in the global market for highly skilled executives, especially in the context of the international software industry. It is our goal that our Executive Board compensation provides sustainable incentive for committed, successful work in a dynamic business environment.
We have retained the proven basic structure of the compensation system and its regular compensation components. Total compensation under this system can be broken down into the individual compensation components as shown below.
Building on this structure, the compensation system seeks to ensure that compensation:
| – | Promotes the business strategy |
| – | Ensures that extraordinary performance is appropriately rewarded and any failure to achieve specific targets triggers a tangible reduction in the compensation |
| – | Is in line with market standards in terms of its level and structure and reflects the Company’s size, complexity, and economic situation |
| – | Takes account of the pay structure in the Company as a whole. In this context, the compensation is compared with the pay of SAP executives and non-executive SAP employees to ensure that the principle of proportionality is observed within SAP. |
The main aspects of the compensation system are:
– | To emphasize the long-term performance of the Company, the ratio between short-term and long-term performance-based compensation is 40:60. |
– | Long-term performance-based compensation is fully performance-based and incorporates important environmental, social, and governance (ESG) targets. |
– | The system provides an option to grant like-for-like replacement awards to compensate for benefits from previous employment that an Executive Board member forfeited on joining SAP’s Executive Board, and an option to grant virtual shares with different terms. |
– | It incorporates share ownership guidelines and a mobility package, and provides for partly deferred payment of short-term performance-based compensation by converting the payout amount into virtual shares. |
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Application of the Compensation System
The Supervisory Board – supported by its Personnel and Governance Committee – ensures that the compensation agreements and the individual target total compensation for each Executive Board member are aligned with the compensation system.
The Supervisory Board sets the target total compensation for each Executive Board member based on their individual role and performance. This target total compensation is aligned with SAP’s global strategy, market position, business performance, the economic outlook, and the compensation paid at comparable national and international companies. The annual benchmarking is based on the compensation data from the DAX 40 companies as well as selected U.S.-based IT and other technology companies.16 The benchmark was the basis for all compensation decisions made in 2025. The Supervisory Board reviews, assesses, and sets the target total compensation in its first meeting of each fiscal year (February 19, 2025, for 2025). The Supervisory Board is of the opinion that this approach ensures that the compensation is appropriate.
The amount of performance-based compensation depends on the performance of SAP’s KPIs (key performance indicators) against predefined target values and on SAP’s share price, and is subject to hurdles and caps. To ensure unified leadership direction and strategic alignment, the Executive Board members work towards the same overall targets. The KPIs, their target values, and their weighting are reviewed and set by the Supervisory Board each year and are aligned to the SAP budget for that year or to SAP’s externally communicated financial ambitions. For changes to the KPIs, see the Decisions for 2025 section.
The individual elements of SAP’s Executive Board compensation are described in more detail below.
Non-Performance-Based Compensation
Annual Base Salary
The annual base salary is paid monthly in equal installments in the Executive Board member’s home currency. Home currency is the currency of the Executive Board member’s primary place of residence.
Fringe Benefits
The contractually guaranteed fringe benefits mainly comprise insurance contributions, benefits in kind, expenses for maintenance of two households, use of aircraft, payment of fees for tax advice (for example, if service as an Executive Board member triggers a tax liability, a duty to file tax returns in additional countries or special tax audits) and tax gross-ups according to local conditions.
Pension-Related Commitments
Executive Board members receive a cash allowance, as an annual one-off payment, toward their own pension provision. The Supervisory Board may grant the Executive Board members the option to elect that some or all of the cash allowance be paid into the Employee-Financed Pension Plan (Mitarbeiterfinanzierte Altersvorsorge) in place at SAP SE. Under this option, part of the Executive Board member’s gross pay is exchanged in return for an entitlement to occupational pension benefits payable at a future date.
Thomas Saueressig opted to remain with the defined-contribution pension plan instead of receiving the cash allowance.
For Executive Board members whose permanent place of residence is outside Germany, SAP may specify a retirement pension plan that applies for employees at a company belonging to the SAP Group in the relevant country.
16 The following U.S.-based companies were included: Adobe, Amazon.com, Apple, Automatic Data Processing, Broadcom, Cisco Systems, Cognizant Technology Solutions, Dell Technologies, DXC Technology, Meta Platforms, Hewlett Packard Enterprise, International Business Machines, Microsoft, Netflix, Oracle, Salesforce, ServiceNow, Western Digital, and Workday.
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Event-Related Compensation Elements
Replacement Award
To the extent that compensation benefit earned prior to moving to the SAP Executive Board is lost due to this move, a replacement award reasonably replicating the structure of the forfeited compensation in terms of the payment times and amounts (like-for-like) may be granted. The replacement award may comprise cash payments and/or virtual shares.
If virtual shares are granted, the following applies:
– | The number of virtual shares is determined by dividing a grant amount by the relevant SAP share price (“initial price”). The initial price is based on an average price over a period of 10 trading days. |
– | The terms of the virtual shares must appropriately replicate the forfeited compensation components. |
– | The payout of the virtual shares corresponds to the relevant SAP share price at the end of the term of the respective virtual shares, but no more than 200% of the initial price. The relevant SAP share price is based on an average price of a period of 10 trading days. |
– | Payments made under the replacement award must not exceed 100% of the maximum compensation in the first year of the new Board member joining SAP. |
Mobility Package
Executive Board members who, at the request of SAP, relocate their place of work or permanent place of residence, and Executive Board members who are appointed for the first time and relocate their permanent place of residence on account of the appointment, may be granted one-time and temporary benefits as support in this connection.
If SAP grants an Executive Board member a mobility package, it will be paid as compensation for the financial year in which the member relocates their place of work or permanent place of residence. The maximum compensation for this financial year is increased by the value of the mobility package, but by no more than 5% of the maximum compensation.
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Performance-Based Compensation
Short-Term Incentive
The short-term, one-year performance-based compensation (“short-term incentive,” STI) is granted in the Executive Board member’s home currency for a single year. Payment of part of the payout amount under the STI is deferred by one or two additional years and linked to the performance of the SAP share price (“STI deferral”). The basic structure of the STI, including the STI deferral, is as follows:
The final STI amount depends on target achievement against certain financial and non-financial KPIs. The KPIs and their weightings are as follows:
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For the STI 2025, the financial KPIs have a total weighting of 80% and comprise free cash flow; non-IFRS constant currency current cloud backlog in 2025; and year-over-year growth in non-IFRS constant currency cloud and software revenue in 2025. Non - IFRS measures are based on the non - IFRS definition as applicable from January 1, 2025.
The non-financial KPIs have a total weighting of 20%, and comprise the Customer Net Promoter Score (NPS), which measures SAP’s customer loyalty; and the Employee Engagement Index (EEI) score, which measures SAP employees’ commitment, pride, and loyalty.
The KPIs and their respective target values are derived from SAP’s budget for the respective year. For more information about KPIs, see the section Performance Management System.
Replacement of KPIs in Line with the Compensation System in 2026
On December 17, 2025, the Supervisory Board resolved to replace the STI KPI Customer Net Promoter Score (NPS) with the KPI Cloud Customer Satisfaction (Cloud CSAT) from 2026 onward in accordance with the compensation system for Executive Board members. With this change, the Supervisory Board aligns the KPI to our cloud-first strategy. For more information about the Cloud CSAT KPI, see the section Performance Management System.
STI Deferral
Eighty percent of the STI will be paid out after the Annual General Meeting of Shareholders in the year after the STI was granted (grant year +1). Twenty percent of the final STI amount, the STI deferral, is converted into virtual shares, 50% of which have a term of approximately one year and 50% a term of approximately two years. The number of virtual shares is determined by dividing the STI deferral by the relevant SAP share price (“initial price”). The initial price is based on an average SAP share price over a period of 10 trading days after publication of SAP’s preliminary results for the financial year in which the STI was granted.
The virtual shares will be paid out at the relevant SAP share price, but no more than 200% of the initial price, at the end of the term of the virtual shares.
The virtual shares are paid out after the Annual General Meeting of Shareholders in the grant year +2 and grant year +3.
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Long-Term Incentive
The SAP Long-Term Incentive Program 2024 (LTI 2024) is granted in annual tranches and reflects SAP’s long-term strategy and thus sets uniform incentives for the Executive Board members to achieve key targets from the long-term strategic plans. The LTI 2024 is fully performance-based and rewards the Executive Board members for the long-term SAP share price performance as compared to the market, thus ensuring that shareholders’ interests are also honored. The LTI 2024 also includes ESG targets to reward the Executive Board members for the long-term sustainability of the Company.
The LTI 2024 is a virtual share program under which annual tranches with a term of approximately four years each are granted. When the individual tranches are granted, a certain grant amount specified in the Executive Board member’s service contract is converted into virtual shares (“performance share units,” PSUs) in each case. The grant amount is divided by the SAP share price, which corresponds to the average on the 10 trading days after publication of the preliminary results for the financial year (grant price). In 2025, the financial results were published before the Frankfurt Stock Exchange opened on January 29, 2025. The PSUs have a vesting period of approximately four years.
The basic structure of the LTI 2024 is as follows:
The underlying KPIs and their weightings are as follows:
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Changes in the Number of Financial PSUs
The final number of financial PSUs changes depending on SAP’s performance against the three financial KPI target values over the entire three-year performance period. The target values for each tranche are based on the cumulative three-year values of each KPI. The total revenue KPI has a performance corridor comprising a cap of 110% and a hurdle of 90% target achievement, while the operating profit KPI has a cap of 120% and a hurdle of 80% target achievement. If the lower threshold of the performance corridor for the respective KPI is not reached, the financial performance factor is zero. If the lower threshold is reached, the financial performance factor is 0.5. If the upper threshold of the performance corridor is reached or exceeded, the financial performance factor is 1.5 (cap).
1 Based on non-IFRS definition as applicable from January 1, 2025.
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The following tables illustrate possible outcomes for a hypothetical grant of 1,000 financial PSUs:
SAP financial performance is better than targets | |
| | |
30% Total revenue performance factor |
|
| 1.25 | |
20% Operating profit performance factor |
|
| 1.38 | |
Weighted financial performance factor | 1.30 | |||
Final number of financial PSUs | 1.30 x 1,000 | 1,300 | ||
SAP financial performance does not meet the targets |
| | ||
30% Total revenue performance factor |
| 0.75 | ||
20% Operating profit performance factor |
|
| 1.00 | |
Weighted financial performance factor |
|
| 0.85 | |
Final number of financial PSUs |
| 0.85 x 1,000 |
| 850 |
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Changes in the Number of Market PSUs
The number of market PSUs initially awarded is multiplied by a market performance factor. The market performance factor depends on the amount of the total shareholder return (TSR) on SAP share, measured for an entire performance period of approximately three years, and ranked in relation to the TSR performance of the companies in the NASDAQ-100 Index (Index). TSR reflects the performance of share, combining share price changes and granted and reinvested dividends. The market performance factor has a cap at 1.5 at the 75th percentile (P-75) and a hurdle of 0.5 at the 25th percentile (P-25); below the hurdle, no market PSUs are considered.
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The following tables illustrate possible outcomes for a hypothetical grant of 1,000 market PSUs:
SAP TSR performs better than TSR of NASDAQ-100 companies | | | | |
SAP TSR performance | +10% | |||
Market performance factor | 55th percentile | 1.10 | ||
Final number of market PSUs |
| 1.10 x 1,000 |
| 1,100 |
SAP TSR performs better than TSR of NASDAQ-100 companies; cap is triggered |
| |
| |
SAP TSR performance |
| +18% | ||
Market performance factor |
| 80th percentile |
| 1.60 |
| Cap 75th percentile | 1.50 | ||
Final number of market PSUs |
| 1.50 x 1,000 |
| 1,500 |
SAP TSR performs better than TSR of NASDAQ-100 companies; in a downwards market trend |
| |
| |
SAP TSR performance |
| –5% | ||
Market performance factor |
| 60th percentile |
| 1.20 |
| 1.00 | |||
Final number of market PSUs |
| 1.00 x 1,000 |
| 1,000 |
TSR of NASDAQ-100 companies perform better than SAP TSR; low hurdle is triggered |
| |
| |
SAP TSR performance |
| –5% | ||
Market performance factor |
| 20th percentile |
| 0.40 |
| Hurdle 25th percentile | 0 | ||
Final number of market PSUs |
| 0.00 x 1,000 |
| 0 |
Changes in the Number of ESG PSUs
The final number of ESG PSUs changes depending on SAP’s performance against the two non-financial KPI target values over the entire three-year performance period. The target values for each tranche are based on the cumulative three-year values of each KPI. The Net Zero 2030 KPI considers gross greenhouse gas (GHG) emissions along the value chain in line with the Greenhouse Gas Protocol. SAP’s Business Health Culture Index (BHCI) is a key metric tracking employee experience across themes such as engagement, health, and long-term employability. The Net Zero 2030 KPI will be assessed in absolute values; the BHCI is calculated from the percentage of favorable responses to 10 questions in the recurring #Unfiltered engagement survey. For more information about changes to KPIs compared to 2024, see the Decisions for 2025 section. For more information about KPIs, see the section Performance Management System.
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The BHCI KPI has a performance corridor with a cap of 104% and a hurdle of 96% target achievement; the Net Zero 2030 KPI has a cap of 110% and a hurdle of 90% target achievement. If the lower threshold of the performance corridor is not reached, the ESG performance factor is zero. If the lower threshold is reached, the ESG performance factor is 0.5. If the upper threshold of the performance corridor is reached or exceeded, the ESG performance factor is 1.5 (cap).
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Payout of PSUs
The value of all PSUs is paid out after the Annual General Meeting of Shareholders at which the financial statements for the third financial year following the financial year in which the PSUs were granted are presented (grant year +4). The performance of the PSUs is linked to the performance of the SAP share price, including dividend payments. Dividend equivalents are only awarded for vesting PSUs following the performance assessment. Accordingly, an amount is paid out for each PSU (subject to the specifics described below) that equals the then-current SAP share price plus the dividends disbursed in respect of an SAP share in the period from the beginning of the year in which the PSU were granted until the end of the third year following the year in which the PSU were granted. The average price of SAP shares on the 10 trading days after publication of the preliminary results for the financial year determines the payout price.
The final LTI payout amount per PSU, including the dividend due on the PSU, is capped at 200% of the grant price. Due to the potential change in the number of PSUs, the maximum possible payout amount under any of the annual tranches of the LTI 2024 is thus 300% of the grant amount. Currency exchange rate risks are borne by the Executive Board members.
Under certain conditions, each type of PSU may expire during the term of a tranche.
LTI Forfeiture Rule
If an Executive Board member’s service contract is terminated before the end of the third year following the year in which the share units were granted, the PSUs are forfeited in whole or in part, depending on the circumstances in which the member resigns from office or the service contract is terminated. Where share units are forfeited in part, the percentage of the forfeiture is proportional to the four-year vesting period of each grant. This means that 25% of the grant is earned each year of the vesting period. Unearned grants are forfeited.
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LTI Forfeiture Rules and Example Calculation1
1 Example calculation with four tranches (grant allocation of 100%, stable share price from grant to vest, and no consideration of performance criteria); Executive Board member’s contract terminates after year four.
2 As defined in the individual Executive Board members’ contracts.
3 For the definition, see the Early End-of-Service Undertakings section.
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Share Ownership Guidelines (SOG)
The Executive Board members must acquire SAP shares and hold them at least for the duration of their term of office. Following a build-up period of up to three years (beginning at the start of the member’s first term of office but not before January 1, 2024), the shareholding for ordinary Executive Board members corresponds to a target value equal to 100% of annual base salary, and for the CEO 200% of annual base salary.
During the build-up period, the SOG shareholding must reach certain interim values. The SOG interim value at the end of the first year equals 20% of the SOG target value and the SOG interim value at the end of the second year equals 50% of the SOG target value. The SOG target value must have been achieved at the end of the third year.
| SOG Target | | SOG Interim | | SOG Share Price | | SOG Shareholding on | ||
Value | Value | 2025 | 12/31/2025 (in shares) | ||||||
Christian Klein (CEO) | € | 2,500,000 | 1,250,000 | 270 | 4,630 | ||||
Muhammad Alam |
| US$ | 860,424 |
| 430,212 |
| 280 |
| 1,538 |
Dominik Asam | € | 800,000 |
| 400,000 |
| 270 |
| 1,482 | |
Thomas Saueressig | € | 800,000 |
| 400,000 |
| 270 |
| 1,482 | |
Sebastian Steinhaeuser (from 2/1/2025) | € | 800,000 | 160,000 | 270 | 593 | ||||
Gina Vargiu-Breuer | € | 800,000 |
| 400,000 |
| 270 |
| 1,482 | |
On an annual basis, the number of shares to be held by an Executive Board member will be adjusted in line with SAP’s share price performance. The SOG share price corresponds to the average on the 10 trading days after publication of the preliminary results for the financial year. The number of shares determined by the Supervisory Board on this basis, and the date from which this number must be held, will be communicated to the Executive Board member. Where the shareholding is greater than the number that applied on December 31 of the current year, the Executive Board member is free to sell any excess number of SAP shares during the respective financial year.
Foreign Currency Exchange Rate Cap
Where the non-performance-based compensation and the STI are paid out in the Executive Board member’s home currency, the total (gross) payout amount resulting from the non-performance-based compensation and the STI for a financial year is limited to a maximum euro equivalent in case of exchange rate fluctuations. The euro cap for a full financial year equals 120% each for the sum of the non-performance-based compensation and STI target amount converted into euros plus 20% of the grant amount for a tranche under the LTI 2024.
Maximum Compensation
Maximum compensation under the compensation system effective since 2024 is the value that the total compensation for any financial year (irrespective of the time of receipt) must not exceed. Maximum compensation is €11.0 million for each ordinary Executive Board member and €20.0 million for a CEO. If an Executive Board member has their place of work in a country where the levels of compensation are higher than in Germany, maximum compensation could be 130% of the relevant value.
If an Executive Board member is granted a mobility package or a replacement award, the compensation they receive for the financial year may exceed the maximum compensation defined above. If a mobility package is granted, its maximum value is capped at 5% of the maximum compensation defined above. If a replacement award is granted, its maximum value is capped at 100% of the maximum compensation defined above.
Maximum | ||
€ thousands | | Compensation |
Christian Klein (CEO) | 20,000 | |
Muhammad Alam | 11,000 | |
Dominik Asam |
| 11,000 |
Thomas Saueressig |
| 11,000 |
Sebastian Steinhaeuser (from 2/1/2025) |
| 10,083 |
Gina Vargiu-Breuer |
| 11,000 |
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The final confirmation of compliance with the maximum compensation for the fiscal year 2025 will be disclosed in the Compensation Report for the fiscal year 2028 at the earliest, when the LTI tranche for 2025 is settled.
The maximum compensation under the compensation system applicable until 2023 still applies until the last granted variable compensation component of the LTI 2020 (tranche 2023) is paid out in 2026. The maximum compensation is €15.0 million for ordinary Executive Board members and €34.5 million for a CEO. When determining the compensation structure and the target compensation for the individual members of the Executive Board, the Supervisory Board ensured that the potential payments, did not exceed maximum compensation.
Clawback Provisions and Clawback Policy
SAP has the contractual right to request that an Executive Board member return any payments made from the STI or LTI if it subsequently emerges that the information used to determine the payout was inaccurate and that therefore the amount paid out was not justified, either in whole or in part, because targets were either not achieved or not achieved to the extent initially assumed. In this event, the Executive Board member is obliged to repay to SAP the amount by which the initial payment exceeds the amended payment as determined on the basis of the targets actually achieved.
In addition, in compliance with requirements issued by the U.S. Securities and Exchange Commission and the New York Stock Exchange for companies listed in the United States, including foreign private issuers such as SAP, SAP adopted a clawback policy in 2023. This policy requires the Supervisory Board to recoup incentive-based compensation from current and former Executive Board members in the event that financial statements are restated due to material non-compliance with any financial reporting requirement under the U.S. federal securities laws that impacts the calculation of incentive-based compensation paid out in the last three years.
Offsetting Compensation for Roles Assumed Inside and Outside the Group
At the request of the Supervisory Board, the Executive Board member will assume roles on the supervisory board or similar bodies at affiliates of SAP without receiving separate compensation. If, in exceptional cases, compensation is, however, paid for a role assumed within the Group, it will be offset against the other compensation due to the Executive Board member. The Supervisory Board has to agree before an Executive Board member assumes any roles on supervisory boards or similar bodies at companies outside the Group and will decide in each case whether and to what extent any compensation is to be offset against compensation paid by SAP.
Decisions for 2025
No adjustments were made to the payout amounts for the STI 2024 or LTI 2020 tranche 2021 paid in May 2025. The Supervisory Board did not request that any Executive Board member return payments under the clawback provision. On February 19, 2025, the Supervisory Board assessed SAP’s performance against the previously agreed targets and determined the amount of the STI 2024 for all members of the Executive Board.
On November 7, 2024, the Supervisory Board resolved to replace the KPI operating margin increase with the KPI free cash flow for the Executive Board STI as of 2025. With this change, the Supervisory Board recognizes the role that free cash flow plays in value creation for the Company. It also believes that this change better aligns the steering to value creation.
On December 8, 2024, the Supervisory Board resolved to replace the KPIs cloud revenue and software licenses & support and services revenue with the KPI total revenue for the Executive Board LTI as of 2025. The Supervisory Board gave more weight to cloud revenue, given the importance of this metric to the cloud transition. As cloud revenue now represents the majority of total revenue, the Supervisory Board aims to simplify the structure of the LTI with this change.
On January 19, 2025, the Supervisory Board appointed Sebastian Steinhaeuser to the Executive Board with an appointment term from February 1, 2025, to January 31, 2028, and extended the appointment of Thomas Saueressig as member of the Executive Board from November 1, 2025, to October 31, 2028.
On April 30, 2025, the Supervisory Board resolved to extend the term of Christian Klein’s appointment to the Executive Board from May 1, 2025, to April 30, 2030.
On May 6, 2025, the Supervisory Board decided to exchange the Women in Executive Roles KPI with the Business Health Culture Index in the LTI as of 2025, resulting in a temporary deviation from the compensation system and the German Corporate Governance Code to ensure compliance with executive orders in the United States. SAP remains committed to creating an inclusive workplace where all employees have equal opportunities, so that the Company fully complies with the legal requirements in every country in which it operates.
On November 6, 2025, the Supervisory Board decided to exclude the effect of the SmartRecruiters acquisition from the target achievement for the STI 2025 and the LTI tranche 2023. For the LTI tranches 2024 and 2025, the Supervisory Board resolved updated targets to neutralize the effects of the acquisition.
At the beginning of 2026, the Supervisory Board decided to exclude the effect of the expenses related to the Teradata litigation from the Company’s non‑IFRS definition, as these one‑off effects are not indicative of our operating performance. The Supervisory Board also decided on February 18, 2026 to exclude these effects from the target achievement for the KPI operating profit, which ensures consistency between Executive Board compensation and the Company’s non-IFRS definition. This approach is consistent with the treatment applied to the dividend calculation and employee compensation. Further, the Teradata litigation relates to matters that occurred before the term of office of the current Executive Board members. The exclusion of current expenses of €387 million has a positive effect on the performance factor for the financial PSUs of 0.011 for the 2023 tranche under the LTI 2020. As the ongoing performance period is measured using cumulative results, the impact will be shown when the LTI tranches 2024 and 2025 are due for payout.
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STI Performance Factor 2025
KPI | | 100% Target Value | Results | | Performance Factor | |
Current cloud backlog1 |
| €22,905 million | €22,461 million |
| 0.903 | |
Cloud and software revenue growth1 |
| +11.8 | % | +12.0 | % | 1.024 |
Free cash flow1 |
| €8,000 million | €8,242 million |
| 1.151 | |
Customer Net Promoter Score |
| +14 | +9 |
| 0.750 | |
Employee Engagement Index |
| 76 | % | 76 | % | 1.000 |
1 Non-IFRS, at constant currencies
The weighted performance factor for the STI 2025 was 0.990. The final STI payout amount related to the STI deferral depends on SAP share price development.
The following target achievement curves applied for the STI 2025:
Financial KPIs
Non-Financial KPIs
The final performance factor for the STI reflects the relation between the grant amount and the final STI amount.
STI Final Performance Factor
| 2025 | | 2024 | | 2023 | | 2022 | | 2021 | |
| 0.990 |
| 1.143 |
| 1.151 |
| 0.612 |
| 1.333 |
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STI Deferral I in | STI Deferral II | |||||||||||||||
Amounts, unless otherwise stated | | | | STI Grant Amount | | Final STI Amount1 | | STI Non-Deferral | | STI Deferral I | | Virtual Shares2 | | STI Deferral II | | in Virtual Shares2 |
Christian Klein (CEO) |
| € |
| 3,725,205 |
| 3,687,208 |
| 2,949,767 |
| 368,721 |
| 2,152 |
| 368,721 |
| 2,152 |
Muhammad Alam |
| US$ |
| 1,591,784 |
| 1,575,548 |
| 1,260,438 |
| 157,555 |
| 776 |
| 157,555 |
| 776 |
Dominik Asam |
| € |
| 1,480,000 |
| 1,464,904 |
| 1,171,923 |
| 146,490 |
| 855 |
| 146,490 |
| 855 |
Thomas Saueressig |
| € |
| 1,693,589 |
| 1,676,314 |
| 1,341,052 |
| 167,631 |
| 978 |
| 167,631 |
| 978 |
Sebastian Steinhaeuser (from 2/1/2025) |
| € |
| 1,171,288 |
| 1,159,341 |
| 927,473 |
| 115,934 |
| 677 |
| 115,934 |
| 677 |
Gina Vargiu-Breuer |
| € |
| 1,280,000 |
| 1,266,944 |
| 1,013,555 |
| 126,694 |
| 739 |
| 126,694 |
| 739 |
1 STI performance factor 0.990
2 STI initial price €171.35 and US$203.10
LTI 2024 − Tranche 2025 – Financial PSUs and ESG PSUs 100% Target Values
In 2025, the Supervisory Board set the 100% target values for the financial PSUs and the ESG PSUs of the LTI 2024 tranche 2025.
| 100% Target Value | |
KPI | (cumulative 2025 to 2027) | |
Total revenue1 |
| 128,000 |
Operating profit1 | 37,800 | |
Net Zero 2030 CO2e in kt2 |
| 9,610 |
Business Health Culture Index in % |
| 243 |
1 Non-IFRS, at constant currencies 2024
2 Target value, considering re-baselining of Net Zero 2030 KPI, using a mathematical, formula-based approach. For further details on re-baselining please refer to the section Performance Management System of the SAP Integrated Report 2025.
LTI 2020 − Tranche 2022 – Performance Factor
In 2025, the Supervisory Board determined the LTI performance factor of the financial PSUs and the market PSUs of the LTI 2020 tranche 2022.
KPI | | 100% Target Value | | | ||
(cumulative 2022 to 2024) | Results | Performance Factor | ||||
Financial performance factor | | | | |||
Cloud revenue1 |
| 41,900 |
| 41,379 |
| 0.938 |
Total revenue1 |
| 89,900 |
| 92,588 |
| 1.149 |
Operating profit1 |
| 25,900 |
| 26,715 |
| 1.079 |
Market performance factor |
| |
| |
| |
Ranking to NASDAQ-100 companies |
| median |
| 5 |
| 1.500 |
1 Non - IFRS, at constant currencies 2021
The calculation of target achievement was carried out based on the KPI definitions for 2022. This takes into account the previously published adjustments. The relation between the LTI grant amounts for the 2022 to 2025 tranches and the hypothetical payout amounts are based on the lower of SAP’s share price at year end or the defined capped payout price. The 2021 tranche discloses the relation between the respective grant amount and the final LTI payout amount in May 2025. The payout price for the tranche 2021 was capped at 200% of the grant price.
Relation Between Grant Amount and Final LTI Payout Amount
Percentage | LTI 2024 | LTI 2020 | ||||||||
| Tranche 20251 | | Tranche 20241 | | Tranche 20231 | | Tranche 20221 | | Tranche 2021 | |
12/31/2025 | 46.7 | 126.9 |
| 201.7 |
| 199.7 |
| 246.8 | ||
12/31/2024 |
| NA | 167.3 | 250.7 |
| 237.0 |
| 246.8 | ||
1 Consideration of hypothetical payout amounts based on market data and SAP’s share price, capped at 200% of the grant price. Evaluations were conducted at year end, except the share price evaluation. To account for the share price development in January 2026, SAP’s share price as of January 30, 2026, has been considered, being the first trading day of the reference share price period.
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Compensation for 2025
We present the Executive Board compensation disclosures in accordance with section 162 of the AktG, for the current year as well as for the previous year 2024. For each member of the Executive Board, the following tables disclose the compensation awarded and due as well as the contractual compensation in the reporting year.
Contractual Compensation
The contractual compensation shows the target amounts agreed in the individual employment contracts, including fringe benefits, and corresponds to a target achievement of 100% for the respective periods. If the appointment term commences or ends during a financial year, the compensation is disclosed pro rata temporis.
As the non-performance-based compensation and the STI are determined in the Executive Board member’s home currency, a maximum euro equivalent (“euro cap”) is considered to limit the exchange rate fluctuations to 20% of the sum of contractual values for non-performance-based compensation, STI, and LTI in euros. For purposes of converting the amounts from the home currency into euro, for non-performance-based compensation the average exchange rate, and for the one-year variable compensation the year-end exchange rate, of the respective period applies. The difference to the contractual exchange rate is disclosed.
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Compensation Awarded and Due
Compensation that has been received and/or earned in the reporting year is defined as compensation awarded and due based on section 162 of the AktG. This means that the underlying services were fully rendered by the end of the reporting year, although payout occurs only after the end of the reporting year to make reporting transparent and comprehensible and to ensure a connection between performance and compensation in the reporting period.
Therefore, the STI 2025 and the LTI 2020 tranche 2022 are both reported in 2025. The amount disclosed under STI deferral I in the year 2025 includes 10% of the final STI amount of the STI 2025 and the share price impact of the STI 2024 deferral I. The compensation awarded and due related to the LTI 2020 tranche 2022 is disclosed with the share price on January 30, 2026. The payout of this tranche in May 2026 will be calculated based on the performance period according to the plan terms.
1 Cap at 200% of grant price per share.
2 Value is determined at time of payout after the Compensation Report has been prepared.
3 To account for the share price development in January 2026, SAP's share price as of January 30, 2026, has been considered, being the first trading day of the reference share price period.
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For the non-performance-based compensation and the STI paid out in the Executive Board member’s home currency, the amounts are converted to euro for reporting purposes. While for the non-performance-based compensation conversion into euro the annual average exchange rate applies, the STI is converted using the exchange rate at year-end. For the payout of the STI non-deferral (which is due after the annual general meeting of shareholders) and the STI deferral, the exchange rate at payout will apply. The individual amount resulting from the difference between the exchange rate at year end and at payout will be disclosed in the following tables under “Exchange rate fluctuations” in the year of payment.
Executive Board Members’ Compensation
Christian Klein | Muhammad Alam | ||||||||||||||||||||
CEO | Member of the Executive Board | ||||||||||||||||||||
Contractual Compensation | Compensation Awarded and Due | Contractual Compensation | Compensation Awarded and Due | ||||||||||||||||||
€ thousands | | 2025 | | 2024 | | 2025 | In % | | 2024 | In % | | 2025 | | 2024 | | 2025 | In % | 2024 | In % | ||
Annual base salary |
| 1,200 |
| 1,100 |
| 1,200 | 7.4 |
| 1,100 | 5.8 |
| 800 |
| 600 | 800 | 35.6 | 600 | 31.0 | |||
Fringe benefits1 |
| 15 |
| 15 |
| 15 | 0.1 |
| 15 | 0.1 |
| 82 |
| 24 |
| 82 | 3.7 | 24 | 1.2 | ||
Pension-related commitments | 360 | 330 | 360 | 2.2 | 330 | 1.7 | 154 | 154 | 6.9 | 0 | |||||||||||
Exchange rate fluctuations (euro cap)2 | -255 | 41 | -255 | -11.4 | 41 | 2.1 | |||||||||||||||
Total non-performance-based compensation |
| 1,575 |
| 1,445 |
| 1,575 | 9.7 |
| 1,445 | 7.6 |
| 781 |
| 665 |
| 781 | 34.8 | 665 | 34.3 | ||
One-year variable compensation |
|
|
|
|
|
|
| ||||||||||||||
STI non-deferral (80%) | 2,980 | 2,368 | 2,950 | 18.2 | 2,706 | 14.3 | 1,184 | 890 | 1,172 | 52.2 | 1,017 | 52.5 | |||||||||
STI deferral I (10%) | 373 | 296 | 369 | 2.3 | 338 | 1.8 | 148 | 111 | 146 | 6.5 | 127 | 6.6 | |||||||||
STI deferral II (10%) | 373 | 296 | 369 | 2.3 | 338 | 1.8 | 148 | 111 | 146 | 6.5 | 127 | 6.6 | |||||||||
Multiyear variable compensation | |||||||||||||||||||||
LTI 2020 – Tranche 2020 |
|
|
|
| 581 | 3.1 |
| ||||||||||||||
LTI 2020 – Tranche 2021 | 0 | 13,573 | 71.5 | ||||||||||||||||||
LTI 2020 – Tranche 2022 | 10,982 | 67.6 | |||||||||||||||||||
LTI 2024 – Tranche 2024 | 4,440 | 1,668 | |||||||||||||||||||
LTI 2024 – Tranche 2025 | 5,588 | 2,220 | |||||||||||||||||||
Total performance-based compensation |
| 9,313 |
| 7,400 |
| 14,669 | 90.3 |
| 17,538 | 92.4 |
| 3,700 |
| 2,780 |
| 1,465 | 65.2 | 1,271 | 65.7 | ||
Total |
| 10,888 |
| 8,845 |
| 16,244 | 100.0 |
| 18,983 | 100.0 |
| 4,481 |
| 3,445 |
| 2,246 | 100.0 | 1,936 | 100.0 | ||
With the reappointment of Christian Klein, the Supervisory Board resolved to increase his annual target compensation from €8.5 million to €11.5 million. The adjustment to his target salary is related to the development in industry benchmarks and in accordance with his expanded responsibility. The pro-rata increase is reflected in the table above effective November 1, 2025.
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Dominik Asam | Thomas Saueressig | ||||||||||||||||||||
Member of the Executive Board | Member of the Executive Board | ||||||||||||||||||||
€ thousands | Contractual Compensation | Compensation Awarded and Due | Contractual Compensation | Compensation Awarded and Due | |||||||||||||||||
| 2025 | | 2024 | | 2025 | In % | | 2024 | In % | | 2025 | | 2024 | | 2025 | In % | 2024 | In % | |||
Annual base salary | 800 | | 800 | | 800 | 31.6 | | 800 | 24.4 | | 800 | | 800 | | 800 | 11.4 | 800 | 9.7 | |||
Fringe benefits1 |
| 26 |
| 27 |
| 26 | 1.0 |
| 27 | 0.8 |
| 18 |
| 17 |
| 18 | 0.3 | 17 | 0.2 | ||
Pension-related commitments | 240 | 180 | 240 | 9.5 | 180 | 5.5 | |||||||||||||||
Replacement award |
|
|
|
| 0 |
|
|
| |||||||||||||
Total non-performance-based compensation |
| 1,066 |
| 1,007 |
| 1,066 | 42.1 |
| 1,007 | 30.7 |
| 818 |
| 817 |
| 818 | 11.6 | 817 | 9.9 | ||
One-year variable compensation |
|
|
|
|
|
|
| ||||||||||||||
STI non-deferral (80%) | 1,184 | 1,592 | 1,172 | 46.3 | 1,819 | 55.5 | 1,355 | 1,280 | 1,341 | 19.0 | 1,463 | 17.8 | |||||||||
STI deferral I (10%) | 148 | 199 | 146 | 5.8 | 227 | 6.9 | 169 | 160 | 168 | 2.4 | 183 | 2.2 | |||||||||
STI deferral II (10%) | 148 | 199 | 146 | 5.8 | 227 | 6.9 | 169 | 160 | 168 | 2.4 | 183 | 2.2 | |||||||||
Multiyear variable compensation |
|
|
|
|
|
|
| ||||||||||||||
LTI 2020 - Tranche 2020 | 230 | 2.8 | |||||||||||||||||||
LTI 2020 - Tranche 2021 | 0 | 5,366 | 65.1 | ||||||||||||||||||
LTI 2020 – Tranche 2022 | 4,550 | 64.6 | |||||||||||||||||||
LTI 2024 – Tranche 2024 |
|
| 2,932 |
|
|
|
| 2,400 |
| ||||||||||||
LTI 2024 - Tranche 2025 | 2,220 | 2,540 | |||||||||||||||||||
Total performance-based compensation |
| 3,700 |
| 4,922 |
| 1,465 | 9.0 |
| 2,274 | 12.0 |
| 4,234 |
| 4,000 |
| 6,226 | 278.0 | 7,424 | 383.5 | ||
Total |
| 4,766 |
| 5,929 |
| 2,531 | 15.6 |
| 3,281 | 17.3 |
| 5,052 |
| 4,817 |
| 7,044 | 314.5 | 8,241 | 425.7 | ||
With the reappointment of Thomas Saueressig, the Supervisory Board resolved to increase his annual target compensation from €4.8 million to €6.2 million. The adjustment to his target salary is related to the development in industry benchmarks and to reflect his enhanced capabilities and expertise. The pro-rata increase is reflected in the table above effective November 1, 2025.
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Sebastian Steinhaeuser | Gina Vargiu-Breuer | ||||||||||||||||||||
Member of the Executive Board (from 2/1/2025) | Member of the Executive Board | ||||||||||||||||||||
Contractual Compensation | Compensation Awarded and Due | Contractual Compensation | Compensation Awarded and Due | ||||||||||||||||||
€ thousands | | 2025 | | 2024 | | 2025 | In % | | 2024 | In % | | 2025 | | 2024 | | 2025 | In % | 2024 | In % | ||
Annual base salary |
| 733 |
|
| 733 | 34.4 |
|
| 800 |
| 733 |
| 800 | 31.7 | 733 | 34.8 | |||||
Fringe benefits1 | 18 | 18 | 0.9 | 23 | 36 | 23 | 0.9 | 36 | 1.7 | ||||||||||||
Pension-related commitments | 220 | 220 | 10.3 | 240 | 220 | 240 | 9.5 | ||||||||||||||
Replacement award | 0 | 300 | 194 | 7.7 | |||||||||||||||||
Total non-performance-based compensation |
| 972 |
| 0 |
| 972 | 45.6 |
|
| 1,063 |
| 1,290 |
| 1,257 | 49.8 | 770 | 36.5 | ||||
One-year variable compensation |
|
|
|
|
|
|
| ||||||||||||||
STI non-deferral (80%) | 937 | 927 | 43.5 | 1,024 | 937 | 1,014 | 40.2 | 1,071 | 50.8 | ||||||||||||
STI deferral I (10%) | 117 | 116 | 5.4 | 128 | 117 | 127 | 5.0 | 134 | 6.3 | ||||||||||||
STI deferral II (10%) | 117 | 116 | 5.4 | 128 | 117 | 127 | 5.0 | 134 | 6.3 | ||||||||||||
Multiyear variable compensation | |||||||||||||||||||||
LTI 2020 - Tranche 2020 |
|
|
|
|
| ||||||||||||||||
LTI 2020 - Tranche 2021 | |||||||||||||||||||||
LTI 2020 - Tranche 2022 | |||||||||||||||||||||
LTI 2024 - Tranche 2024 | 1,757 | ||||||||||||||||||||
LTI 2024 - Tranche 2025 | 1,757 | 1,920 | |||||||||||||||||||
Total performance-based compensation |
| 2,928 |
| 0 |
| 1,159 | 6.3 |
|
| 3,200 |
| 2,929 |
| 1,267 | 56.6 | 1,339 | 69.2 | ||||
Total |
| 3,900 |
| 0 |
| 2,131 | 11.6 |
|
| 4,263 |
| 4,219 |
| 2,524 | 112.7 | 2,109 | 108.9 | ||||
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Total Executive Board | |||||||||
Contractual Compensation | Compensation Awarded and Due | ||||||||
€ thousands | 2025 | 2024 | 2025 | In % | 2024 | In % | |||
Annual base salary |
| 5,133 |
| 4,033 |
| 5,133 | 15.7 | 4,033 | 11.7 |
Fringe benefits1 |
| 183 |
| 120 |
| 183 | 0.6 | 120 | 0.3 |
Pension-related commitments | 1,214 | 730 | 1,214 | 3.7 | 510 | 1.5 | |||
Exchange rate fluctuations (euro cap)2 |
| -255 |
| 41 |
| -255 | -0.8 | 41 | 0.1 |
Replacement award |
| 0 |
| 300 |
| 194 | 0.6 | 0 | 0 |
Total non-performance-based compensation |
| 6,275 |
| 5,224 |
| 6,469 | 19.8 | 4,704 | 13.6 |
One-year variable compensation |
|
|
| ||||||
STI non-deferral (80%) |
| 8,664 |
| 7,067 |
| 8,576 | 26.2 | 8,077 | 23.4 |
STI deferral I (10%) | 1,083 | 883 | 1,072 | 3.3 | 1,010 | 2.9 | |||
STI deferral II (10%) | 1,083 | 883 | 1,072 | 3.3 | 1,010 | 2.9 | |||
Multiyear variable compensation |
|
|
| ||||||
LTI 2020 – Tranche 2020 |
|
|
| 811 | 2.3 | ||||
LTI 2020 - Tranche 2021 |
|
|
| 0 | 0 | 18,939 | 54.8 | ||
LTI 2020 - Tranche 2022 | 15,532 | 47.5 | |||||||
LTI 2024 - Tranche 2024 |
|
| 13,197 |
| |||||
LTI 2024 - Tranche 2025 |
| 14,488 |
|
| |||||
Total performance-based compensation |
| 25,318 |
| 22,031 |
| 26,251 | 80.2 | 29,846 | 86.4 |
Total |
| 31,593 |
| 27,255 |
| 32,720 | 100.0 | 34,550 | 100.0 |
1 Insurance contributions, the private use of company cars and aircraft, payments and related supplements for relocation, benefits in kind, reimbursement of costs for preparation of tax returns, and tax gross-ups according to local conditions.
2 The value of the fixed and one-year variable compensation is granted in U.S. dollars.
Share-Based Payment Information Relating to Long-Term Incentives
Members of the Executive Board received, hold, or held Share Units issued to them under the LTI 2024 and hold or held Share Units issued to them under the LTI 2020. For more information about the terms and details of these programs, see the Notes to the Consolidated Financial Statements of the Integrated Report 2025, Note (B.3).
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Executive Board Members’ Holdings
1/1/2025 | During the Year | 12/31/2025 | ||||||||||||
Exercised (E)/ | Thereof | |||||||||||||
Adjusted (A)/ | Subject to | |||||||||||||
Quantity in share units | Specification | Grant Date | Outstanding | Granted | Forfeited (F) | Outstanding | Holding Period | |||||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 6,209 | 0 | 6,209 | 6,209 | ||||||||
LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 10,349 | 0 | 10,349 | 10,349 | ||||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 4,139 | 0 | 4,139 | 4,139 | ||||||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 8,168 | 0 | 0 | 8,168 | 8,168 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 13,613 | 0 | 0 | 13,613 | 13,613 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 5,445 | 0 | 0 | 5,445 | 5,445 | ||||||||
| LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | | 16,726 | | 0 | | 0 | 16,726 | | 16,726 | |||
LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 16,726 | 0 | 0 | 16,726 | 16,726 | ||||||||
Christian Klein (CEO) | LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 16,726 | 0 | 0 | 16,726 | 16,726 | |||||||
LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 17,197 | 0 | 8,599 | A | 25,796 | 25,796 | |||||||
LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 17,197 | 0 | 952 | A | 18,149 | 18,149 | |||||||
LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 17,197 | 0 | 0 | 17,197 | 17,197 | ||||||||
LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 25,845 | 0 | -25,845 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 20,707 | 0 | -20,707 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 17,230 | 0 | -17,230 | E | 0 | 0 | |||||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 2,467 | 0 | 2,467 | 2,467 | ||||||||
Muhammad Alam | LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 4,111 | 0 | 4,111 | 4,111 | |||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 1,645 | 0 | 1,645 | 1,645 | ||||||||
LTI 2024 – Tranche 2024 – Market PSU | 4/2/2024 | 3,068 | 0 | 0 | 3,068 | 3,068 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 4/2/2024 | 5,114 | 0 | 0 | 5,114 | 5,114 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 4/2/2024 | 2,046 | 0 | 0 | 2,046 | 2,046 | ||||||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 2,467 | 0 | 2,467 | 2,467 | ||||||||
Dominik Asam | LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 4,111 | 0 | 4,111 | 4,111 | |||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 1,645 | 0 | 1,645 | 1,645 | ||||||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 5,394 | 0 | 0 | 5,394 | 5,394 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 8,990 | 0 | 0 | 8,990 | 8,990 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 3,596 | 0 | 0 | 3,596 | 3,596 | ||||||||
LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 8,073 | 0 | 0 | 8,073 | 8,073 | ||||||||
LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 8,073 | 0 | 0 | 8,073 | 8,073 | ||||||||
LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 8,073 | 0 | 0 | 8,073 | 8,073 | ||||||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 2,823 | 0 | 2,823 | 2,823 | ||||||||
LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 4,705 | 0 | 4,705 | 4,705 | ||||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 1,882 | 0 | 1,882 | 1,882 | ||||||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 4,415 | 0 | 0 | 4,415 | 4,415 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 7,358 | 0 | 0 | 7,358 | 7,358 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 2,943 | 0 | 0 | 2,943 | 2,943 | ||||||||
Thomas Saueressig | LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 8,515 | 0 | 0 | 8,515 | 8,515 | |||||||
| LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 8,515 | 0 | 0 | 8,515 | 8,515 | |||||||
| LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 8,515 | 0 | 0 | 8,515 | 8,515 | |||||||
LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 7,125 | 0 | 3,563 | A | 10,688 | 10,688 | |||||||
| LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 7,125 | 0 | 394 | A | 7,519 | 7,519 | ||||||
| LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 7,125 | 0 | 0 | 7,125 | 7,125 | |||||||
LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 10,217 | 0 | -10,217 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 8,186 | 0 | -8,186 | E | 0 | 0 | |||||||
| LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 6,811 | 0 | -6,811 | E | 0 | 0 | ||||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 1,952 | 0 | 1,952 | 1,952 | ||||||||
Sebastian Steinhaeuser (from 2/1/2025) |
| LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 3,254 | 0 | 3,254 | 3,254 | ||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 1,302 | 0 | 1,302 | 1,302 | ||||||||
Gina Vargiu-Breuer | LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 0 | 2,133 | 0 | 2,133 | 2,133 | |||||||
LTI 2024 – Tranche 2025 – Financial PSU | 5/9/2025 | 0 | 3,556 | 0 | 3,556 | 3,556 | ||||||||
LTI 2024 – Tranche 2025 – ESG PSU | 5/9/2025 | 0 | 1,422 | 0 | 1,422 | 1,422 | ||||||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 3,233 | 0 | 0 | 3,233 | 3,233 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 5,388 | 0 | 0 | 5,388 | 5,388 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 2,155 | 0 | 0 | 2,155 | 2,155 | ||||||||
Total |
| 342,830 |
| 60,172 |
| -75,488 | 327,514 |
| 327,514 | |||||
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Main Conditions
| | | Grant Date Fair Value | | End of | | End of | | ||||
Specification | Grant Date | Grant Price (in €) | (in €) | Performance Period | Vesting Period | Payout | ||||||
LTI 2024 – Tranche 2025 – Financial PSU |
|
|
| 254.98 |
| December 2027 |
|
| ||||
LTI 2024 – Tranche 2025 – Market PSU | 5/9/2025 | 269.98 | 303.31 | February 2028 | 12/31/2028 | May 2029 | ||||||
LTI 2024 – Tranche 2025 – ESG PSU | 254.98 | December 2027 | ||||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 165.71 | ||||||||||
| 4/2/2024 |
|
| 166.25 |
| December 2026 |
|
| ||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 163.08 | 201.42 | 12/31/2027 |
| May 2028 | ||||||
| 4/2/2024 |
|
| 202.37 |
| February 2027 |
|
| ||||
LTI 2024 – Tranche 2024 – ESG PSU |
| 3/12/2024 |
|
| 165.71 |
|
| |||||
| 4/2/2024 |
|
| 166.25 |
| December 2026 |
|
| ||||
LTI 2020 – Tranche 2023 – Financial PSU |
|
|
| 105.81 |
| December 2025 |
|
| ||||
LTI 2020 – Tranche 2023 – Market PSU |
| 3/24/2023 |
| 109.61 |
| 130.56 |
| February 2026 |
| 12/31/2026 |
| May 2027 |
LTI 2020 – Tranche 2023 – RSU |
|
|
| 105.81 |
| NA |
|
| ||||
LTI 2020 – Tranche 2022 – Financial PSU |
|
|
| 96.84 |
| December 2024 |
| |||||
LTI 2020 – Tranche 2022 – Market PSU |
| 3/28/2022 |
| 106.61 |
| 108.20 |
| February 2025 |
| 12/31/2025 |
| May 2026 |
LTI 2020 – Tranche 2022 – RSU | 96.84 | NA | ||||||||||
LTI 2020 – Tranche 2021 – Financial PSU | 100.28 | December 2023 | ||||||||||
LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 106.41 | 115.19 | February 2024 | 12/31/2024 | May 2025 | ||||||
LTI 2020 – Tranche 2021 – RSU |
|
|
| 100.28 |
| NA |
|
|
End-of-Service Benefits
Regular End-of-Service Undertakings
Pension-Related Commitments
Christian Klein, Dominik Asam, Sebastian Steinhaeuser, and Gina Vargiu-Breuer receive an annual one-time payment in the form of a cash allowance that they can use for their own pension provision. In case a member of the Executive Board joins or leaves the Company during the year, the annual cash allowance is granted pro rata.
The Executive Board members can transfer all or part of this cash allowance into SAP SE’s employee-financed pension scheme. Christian Klein, Sebastian Steinhaeuser, and Gina Vargiu-Breuer opted to transfer the entire amount. Under this option, gross pay is exchanged for an entitlement to Company pension benefits, payable as a retirement benefit at the age of either 60 or 62.
In 2023, Thomas Saueressig opted to stay in the pension plan, which is a defined-contribution plan. The contribution is 4% of pensionable income up to the threshold for statutory pension insurance in Germany, plus 14% pensionable income above that threshold. For this purpose, pensionable income is 180% of annual base salary. The applicable threshold is the annual income threshold for statutory pension insurance. Under this plan, he is entitled to a retirement pension and a disability pension, as well as a widow’s pension for his surviving spouse.
For Muhammad Alam, SAP pays contributions to a third-party Executive Capital Accumulation Plan. SAP’s contributions match the contributions that Muhammad Alam pays into that deferred compensation plan.
Pension Entitlements of Current Executive Board Members
Defined Benefit Obligations | Net Defined Benefit Liability | |||||||||||||||
Service Cost | (DBO) | Plan Assets | (Asset) | |||||||||||||
€ thousands | | 2025 | | 2024 | | 12/31/2025 | | 12/31/2024 | | 12/31/2025 | | 12/31/2024 | | 12/31/2025 | | 12/31/2024 |
Christian Klein (CEO)1 |
| 0 |
| 0 |
| 401 |
| 452 |
| 1,305 |
| 1,275 |
| -904 |
| -823 |
Dominik Asam1 | 0 | 71 | 78 | 99 | 204 | 203 | -125 | -104 | ||||||||
Thomas Saueressig1 |
| 77 |
| 74 |
| 393 |
| 397 |
| 993 |
| 801 |
| -600 |
| -404 |
Total |
| 77 |
| 145 |
| 872 |
| 948 |
| 2,501 |
| 2,279 |
| -1,629 |
| -1,331 |
1 The values reflect the pension entitlements from the retirement pension plan for Executive Board members. Gina Vargiu-Breuer and Sebastian Steinhaeuser are not included in the table, as they never participated in the retirement pension plan.
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Pension Entitlements of Former Executive Board Members
Defined Benefit Obligations | Net Defined Benefit Liability | |||||||||||||||
Pension Payments | (DBO) | Plan Assets | (Asset) | |||||||||||||
€ thousands | | 2025 | | 2024 | | 12/31/2025 | | 12/31/2024 | | 12/31/2025 | | 12/31/2024 | | 12/31/2025 | | 12/31/2024 |
Adaire Fox-Martin | 0 | 0 | 403 | 414 | 787 | 768 | -384 | -354 | ||||||||
Bernd Leukert |
| 0 | 0 | 588 | 626 | 1,188 | 1,159 | -601 | -533 | |||||||
Luka Mucic | 0 | 0 | 663 | 727 | 1,414 | 1,382 | -751 | -655 | ||||||||
Juergen Mueller | 0 | 0 | 211 | 239 | 816 | 797 | -605 | -558 | ||||||||
Gerhard Oswald |
| 400 | 400 | 5,993 | 6,594 | 6,244 | 6,421 | -251 | 172 | |||||||
Hasso Plattner | 398 | 377 | 3,936 | 4,927 | 4,612 | 4,108 | -676 | 819 | ||||||||
Stefan Ries |
| 0 | 0 | 354 | 370 | 713 | 696 | -359 | -326 | |||||||
Sabine Bendiek | | 0 | | 0 | | 245 | | 258 | | 491 | | 488 | | -246 | | -230 |
Total |
| 797 | 777 | 12,393 | 14,153 | 16,265 | 15,819 | -3,872 | -1,665 | |||||||
Postcontractual Non-Compete Provisions
Each Executive Board member’s contract includes a 12-month postcontractual non-compete agreement. During this non-compete period, Executive Board members receive abstention payments corresponding to 50% of their average contractual compensation as members. This average is calculated on the basis of the preceding three years. Any other occupational income generated by the Executive Board member is deducted from their compensation. In accordance with the German Corporate Governance Code (GCGC), the Supervisory Board will offset any severance payments against such compensation for abstention.
The following table presents the hypothetical amounts for the net present values of the postcontractual non-compete abstention payments. The calculation assumes the following:
| - | The Executive Board member leaves SAP at the end of their respective current contract term. |
| - | Their final average contractual compensation prior to their departure equals their compensation in 2025. |
Actual postcontractual non-compete payments will likely differ from these amounts depending on the time of departure and the compensation levels and target achievements at the time of departure.
Net Present Values of the Postcontractual Non-Compete Abstention Payments
€ thousands | | Contract Term Expires | | Discount Rate (in %) | | Net Present Value |
Christian Klein (CEO) |
| 4/30/2030 |
| 3.22 |
| 7,081 |
Muhammad Alam |
| 3/31/2027 |
| 2.53 |
| 1,089 |
Dominik Asam |
| 3/6/2028 |
| 2.64 |
| 1,196 |
Thomas Saueressig |
| 10/31/2028 |
| 2.99 |
| 3,240 |
Sebastian Steinhaeuser (since 2/1/2025) |
| 1/31/2028 |
| 2.59 |
| 1,010 |
Gina Vargiu-Breuer |
| 1/31/2027 |
| 2.46 |
| 1,229 |
Total |
|
| 14,844 |
Early End-of-Service Undertakings
Severance Payments
The contracts for all Executive Board members provide that on termination before full term (for example, by the Company without cause where the member’s appointment is revoked, where the member becomes occupationally disabled, or in connection with a change of control), SAP SE will pay to the member the outstanding part of the compensation target for the entire remainder of the term, appropriately discounted for early payment. In accordance with section G.13 of the GCGC, payments made to an Executive Board member due to early termination must not exceed twice the annual total compensation. The annual total compensation is defined as the individual total target compensation comprised of the annual base salary and the two performance-based elements. The Supervisory Board may specify that Executive Board members are not entitled to such severance payment if they have not served SAP as a member of the Executive Board for at least one year.
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If an Executive Board member’s appointment to the Executive Board expires or ceases because of, or as a consequence of, change or restructuring, or due to a change of control, SAP SE and each Executive Board member has the right to terminate the employment contract within eight weeks of the occurrence by giving six months’ notice. A change of control is deemed to occur when:
| – | A third party is required to make a mandatory takeover offer to the shareholders of SAP SE under the German Securities Acquisition and Takeover Act; |
| – | SAP SE merges with another company and becomes the subsumed entity; |
| – | A control or profit transfer agreement is concluded with SAP SE as the dependent company. |
An Executive Board member’s contract can also be terminated before full term if their appointment as an Executive Board member of SAP SE is revoked in connection with a change of control.
Postcontractual Non-Compete Provisions
Abstention compensation for the postcontractual non-compete period as described above is also payable on early contract termination.
Permanent Disability
If an Executive Board member becomes permanently disabled, that member’s contract will end at the end of the quarter in which the permanent inability to work was determined. The Executive Board member will receive their monthly basic salary for a further 12 months starting from the date on which the permanent disability was determined.
Compensation of Former Executive Board Members in 2025
| LTI 2020 – | |
€ thousands | | Tranche 2022 |
Sabine Bendiek (until 12/31/2023) |
| 2,748 |
Luka Mucic (until 3/31/2023) |
| 1,803 |
Juergen Mueller (until 9/30/2024) |
| 2,984 |
Scott Russell (until 8/31/2024) |
| 3,794 |
Julia White (until 8/31/2024) |
| 4,659 |
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LTI Holdings of Former Executive Board Members in 2025
| | 1/1/2025 | | During the Year | | 12/31/2025 | |||||||
| | | | Exercised (E)/ | | | | Thereof Subject | |||||
Adjusted (A)/ | to Holding | ||||||||||||
Quantity in Share Units | Specification | Grant Date | Outstanding | Forfeited (F) | Outstanding | Period | |||||||
LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 1,652 | 0 | 1,652 | 1,652 | ||||||||
LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 1,652 | 0 | 1,652 | 1,652 | ||||||||
LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 1,652 | 0 | 1,652 | 1,652 | ||||||||
Sabine Bendiek | LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 4,303 | 2,152 | A | 6,455 | 6,455 | ||||||
(until 12/31/2023) | LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 4,303 | 238 | A | 4,541 | 4,541 | ||||||
| LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 4,303 | 0 | 4,303 |
|
| 4,303 | |||||
| LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 11,883 | -11,883 | E | 0 |
|
| 0 | ||||
| LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 9,521 | -9,521 | E | 0 |
|
| 0 | ||||
| LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 7,922 | -7,922 | E | 0 |
|
| 0 | ||||
| LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 543 | 0 | 543 |
|
| 543 | |||||
| LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 543 | 0 | 543 |
|
| 543 | |||||
| LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 543 | 0 | 543 |
|
| 543 | |||||
LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 2,824 | 1,412 | A | 4,236 | 4,236 | |||||||
LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 2,824 | 156 | A | 2,980 | 2,980 | |||||||
Luka Mucic |
| LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 2,824 | 0 | 2,824 |
|
| 2,824 | ||||
(until 3/31/2023) |
| LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 7,307 | -7,307 | E | 0 |
|
| 0 | |||
| LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 5,854 | -5,854 | E | 0 |
|
| 0 | ||||
| LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 4,871 | -4,871 | E | 0 |
|
| 0 | ||||
| LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 662 | 0 | 662 |
|
| 662 | |||||
| LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 1,104 | 0 | 1,104 |
|
| 1,104 | |||||
| LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 442 | 0 | 442 |
|
| 442 | |||||
LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 2,892 | 0 | 2,892 | 2,892 | ||||||||
LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 2,892 | 0 | 2,892 | 2,892 | ||||||||
Juergen Mueller | LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 2,892 | 0 | 2,892 | 2,892 | |||||||
(until 9/30/2024) | LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 4,672 | 2,336 | A | 7,008 | 7,008 | ||||||
LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 4,672 | 259 | A | 4,931 | 4,931 | |||||||
LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 4,672 | 0 | 4,672 | 4,672 | ||||||||
LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 9,574 | -9,574 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 7,671 | -7,671 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 6,382 | -6,382 | E | 0 | 0 | |||||||
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| | 1/1/2025 | | During the Year | | 12/31/2025 | |||||||
| | | | Exercised (E)/ | | | | Thereof Subject | |||||
Adjusted (A)/ | to Holding | ||||||||||||
Quantity in Share Units | Specification | Grant Date | Outstanding | Forfeited (F) | Outstanding | Period | |||||||
LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 1,005 | 0 | 1,005 | 1,005 | ||||||||
LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 1,675 | 0 | 1,675 | 1,675 | ||||||||
LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 670 | 0 | 670 | 670 | ||||||||
LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 3,613 | 0 | 3,613 | 3,613 | ||||||||
LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 3,613 | 0 | 3,613 | 3,613 | ||||||||
| LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 3,613 | 0 | 3,613 |
|
| 3,613 | |||||
| LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 5,941 | 2,971 | A | 8,912 |
|
| 8,912 | ||||
Scott Russell |
| LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 5,941 | 329 | A | 6,270 |
|
| 6,270 | |||
(until 8/31/2024) |
| LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 5,941 | 0 | 5,941 |
|
| 5,941 | ||||
| LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 11,232 | -11,232 | E | 0 |
|
| 0 | ||||
| LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 8,999 | -8,999 | E | 0 |
|
| 0 | ||||
LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 7,488 | -7,488 | E | 0 | 0 | |||||||
| LTI 2024 – Tranche 2024 – Market PSU | 3/12/2024 | 676 | 0 | 676 |
|
| 676 | |||||
| LTI 2024 – Tranche 2024 – Financial PSU | 3/12/2024 | 1,126 | 0 | 1,126 |
|
| 1,126 | |||||
| LTI 2024 – Tranche 2024 – ESG PSU | 3/12/2024 | 450 | 0 | 450 |
|
| 450 | |||||
| LTI 2020 – Tranche 2023 – Market PSU | 3/24/2023 | 3,120 | 0 | 3,120 |
|
| 3,120 | |||||
| LTI 2020 – Tranche 2023 – Financial PSU | 3/24/2023 | 3,120 | 0 | 3,120 |
|
| 3,120 | |||||
LTI 2020 – Tranche 2023 – RSU | 3/24/2023 | 3,120 | 0 | 3,120 | 3,120 | ||||||||
Julia White |
| LTI 2020 – Tranche 2022 – Market PSU | 3/28/2022 | 7,296 | 3,648 | A | 10,944 |
|
| 10,944 | |||
(until 8/31/2024) |
| LTI 2020 – Tranche 2022 – Financial PSU | 3/28/2022 | 7,296 | 404 | A | 7,700 |
|
| 7,700 | |||
| LTI 2020 – Tranche 2022 – RSU | 3/28/2022 | 7,296 | 0 | 7,296 |
|
| 7,296 | |||||
LTI 2020 – Tranche 2021 – Market PSU | 3/22/2021 | 11,925 | -11,925 | E | 0 | 0 | |||||||
LTI 2020 – Tranche 2021 – Financial PSU | 3/22/2021 | 9,554 | -9,554 | E | 0 | 0 | |||||||
| LTI 2020 – Tranche 2021 – RSU | 3/22/2021 | 7,950 | -7,950 | E | 0 |
|
| 0 | ||||
Total | 246,511 | -114,228 | 132,283 |
|
| 132,283 | |||||||
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Executive Board: Other Information
We did not grant any compensation advance or credit to, or enter into any commitment for the benefit of, any member of our Executive Board in 2025 or the previous year.
As far as the law permits, SAP SE and its affiliated companies in Germany and elsewhere indemnify and hold harmless their respective directors and officers against and from the claims of third parties. To this end, we maintain directors’ and officers’ (D&O) group liability insurance. The policy is annual and is renewed from year to year. The insurance covers the personal liability of the insured group for financial loss caused by its managerial acts and omissions. The current D&O policy includes an individual deductible for Executive Board members of SAP SE as required by section 93 (2) of the AktG.
Compensation for Supervisory Board Members
Compensation System
Supervisory Board members’ compensation is governed by section 16 of our Articles of Incorporation, which was amended by resolution of our Annual General Meeting of Shareholders on May 15, 2024, to adjust the compensation payable to the chairperson of the Supervisory Board.
Each member of the Supervisory Board receives, in addition to the reimbursement of their expenses, an annual basic compensation of € 165,000. The chairperson receives €600,000 and the deputy chairperson € 220,000 annually. In addition, we reimburse members of the Supervisory Board for the value-added tax payable on their compensation.
For membership of the Audit and Compliance Committee, Supervisory Board members receive an additional fixed annual compensation of €50,000, and for membership of any other Supervisory Board committee €35,000, provided that the committee concerned has met in the year. The chairperson of the Audit and Compliance Committee receives €95,000, and the chairpersons of the other committees receive €50,000. If a deputy chairperson is appointed to a committee, he or she receives €43,500 per year, and €72,500 per year for the Audit and Compliance Committee. The chairperson of the Supervisory Board shall not receive any additional compensation for chairing, or being a member of, any committees. The fixed remuneration is payable after the end of the year.
If the Supervisory Board appoints a Lead Independent Director, the Lead Independent Director shall receive compensation of €50,000 per year in addition to their basic compensation and in addition to their compensation for any memberships in committees.
Any members of the Supervisory Board who have served for less than the entire year receive one-twelfth of the annual compensation for each month of service commenced. This also applies to the increased compensation for the chairperson and the deputy chairperson(s) and to the compensation for the chairperson, any possible deputy chairperson, the members of a committee, and to the additional compensation for the Lead Independent Director.
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Supervisory Board Members’ Compensation in 2025
€ thousands | 2025 | 2024 | ||||||||||||||||||
Fixed | Compensation for | Total | Fixed | Compensation for | Total | |||||||||||||||
Compensation | % of Total | Committee Work | % of Total | Compensation | % of Total | Committee Work | % of Total | |||||||||||||
Dr. h. c. mult. Pekka Ala-Pietilä (Chairperson from 5/15/2024) | | 600 | | 100 | | 0 | | 0 | | 600 | | 400 | | 100 | | 0 | | 0 | | 400 |
Prof. Dr. h. c. mult. Hasso Plattner (Chairperson until 5/15/2024) |
| NA |
| NA |
| NA |
| NA |
| NA |
| 115 |
| 64 |
| 65 |
| 36 |
| 179 |
Lars Lamadé (Deputy Chairperson) |
| 220 |
| 76 |
| 70 |
| 24 |
| 290 |
| 220 |
| 69 |
| 99 |
| 31 |
| 319 |
Manuela Asche-Holstein (until 5/15/2024) |
| NA | NA | NA | NA | NA | 69 | 58 | 50 | 42 | 119 | |||||||||
Jakub Černý (from 5/15/2024) |
| 165 |
| 70 |
| 70 |
| 30 |
| 235 |
| 110 |
| 70 |
| 47 |
| 30 |
| 157 |
Pascal Demat (from 5/15/2024) |
| 165 |
| 70 |
| 70 |
| 30 |
| 235 |
| 110 |
| 70 |
| 47 |
| 30 |
| 157 |
Aicha Evans |
| 165 |
| 58 |
| 120 |
| 42 |
| 285 |
| 165 |
| 54 |
| 139 |
| 46 |
| 304 |
Andreas Hahn (from 5/15/2024) |
| 165 |
| 70 |
| 70 |
| 30 |
| 235 |
| 110 |
| 70 |
| 47 |
| 30 |
| 157 |
Prof. Dr. Ralf Herbrich (from 5/15/2024) |
| 165 |
| 70 |
| 70 |
| 30 |
| 235 |
| 110 |
| 70 |
| 47 |
| 30 |
| 157 |
Margret Klein-Magar |
| 165 |
| 66 |
| 85 |
| 34 |
| 250 |
| 165 |
| 62 |
| 100 |
| 38 |
| 265 |
Monika Kovachka-Dimitrova (until 5/15/2024) |
| NA |
| NA |
| NA |
| NA |
| NA |
| 69 |
| 61 |
| 44 |
| 39 |
| 112 |
Peter Lengler (until 5/15/2024) |
| NA |
| NA |
| NA |
| NA |
| NA |
| 69 |
| 52 |
| 65 |
| 48 |
| 133 |
Jennifer Xin-Zhe Li |
| 165 |
| 56 |
| 130 |
| 44 |
| 295 |
| 165 |
| 56 |
| 130 |
| 44 |
| 295 |
Dr. Qi Lu |
| 165 |
| 83 |
| 35 |
| 18 |
| 200 |
| 165 |
| 72 |
| 64 |
| 28 |
| 229 |
César Martin (from 5/15/2024) | 165 | 66 | 85 | 34 | 250 | 110 | 66 | 57 | 34 | 167 | ||||||||||
Gerhard Oswald | 165 | 58 | 120 | 42 | 285 | 165 | 51 | 155 | 49 | 320 | ||||||||||
Christine Regitz (until 5/15/2024) | NA | NA | NA | NA | NA | 69 | 59 | 47 | 41 | 116 | ||||||||||
Dr. h. c. Punit Renjen (until 5/15/2024) | NA | NA | NA | NA | NA | 92 | 75 | 31 | 25 | 122 | ||||||||||
Dr. Friederike Rotsch | 165 | 43 | 220 | 57 | 385 | 165 | 40 | 244 | 60 | 409 | ||||||||||
Nicolas Sabatier (from 5/15/2024) | 165 | 70 | 70 | 30 | 235 | 110 | 70 | 47 | 30 | 157 | ||||||||||
Dr. Eberhard Schick (from 5/15/2024) | 165 | 66 | 85 | 34 | 250 | 110 | 66 | 57 | 34 | 167 | ||||||||||
Heike Steck (until 5/15/2024) |
| NA |
| NA |
| NA |
| NA |
| NA |
| 69 |
| 54 |
| 58 |
| 46 |
| 127 |
Helmut Stengele (until 5/15/2024) |
| NA |
| NA |
| NA |
| NA |
| NA |
| 69 |
| 100 |
| 0 |
| 0 |
| 69 |
Nina Straßner (from 5/15/2024) |
| 165 |
| 58 |
| 120 |
| 42 |
| 285 |
| 110 |
| 58 |
| 80 |
| 42 |
| 190 |
Dr. Rouven Westphal |
| 165 |
| 58 |
| 120 |
| 42 |
| 285 |
| 165 |
| 54 |
| 143 |
| 46 |
| 308 |
Dr. Gunnar Wiedenfels |
| 165 | 56 | 131 | 44 | 296 | 165 | 53 | 147 | 47 | 312 | |||||||||
James Wright (until 5/15/2024) | NA | NA | NA | NA | NA | 69 | 52 | 65 | 48 | 133 | ||||||||||
Total |
| 3,460 |
|
| 1,671 |
|
| 5,131 |
| 3,507 |
|
| 2,071 |
|
| 5,579 | ||||
In 2025, we received services from members of the Supervisory Board (including services from employee representatives on the Supervisory Board in their capacity as employees of SAP) in the amount of € 2,129,000 (2024: €1,987,000).
Long-Term Incentives for the Supervisory Board
We do not offer members of the Supervisory Board share-based payment for their Supervisory Board work. Any share-based payment awards received by employee-elected members relate to their position as SAP employees and not to their work on the Supervisory Board.
Supervisory Board: Other Information
In 2023, SAP granted a loan within the SAP-Flex Loan program for its employees, amounting to €5,000 to one of the employees who later joined the Supervisory Board as an employee representative in 2024. Besides this loan, SAP did not grant any compensation advance or credit to, or enter into any commitment for the benefit of, any member of its Supervisory Board in 2025 or the previous year.
As far as the law permits, we indemnify Supervisory Board members against, and hold them harmless from, claims brought by third parties. To this end, we maintain directors’ and officers’ (D&O) group liability insurance. In accordance with our Articles of Incorporation, the premiums for the insurance policy are paid by SAP.
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Comparative Information on the Change of Compensation and Company Performance
The following table discloses the relative change in compensation of active and former Executive Board and Supervisory Board members, the average compensation of all SAP employees (full-time equivalents), and year-over-year changes in selected earnings indicators. The compensation awarded and due to Executive Board members is presented in accordance with section 162 of the AktG.
The presentation of average employee compensation is based on the average full-time equivalent number of employees in the respective year. Average employee compensation comprises the personnel expenses for salaries, fringe benefits, employer contributions to social insurance, and any short-term and long-term variable compensation components attributable to the fiscal year. Therefore, employee compensation is also equivalent to compensation awarded and due within the meaning of section 162 of the AktG and is thus in line with Executive Board and Supervisory Board compensation.
| 2021 to 2020 | | 2022 to 2021 | | 2023 to 2022 | | 2024 | | 2024 to 2023 | | 2025 | | 2025 to 2024 |
| |
Change in % | Change in % | Change in % | € thousands | Change in % | € thousands | Change in % | |||||||||
Current Supervisory Board Members |
| |
| |
| |
| |
| |
| |
| | |
Dr. h. c. mult. Pekka Ala-Pietilä (member from 5/3/2002 until 5/12/2021, Chairperson from 5/15/2024) |
| -58 |
| NA |
| NA |
| 400 |
| NA |
| 600 |
| 50 | |
Lars Lamadé (Deputy Chairperson from 1/1/2022) |
| 6 |
| 64 |
| 0 |
| 319 |
| -2 |
| 290 |
| -9 | |
Jakub Černý (from 5/15/2024) |
| NA |
| NA |
| NA |
| 157 |
| NA |
| 235 |
| 50 | |
Pascal Demat (from 5/15/2024) |
| NA |
| NA |
| NA |
| 157 |
| NA |
| 235 |
| 50 | |
Aicha Evans |
| 6 |
| 52 |
| 0 |
| 304 |
| -5 |
| 285 |
| -6 | |
Andreas Hahn (from 5/15/2024) |
| NA |
| NA |
| NA |
| 157 |
| NA |
| 235 |
| 50 | |
Prof. Dr. Ralf Herbrich (from 5/15/2024) |
| NA |
| NA |
| NA |
| 157 |
| NA |
| 235 |
| 50 | |
Margret Klein-Magar (Deputy Chairperson until 12/31/2021) |
| 4 |
| 10 |
| 0 |
| 265 |
| -7 |
| 250 |
| -6 | |
Jennifer Xin-Zhe Li (from 5/18/2022) |
| NA |
| NA |
| 63 |
| 295 |
| 0 |
| 295 |
| 0 | |
César Martin (from 5/15/2024) | NA | NA | NA | 167 | NA | 250 | 50 | ||||||||
Dr. Qi Lu (from 12/21/2020) | 1,288 | 41 | 0 | 229 | -15 | 200 | -13 | ||||||||
Gerhard Oswald | -3 | 24 | 16 | 320 | 0 | 285 | -11 | ||||||||
Dr. Friederike Rotsch | 8 | 44 | 15 | 409 | 6 | 385 | -6 | ||||||||
Nicolas Sabatier (from 5/15/2024) | NA | NA | NA | 157 | NA | 235 | 50 | ||||||||
Dr. Eberhard Schick (from 5/15/2024) | NA | NA | NA | 167 | NA | 250 | 50 | ||||||||
Nina Straßner (from 5/15/2024) | NA | NA | NA | 190 | NA | 285 | 50 | ||||||||
Dr. Rouven Westphal (from 5/12/2021) | NA | 133 | -4 | 308 | 0 | 285 | -8 | ||||||||
Dr. Gunnar Wiedenfels | 0 | 52 | -3 | 312 | 4 | 296 | -5 | ||||||||
Current Executive Board Members | |||||||||||||||
Christian Klein (CEO) | 425 | -20 | 53 | 18,983 | 165 | 16,244 | -14 | ||||||||
Muhammad Alam (from 4/1/2024) | NA | NA | NA | 1,936 | NA | 2,246 | 16 | ||||||||
Dominik Asam (from 3/7/2023) | NA | NA | NA | 3,281 | -17 | 2,531 | -23 | ||||||||
Thomas Saueressig | 307 | -41 | 109 | 8,241 | 128 | 7,044 | -15 | ||||||||
Sebastian Steinhaeuser (from 2/1/2025) | NA | NA | NA | NA | NA | 2,131 | NA | ||||||||
Gina Vargiu-Breuer (from 2/1/2024) | NA | NA | NA | 2,109 | NA | 2,524 | 20 | ||||||||
Former Supervisory Board Members | |||||||||||||||
Prof. Dr. h. c. mult. Hasso Plattner (Chairperson until 5/15/2024) | 1 | 27 | -2 | 179 | -58 | NA | NA | ||||||||
Manuela Asche-Holstein (from 7/8/2021 until 5/15/2024) | NA | 200 | 11 | 119 | -58 | NA | NA | ||||||||
Monika Kovachka-Dimitrova (until 5/15/2024) | 1 | 42 | 0 | 113 | -58 | NA | NA | ||||||||
Prof. Dr. Gesche Joost (until 5/11/2023) | 0 | 26 | -58 | NA | NA | NA | NA | ||||||||
Peter Lengler (from 8/10/2021 until 5/15/2024) | NA | 255 | 0 | 133 | -53 | NA | NA | ||||||||
Christine Regitz (until 5/15/2024) | 5 | 34 | 0 | 116 | -58 | NA | NA | ||||||||
Dr. h. c. Punit Renjen (from 5/11/2023 until 5/15/2024) | NA | NA | NA | 122 | -44 | NA | NA | ||||||||
Heike Steck (until 5/15/2024) | 9 | 32 | 0 | 127 | -53 | NA | NA | ||||||||
Helmut Stengele (from 10/29/2021 until 5/15/2024) | NA | 300 | 0 | 69 | -58 | NA | NA | ||||||||
James Wright (until 5/15/2024) | 0 | 40 | 0 | 133 | -53 | NA | NA | ||||||||
Former Executive Board Members |
| ||||||||||||||
Sabine Bendiek (until 12/31/2023) |
| NA |
| -65 |
| 43 |
| 6,241 |
| 209 |
| 2,748 |
| -56 | |
Luka Mucic (until 3/31/2023) |
| 127 |
| -25 |
| 258 |
| 4,041 |
| -65 |
| 1,803 |
| -55 | |
Juergen Mueller (until 9/30/2024) | 307 | 10 | 14 | 7,144 | 96 | 2,984 | -58 | ||||||||
Gerhard Oswald (until 12/31/2016) | 0 | 0 | 10 | 400 | 6 | 400 | 0 | ||||||||
Scott Russell (until 8/31/2024) | NA | 2 | 35 | 21,459 | 598 | 3,794 | -82 | ||||||||
Julia White (until 8/31/2024) | NA | -45 | 12 | 17,103 | 569 | 4,659 | -73 | ||||||||
Earnings Indicators1 | |||||||||||||||
Total Revenue SAP Group (IFRS, in € millions) | 2 | 11 | 6 | 34,176 | 10 | 36,800 | 8 | ||||||||
Total Revenue SAP SE (German Commercial Code, in € millions) | 5 | 16 | 7 | 21,412 | 13 | 22,914 | 7 | ||||||||
Operating Profit SAP Group (Non-IFRS, in € millions)2 | -1 | -2 | 9 | 8,153 | 25 | 10,419 | 28 | ||||||||
Net Income SAP SE (German Commercial Code, in € millions) | 8 | -29 | 149 | 366 | -92 | 7,107 | 1,842 | ||||||||
Average annual compensation of employees SAP Group3 |
| 13 |
| 4 |
| 12 |
| 184 |
| 18 |
| 146 |
| -21 |
1 SAP Group (non-IFRS) 2020 from continuing and discontinued operations
2 Operating profit (non-IFRS) 2020 to 2022 based on non-IFRS metrics published in the Integrated Report 2023
3 The 2024 average was impacted by restructuring expenses of €3.1 billion associated with the 2024 transformation program. Not considering this effect, the increase in average annual compensation of the employees from 2023 to 2024 would be 1% and the decrease from 2024 to 2025 would be 6%
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Employees
Headcount and Personnel Expense
Numbers disclosed in the Employees section are based on headcount (exceptions in FTE are indicated). FTE is a key metric that indicates the staffing percentage of an employee in a position based on the number of hours they work per week in a position, compared with a full-time employee. Headcount in FTEs refers to the total number of FTEs as at the last day of the reporting period. An employee working half-time counts as 0.5 FTEs. Only headcount-relevant employees are included in FTE figures. In general, this includes all active employees on permanent contracts, and employees on contracts of more than six months. Students, and employees on long-term leave, are excluded.
| 2025 | 2024 | ||||||
Number of Employees | Number of Employees | Number of Employees | Number of Employees | |||||
Gender | (headcount) | (full-time equivalent) | (headcount) | (full-time equivalent) | ||||
Male |
| 71,503 | 71,340 | 71,007 | 70,823 | |||
Female |
| 39,891 | 39,307 | 38,965 | 38,298 | |||
Other |
| 1 | 1 | 1 | 1 | |||
Not reported |
| 2 | 2 | 0 | 0 | |||
Total employees |
| 111,397 | 110,650 | 109,973 | 109,121 | |||
For more information about restructuring activities, see the Notes to the Consolidated Financial Statements, Note (B.6). For more information about employee compensation and a breakdown of personnel expense, see the Notes to the Consolidated Financial Statements, Note (B.1) and Note (B.2).
Employee and Labor Relations
On a worldwide basis, we believe that our employee and labor relations are excellent.
On a corporate level, all employees of SAP in the member states of the European Union and in the contract states of the European Economic Area are represented by the SAP SE Works Council (WoC) (Europe). By law and agreement with SAP, the SAP SE WoC (Europe) is entitled to receive information on certain transnational matters and to consult with the Executive Board or a representative thereof. On the legal entity level, the SAP SE works council (Germany) represents the employees of SAP SE. The employees of SAP Deutschland SE & Co. KG (SAP Germany), Concur (Germany) GmbH, and Emarsys Interactive Services GmbH (Germany) are represented by separate works councils. Other employee representatives include the group works council (composed of members of the works councils of SAP SE, SAP Germany, Concur (Germany) GmbH and Emarsys Interactive Services GmbH (Germany)), the representatives of severely disabled persons in SAP SE and SAP Germany and the spokespersons committee as the representation of the executives of SAP SE (Germany).
Employees of each of SAP France, SAP France Holding, SAP Labs France and Concur (France) SAS are subject to the same collective agreement: “SYNTEC”. In France, effective December 31, 2019 the Workers Council, the Health and Safety Committee and the employee representative were replaced by a single instance named the “Economic and Social Committee”. Today, SAP France/SAP France Holding (in the same legal entity), SAP Labs France and Concur (France) SAS are represented by an Economic and Social Committee. The represented unions negotiate agreements with each of SAP France/SAP France Holding and SAP Labs France. For Concur (France) SAS the agreements are negotiated with the Economic and Social Committee. In addition, the employees of various other SAP entities, including SAP Digital HUB (SAP EMEA Inside Sales S.L.), SAP Österreich GmbH (Austria), SAP España – Sistemas, Aplicaciones y Productos en la Informática, S.A., SAO D.O.O. (Croatia), SAP Belgium NV/SA., SAP Israel, SAP Nederland B.V., SAP Italia Sistemi Applicazioni Prodotti in Data Processing S.p.A., SAP China Beijing Branch, all entities in the Czech Republic (SAP ČR, spol. s r.o., SAP Services s.r.o., Ariba Czech s.r.o. and Concur Czech (s.r.o.)), SAP Brasil Ltda, SAP Korea Ltd. (Korea), SAP North West Africa Ltd. (Maroc), SAP Slovensko s.r.o. (Slovakia), SAP sistemi, aplikacije in produkti za obdelavo podatkov d.o.o. (Slovenia), SAP Romania SRL, SAP Svenska Aktiebolag (Sweden), SAP UK Ltd., and SAP Ireland Ltd. are represented by works councils, worker representatives, employee consultation forums and/or unions. In addition, some of these employees are subject to a collective bargaining agreement.
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Share Ownership
Beneficial Ownership of Shares
The ordinary shares beneficially owned by the persons listed in “Item 6. Directors, Senior Management and Employees — Compensation Report” are disclosed in “Item 7. Major Shareholders and Related-Party Transactions — Major Shareholders.”
Share-Based Compensation Plans
Share- Based Compensation
We maintain certain share-based compensation plans. The share-based compensation from these plans result from cash-settled and equity-settled awards issued to employees. For more information on our share-based compensation plans refer to “Item 6. Directors, Senior Management and Employees — Compensation Report” and Note (B.3) to our Consolidated Financial Statements.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED-PARTY TRANSACTIONS
Major Shareholders
The share capital of SAP SE consists of ordinary shares, which are issued only in bearer form. Accordingly, SAP SE generally cannot determine the identity of its shareholders or how many shares a particular shareholder owns. SAP’s ordinary shares are traded in the United States by means of ADRs. Each ADR currently represents one SAP SE ordinary share. On February 5, 2026, based on information provided by the Depositary there were 77,900,591 ADRs held of record by 587 registered holders. The ordinary shares underlying such ADRs represented 6.34% of the then-outstanding ordinary shares (including treasury stock). Because SAP’s ordinary shares are issued in bearer form only, we are unable to determine the number of ordinary shares directly held by persons with U.S. addresses.
The following table sets forth certain information regarding the beneficial ownership of the ordinary shares to the extent known to SAP as of February 5, 2026 of: (i) each person or group known by SAP SE to own beneficially 5% or more of the outstanding ordinary shares; and (ii) the beneficial ownership of all individuals who are currently members of the Supervisory Board and all members of the Executive Board, individually and as a group, in each case as reported to SAP SE by such persons. There was, as far as we are able to tell given the nature of our shares, no significant change in the percentage ownership held by any major shareholder during the past three years. None of the major shareholders have special voting rights.
Major Shareholders
Ordinary Shares Beneficially Owned | ||||
| | Number | | % of Outstanding |
Dietmar Hopp, collectively1 |
| 62,548,065 | 5.1 | |
Executive Board Members as a group (6 persons) |
| 60,079 | 0.0 | |
Supervisory Board Members as a group (18 persons) |
| 23,247 | 0.0 | |
Executive Board Members and Supervisory Board Members as a group (24 persons)2 |
| 83,326 | 0.0 | |
BlackRock, Inc.3 |
| 76,782,227 | 6.3 | |
1 The foregoing information is based on a Schedule 13G filed by Dietmar Hopp and other affiliated persons and companies on February 11, 2022.
2 We believe that each of the members of the Supervisory Board and the Executive Board beneficially owns less than 1% of SAP SE’s ordinary shares as of February 5, 2026.
3 As required under German law, BlackRock, Inc. informed SAP that they own more than 5% of SAP’s outstanding ordinary shares. BlackRock, Inc. is not required to provide SAP with the number of shares owned as of February 5, 2026, and has not provided such information. The foregoing information is based on a Schedule 13G filed by BlackRock, Inc. on February 2, 2024.
Currently we are not aware of any arrangements, the operation of which may, at a subsequent date, result in a change in control of the company.
Related-Party Transactions
For information on related-party transactions see Note (G.6) to our Consolidated Financial Statements.
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ITEM 8. FINANCIAL INFORMATION
Consolidated Financial Statements and Financial Statement Schedule
See “Item 18. Financial Statements” and pages F-1 through F-110.
Other Financial Information
Legal Proceedings
We are subject to a variety of legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business, including claims and lawsuits involving businesses we have acquired.
Refer to Note (G.3) to our Consolidated Financial Statements for a detailed discussion of our material legal proceedings.
Dividend Policy
For more information on dividend policy see the disclosure in “Item 3. Key Information — Dividends”.
Significant Changes
Supervisory Board and Committee Changes
Effective January 1, 2026, Marielle Ehrmann was appointed to the Supervisory Board and its Finance and Investment Committee and Product and Technology Committee.
Effective January 1, 2026, Supervisory Board member Jakub Černý left the Product and Technology Committee and was appointed to the Audit and Compliance Committee.
Effective January 1, 2026, Margret-Klein Magar left the Supervisory Board and its Audit and Compliance Committee and Personnel and Governance Committee.
Effective January 1, 2026, Nina Strassner left the Finance and Investment Committee and joined the People and Governance Committee.
New Share Repurchase Program
Following SAP’s strong free cash flow generation, the Executive Board and the Supervisory Board have authorized a new share repurchase program with a volume of up to €10 billion. The program started in February 2026 and is expected to be completed by the end of 2027. The program was implemented based on the authorization granted by the Annual General Meeting of SAP SE on May 11, 2023, and in compliance with the restrictions set forth therein.
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ITEM 9. THE OFFER AND LISTING
Our ordinary shares are officially listed on the Frankfurt Stock Exchange, the Berlin Stock Exchange and the Stuttgart Stock Exchange. The principal trading market for the ordinary shares is Xetra, the electronic dealing platform of Deutsche Boerse AG.
ADRs representing SAP SE ordinary shares are listed on the NYSE under the symbol “SAP,” and currently each ADR represents one ordinary share.
ITEM 10. ADDITIONAL INFORMATION
Articles of Incorporation
Organization and Register
SAP SE is a European Company (Societas Europaea, or “SE”) duly established under the laws of Germany and the European Union, registered in the Commercial Register (Handelsregister) at the Lower Court of Mannheim, Germany, under the entry number “HRB 719915.” SAP SE publishes its official notices in the Company Register (www.unternehmensregister.de) and Federal Gazette (www.bundesanzeiger.de).
Objects and Purposes
SAP’s Articles of Incorporation state that our objects involve, directly or indirectly, the development, production and marketing of products and the provision of services in the field of information technology and telecommunication, particularly in the following fields:
- | developing and marketing integrated product and service solutions for e-commerce; |
- | developing software and cloud solutions and the licensing of their use to others; |
- | organization and deployment consulting, as well as user training, for software and cloud solutions; |
- | selling, leasing, renting and arranging the procurement and provision of all other forms of use of information technology systems and relevant accessories; and |
- | making capital investments in enterprises active within the scope of the corporate purpose to promote the opening and advancement of international markets in these fields. |
SAP is authorized to act in all the business areas listed above and to delegate such activities to affiliated entities within the meaning of the German Stock Corporation Act; in particular SAP is authorized to delegate its business in whole or in part to such entities. SAP SE is authorized to establish branch offices in Germany and other countries, as well as to form, acquire or invest in other companies of the same or related kind and to enter into collaboration and joint venture agreements. SAP is further authorized to invest in enterprises of all kinds principally for investment purposes. SAP is authorized to dispose of investments, to consolidate the management of enterprises in which it participates, to enter into affiliation agreements with such entities, or to limit its activities to manage its shareholdings.
Corporate Governance
Introduction
SAP SE, as a European Company with a two-tier board system, is governed by three separate bodies: the Supervisory Board, the Executive Board and the Annual General Meeting of Shareholders. Their rules are defined by European and German law, by the Agreement on the Involvement of Employees in SAP SE (“Employee Involvement Agreement”, “EIA”), by the German Corporate Governance Code and by SAP’s Articles of Incorporation (Satzung) and are summarized below. See “Item 16G. Differences in Corporate Governance Practices” for additional information on our corporate governance practices.
The Supervisory Board
The Supervisory Board appoints and removes the members of the Executive Board and oversees and advises the management of the corporation. At regular intervals it meets to discuss current business as well as business development and planning. The SAP Executive Board must consult with the Supervisory Board concerning the corporate strategy, which is developed by the Executive Board. Types of transactions for which the Executive Board requires the Supervisory Board’s consent are listed in the Articles of Incorporation; in addition, the Supervisory Board has specified further types of transactions that require its consent. Accordingly, the Supervisory Board must also approve the annual budget of SAP upon submission by the Executive Board and certain subsequent deviations from the approved budget. The Supervisory Board is also responsible for representing SAP SE in transactions between SAP SE and Executive Board members.
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The Supervisory Board, based on a recommendation by its Audit and Compliance Committee, provides its proposal for the election of the external independent auditor to the Annual General Meeting of Shareholders. Based on the preparatory work of the Audit and Compliance Committee, the Supervisory Board deliberates and resolves on the adoption of the SAP SE financial statements and is responsible for the approval of the SAP SE financial statements, the consolidated financial statements, and the combined management report (including the Group Sustainability Statement). The Supervisory Board is also responsible for monitoring the auditor’s independence and the audit quality, a task it has delegated to the Audit and Compliance Committee.
Pursuant to Article 40 (3) sentence 1 of the SE Regulation, the number of members of the supervisory board and the rules for determining this number are to be laid down in the Articles of Incorporation. Furthermore, pursuant to Section 17 (1) SE-AG, the size of supervisory boards of companies which, like SAP SE, have a capital stock exceeding €10,000,000, is limited to twenty - one members. In line with these provisions as well as the EIA, the Articles of Incorporation of SAP SE provide that the Supervisory Board shall be composed of eighteen members.
The current Supervisory Board of SAP SE consists of eighteen members, nine of whom are elected by the Annual General Meeting of Shareholders as shareholders’ representatives with the remaining nine being appointed as employees’ representatives by the SE Works Council in accordance with the EIA (see below for details). The SE Works Council represents the SAP employees in member states of the European Union and in the contract states of the European Economic Area. Pursuant to Section 17(2) SE-AG, the Supervisory Board of SAP SE must have a minimum of 30% men and 30% women. This quota for the Supervisory Board must be observed for any new appointment to the Supervisory Board. To meet the minimum 30% quota, at least five out of 18 members must be women (as 30% of 18 is 5.4, which may be mathematically rounded down to five persons pursuant to applicable law). During all of 2025, there were three women on the shareholder representatives’ side and two women on the employee representatives’ side of the Supervisory Board. Thus, the percentage of women on the Supervisory Board reached the minimum quota of 30% throughout 2025.
The procedure for the appointment of the employee representatives on the Supervisory Board of SAP SE is governed by the EIA, as amended from time to time. In accordance with the EIA, for the current composition of the Supervisory Board, the nine seats reserved for employees’ representatives (“Employee Seats”) are allocated as follows: the first seven of the Employee Seats are allocated in proportion to the numbers of SAP employees employed in the individual countries (d`Hondt method), provided that if the first six seats are allocated to one country, the seventh seat is for the country with the second highest number of SAP employees. The eighth seat is allocated to the country represented in the SE Works Council with the highest number of SAP employees. The ninth seat is allocated to a country not already allocated a seat in the Supervisory Board but represented on the SE Works Council.
Following regular elections of the employee representatives in 2024, which were based on a temporary amendment of the EIA regarding the fifth and sixth seats, the composition of the Employee Seats changed with effect from the close of the Annual General Meeting of Shareholders on May 15, 2024, and was as follows until year - end 2025: The first four seats were determined by direct vote by all SAP employees with their principal place of employment in Germany. The employee representatives for the fifth and sixth seats were appointed by the SE Works Council from candidates nominated by the trade unions represented at the SAP entities in the European Economic Area. The seventh seat was allocated to the Czech Republic and determined according to applicable provisions of Czech law. With regard to the eighth and ninth seats, members of the SE Works Council from Germany and Spain were appointed by the SE Works Council as employees’ representatives.
Any Supervisory Board member elected by the shareholders at the Annual General Meeting of Shareholders may be removed by three-quarters of the votes cast at the Annual General Meeting of Shareholders. Any Supervisory Board member appointed in accordance with the EIA may be removed by the SE Works Council upon application by the body that nominated the respective employees’ representative for appointment by the SE Works Council or, in case the employees’ representative was directly elected, by the majority of the employees entitled to vote.
The Supervisory Board elects a chairperson and one or two deputy chairperson(s) among its members by a majority of the votes cast. Only a shareholders’ representative may be elected as chairperson of the Supervisory Board. When electing the chairperson of the Supervisory Board, the oldest member in terms of age of the shareholders’ representatives on the Supervisory Board will chair the meeting and, in the event of a tied vote, will have the casting vote.
Unless otherwise mandatorily prescribed by law or the Articles of Incorporation, resolutions of the Supervisory Board are adopted by simple majority of the votes cast. In the event of a tie, the vote of the chairperson and, if the chairperson does not participate in passing the resolution, the vote of the deputy chairperson, provided that he or she is a shareholders’ representative, will be decisive (casting vote).
Other than for the employees’ representatives on the first Supervisory Board of SAP SE, the Supervisory Board members may be elected or appointed for a period ending with the close of the Annual General Meeting of Shareholders at which the acts of the Supervisory Board are formally approved for the fourth fiscal year following the commencement of the term of office, not counting the year in which their term of office commences. In any event, the term of office shall end after six years at most. Re-election is possible. Our Supervisory Board holds four ordinary meetings per year and in addition convenes extraordinary meetings as needed or resolves by way of circular resolution. The compensation of the members of the Supervisory Board is set in the Articles of Incorporation.
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All of the shareholder representatives are considered independent from SAP and the Supervisory Board. This follows the German Corporate Governance Code (GCGC), which stipulates that an adequate number of the shareholder representatives on our Supervisory Board be independent. To be considered for appointment to the Supervisory Board and for as long as they serve, members must comply with certain criteria concerning independence, conflicts of interest and multiple memberships of management, and supervisory and other governing bodies. They must be loyal to SAP in their conduct and must not accept any position in companies that are in competition with SAP. Members are subject to insider trading prohibitions and the respective directors’ dealing rules of the European Regulation (EU) No 596/2014 of the European Parliament and the Council of 16 April 2014 on market abuse and the German Securities Trading Act. A member of the Supervisory Board may not vote on matters relating to certain contractual agreements between such member and SAP SE. Further, as the compensation of the Supervisory Board members is set in the Articles of Incorporation, Supervisory Board members are unable to vote on their own compensation, with the exception that they are able to exercise voting rights in an Annual General Meeting of Shareholders in connection with a resolution amending the Articles of Incorporation.
The duties and procedures of the Supervisory Board and its committees are specified in their respective rules of procedure, if any, which reflect the requirements of European and German law, including the SE Regulation and the German Stock Corporation Act, the Articles of Incorporation and the recommendations of the GCGC.
According to the provisions of the Sarbanes-Oxley Act, SAP does not grant loans to the members of the Executive Board or the Supervisory Board.
The Supervisory Board may appoint committees from among its members and may, to the extent permitted by law, entrust such committees with the authority to make decisions on behalf of the Supervisory Board. Currently the Supervisory Board maintains the following committees:
The Audit and Compliance Committee
The Audit and Compliance Committee (Prüfungs- und Compliance-Ausschuss) handles matters concerning the financial statements and the auditing of the Group and SAP SE standalone accounting and reporting. Additionally, the Audit and Compliance Committee handles all investigative compliance related topics and the external reporting of the Group. Among the tasks of the Audit and Compliance Committee are the discussion of SAP’s quarterly statements, half year report and the year-end financial and sustainability reporting prepared under German and U.S. regulations, including this report. The Audit and Compliance Committee recommends to the Supervisory Board the appointment of the external independent auditor, determines focus audit areas, discusses critical accounting policies and estimates with the auditors, reviews the audit reports issued and audit issues identified by the auditor, and monitors the effectiveness of the internal audit function and receives regular reports about the function’s resources, audit plans (including the criteria used to create the plans), its audit methods and activities, and audit results. The Audit and Compliance Committee also negotiates the audit fees with the auditor and monitors the auditor’s independence and audit quality. SAP’s Office of Ethics and Compliance, SAP Global Legal, and SAP’s Global Security & Cloud Compliance Office reports regularly to the Audit and Compliance Committee, as well as upon request and the occurrence of certain findings. The Audit and Compliance Committee reviews the effectiveness of SAP’s system for monitoring corporate security, which includes cybersecurity, with a focus on risk and incident management and mitigation. Finally, the Audit and Compliance Committee reviews the compensation report and prepares a recommendation for Supervisory Board to adapt and release the report for the respective fiscal year.
The Audit and Compliance Committee has established procedures regarding the approval of all audit and non-audit services provided by our external independent auditor. See “Item 16C. Principal Accountant Fees and Services” for details.
The Audit and Compliance Committee also does preparatory work for the full Supervisory Board’s deliberations and resolutions on the adoption of the annual financial statements, the approval of the consolidated annual financial statements and the Integrated Report. Additionally, the Audit and Compliance Committee assists in the preparation of the compensation report by reviewing it with regard to the fulfillment of all regulatory requirements.
The Supervisory Board has determined each of Jennifer Xin-Zhe Li, the Audit and Compliance Committee’s chairperson, and Dr. Gunnar Wiedenfels to be an audit committee financial expert as defined by the regulations of the SEC issued under Section 407 of the Sarbanes-Oxley Act as well as financial experts as defined by the German Stock Corporation Act, with both of them having expertise in the fields of accounting and auditing. Each of Ms. Li and Dr. Wiedenfels are “independent”, as such term is defined in Rule 10A-3 under the Exchange Act. See “Item 16A. Audit Committee Financial Expert” for details.
The Personnel and Governance Committee
The Personnel and Governance Committee (Personal- und Governance-Ausschuss) is responsible for personnel matters related to the Executive Board and matters concerning the coordination of the Supervisory Board. The Committee carries out the preparatory work necessary for key decisions made by the Supervisory Board concerning the members of the Executive Board, e.g. appointment and remuneration, as well as conclusion of, amendments to, and termination of Executive Board members’ service contracts and succession planning. The Committee also handles all matters related to corporate governance.
The German Stock Corporation Act prohibits the Personnel and Governance Committee from deciding on the compensation of the Executive Board members on behalf of the Supervisory Board and requires that such decision is made by the entire Supervisory Board. This Act also provides the Annual General Meeting of Shareholders with the right to vote on the system for the compensation of Executive Board members, such vote, however, not being legally binding for the Supervisory Board.
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The Finance and Investment Committee
The Finance and Investment Committee (Finanz- und Investitionsausschuss) addresses general financing issues and is responsible for all matters related to financing, mergers & acquisitions, joint ventures, strategic investments and divestitures. Furthermore, it regularly discusses acquisitions of intellectual property and companies, venture capital investments and other investments with the Executive Board and reports to the Supervisory Board on such investments. It is also responsible for the approval of such investments if the individual investment amount exceeds certain specified limits, as well as for the preparation of the full Supervisory Board’s resolution to approve the group annual financial plan. In addition, it discusses the Supervisory Board's annual proposal to the Annual General Meeting of Shareholders regarding the appropriation of profits and adopts a corresponding recommendation to the full Supervisory Board.
The Product and Technology Committee
The Product and Technology Committee (Produkt- und Technologieausschuss) advises the Executive Board with regard to the development and use of technologies and the development of software product strategy. It also covers all go to market related matters. SAP’s Global Security & Cloud Compliance Office reports regularly to the Product and Technology Committee, as well as upon request and the occurrence of certain findings.
The Nomination Committee
The Nomination Committee (Nominierungsausschuss) is exclusively composed of shareholder representatives. The purpose of this Committee is to propose suitable candidates for the Supervisory Board to recommend when the Annual General Meeting of Shareholders elects Supervisory Board members.
The Government Security Committee
The Government Security Committee (Ausschuss für staatliche Sicherheit) is responsible for SAP’s corporate activities in context of national security regulations.
The Executive Board
The Executive Board manages the Company’s business, is responsible for preparing its strategy and represents it in dealings with third parties. The Executive Board reports regularly to the Supervisory Board about SAP operations and business strategies and prepares special reports upon request. A person may not serve on the Executive Board and on the Supervisory Board at the same time.
The Executive Board and the Supervisory Board cooperate closely for the benefit of the Company. The Executive Board is required to provide the Supervisory Board regular, prompt and comprehensive information about all of the essential issues affecting the SAP Group’s business progress and its potential business risks. Furthermore, the Executive Board must maintain regular contact with the chairperson of the Supervisory Board and vice versa. The Executive Board must inform the chairperson of the Supervisory Board promptly about exceptional events that are of significance to SAP’s business. The Supervisory Board chairperson must inform the Supervisory Board accordingly and shall, if required, convene an extraordinary meeting of the Supervisory Board.
Pursuant to the Articles of Incorporation, the Executive Board must consist of at least two members. SAP SE’s Executive Board is currently comprised of six members. Any two members of the Executive Board jointly or one member of the Executive Board and the holder of a special power of attorney (Prokurist) jointly may legally represent SAP SE. The Supervisory Board appoints each member of the Executive Board for a maximum term of five years, with the possibility of re-appointment. Under certain circumstances, a member of the Executive Board may be removed by the Supervisory Board prior to the expiration of that member’s term. A member of the Executive Board may not vote on matters relating to certain contractual agreements between such member and SAP SE and may be liable to SAP SE if such member has a material interest in any contractual agreement between SAP and a third party which was not previously disclosed to and approved by the Supervisory Board. Further, as the compensation of the Executive Board members is set by the Supervisory Board, Executive Board members are unable to vote on their own compensation, with the exception that they are able to exercise voting rights in an Annual General Meeting of Shareholders resolving a non-binding vote on the system for the compensation of Executive Board members.
Under German law SAP SE’s Supervisory Board members and Executive Board members have a duty of loyalty and care towards SAP SE. They must exercise the standard of care of a prudent and diligent businessman and bear the burden of proving they did so if their actions are contested. Both bodies must consider the interest of SAP SE shareholders and our employees and, to some extent, the common good. Those who violate their duties may be held jointly and severally liable for any resulting damages unless they acted pursuant to a lawful resolution of the Annual General Meeting of Shareholders.
SAP has a Global Code of Ethics and Business Conduct for Employees (CoEBC) that is applicable to all employees, managers, the members of SAP’s Executive Board, as well as employee representatives of the Supervisory Board (see “Item 16B. Code of Ethics” for details).
Under German law the Executive Board of SAP SE is required to assess and manage all major risks for the SAP Group. In addition, all measures taken by management to reduce and handle the risks have to be documented. Therefore, SAP’s Executive Board has adopted suitable measures such as implementing an enterprise-wide risk monitoring system to ensure that adverse developments endangering the corporate standing are recognized at a reasonably early point in time.
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The Office of Ethics and Compliance (OEC) was created by the SAP Executive Board in 2006 with the remit of corruption, bribery and substantial fraud. In 2025, anti - money laundering was added to OEC's remit. The OEC is led by SAP's Group Chief Compliance Officer (GCCO) who reports directly to the group CEO. The GCCO has direct communication channels and reporting obligations to the Audit and Compliance Committee. Amongst its many other compliance-related functions, the OEC manages a network of global field compliance officers who act as the first point of contact for the business in compliance matters. The OEC provides targeted compliance training and compliance-related communications to SAP employees to raise the awareness and understanding of legal and regulatory compliance policies. Speak Out at SAP is SAP’s independently managed whistleblower reporting tool, through which any matters or concerns can be reported easily, and, if desired, anonymously. The tool is available twenty-four hours a day, seven days a week, both internally to SAP employees and externally to concerned parties, including customers, suppliers, and partners. Beyond Speak Out at SAP, we provide further reporting channels, including an internal ticketing system, a postal address for written submissions, as well as local contact persons worldwide. Concerns can be raised without fear of reprisal or retaliation.
The Extended Board
On February 1, 2025, the Executive Board established the Extended Board. The Extended Board is a committee of the Executive Board comprised of senior leaders from key functions and regulated by the Rules of Procedure of the Executive Board. The Executive Board appoints the Extended Board members, with the Supervisory Board providing consultation on these appointments. Currently, the Extended Board is comprised of nine members. The Extended Board performs advisory, coordination and decision - preparation functions for the Executive Board, however the Executive Board retains ultimate responsibility for overseeing and deciding on the activities of the company. All Extended Board members report to an Executive Board member. The Executive Board and the Extended Board meet regularly, and Extended Board members join Executive Board meetings as relevant.
The Annual General Meeting of Shareholders
Shareholders of the Company exercise their voting rights at shareholders’ meetings. The Executive Board calls the Annual General Meeting of Shareholders, which must take place within the first six months of each fiscal year. The Supervisory Board or the Executive Board may call an extraordinary meeting of the shareholders if the interests of the stock corporation so require. Additionally, shareholders of SAP SE holding in the aggregate a minimum of 5% of SAP SE’s issued share capital may call an extraordinary meeting of the shareholders. Shareholders as of the record date are entitled to attend and participate in shareholders’ meetings if they have provided timely notice of their intention to attend the meeting.
At the Annual General Meeting of Shareholders, the shareholders are asked, among other things, to formally approve the actions taken by the Executive Board and the Supervisory Board in the preceding fiscal year, to approve the appropriation of the corporation’s distributable profits and to appoint an external independent auditor. Shareholder representatives of the Supervisory Board are generally elected at the Annual General Meeting of Shareholders for a term not longer than six years. Shareholders may also be asked to grant authorization to repurchase treasury shares, to resolve on measures to raise or reduce the capital of the Company or to ratify amendments of our Articles of Incorporation. The Annual General Meeting of Shareholders can make management decisions only if requested to do so by the Executive Board.
Change in Control
There are no provisions in the Articles of Incorporation of SAP SE that would have the effect of delaying, deferring, or preventing a change in control of SAP SE and that would only operate with respect to a merger, acquisition or corporate restructuring involving it or any of its subsidiaries.
According to the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz) a bidder seeking control of a company with its corporate seat in Germany or another state of the European Economic Area (EEA) and its shares being traded on an EEA stock exchange must publish an advance notice of its decision to make a tender offer, submit an offer statement to the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) for review, and obtain certification from a qualified financial institution that adequate financing is in place to complete the offer. The offer statement must be published upon approval by the Federal Financial Supervisory Authority or expiry of a certain time period without such publication being prohibited by the Federal Financial Supervisory Authority. Once a shareholder has acquired shares representing at least 30% of the voting rights in an EEA-listed company, it must make an offer for all remaining shares. The Securities Acquisition and Takeover Act requires the executive board of the target company to refrain from taking any measures that may frustrate the success of the takeover offer. However, the target executive board is permitted to take any action that a prudent and diligent management of a company that is not the target of a takeover bid would also take. Moreover, the target executive board may search for other bidders and, with the prior approval of the supervisory board, may take other defensive measures, provided that both boards act within the parameters of their general authority under the German Stock Corporation Act. An executive board may also adopt specific defensive measures if such measures have been approved by the supervisory board and were specifically authorized by the Annual General Meeting of Shareholders no earlier than 18 months in advance of such measures by a resolution of at least 75% of the shares represented.
Under the European Takeover Directive of 2004 member states had to choose whether EU restrictions on defensive measures apply to companies that are registered in their territory. Germany decided to opt out and to retain its current restrictions on a board implementing defensive measures (as described above). As required by the European Takeover Directive if a country decides to opt out the German Securities Acquisition and Takeover Act grants companies the option of voluntarily applying the European standard by a change of the Articles of Incorporation (opt-in). SAP SE has not made use of this option.
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Change in Share Capital
Under German law, the capital stock may be increased in consideration of contributions in cash or in kind, or by establishing authorized capital or contingent capital or by an increase of the company’s capital reserves. Authorized capital provides the Executive Board with the flexibility to issue new shares for a period of up to five years. The Executive Board must obtain the approval of the Supervisory Board before issuing new shares with regard to the authorized capital. Contingent capital allows the issuance of new shares for specified purposes, including stock option plans for Executive Board members or employees and the issuance of shares upon conversion of convertible bonds and exercise of stock options. By law, the Executive Board may only issue new shares with regard to the contingent capital for the specified purposes. Capital increases require an approval by at least 75% of the valid votes cast at the Annual General Meeting of Shareholders in which the increase is proposed and require an amendment to the Articles of Incorporation.
The share capital may be reduced by an amendment to the Articles of Incorporation approved by at least 75% of the valid votes cast at the Annual General Meeting of Shareholders. In addition, the Executive Board of SAP SE is allowed to authorize a reduction of the company’s capital stock by canceling a defined number of repurchased treasury shares if this repurchasing and the subsequent reduction have already been approved by the Annual General Meeting of Shareholders.
The Articles of Incorporation do not contain conditions regarding changes in the share capital that are more stringent than those provided by applicable European and German law.
Rights Accompanying our Shares
There are no limitations imposed by German law or the Articles of Incorporation of SAP SE on the rights to own securities, including the rights of non-residents or foreign holders to hold the ADRs or ordinary shares, to exercise voting rights or to receive dividends or other payments on such shares.
According to the German stock corporation law, the rights of shareholders cannot be amended without shareholders’ consent. The Articles of Incorporation do not provide more stringent conditions regarding changes of the rights of shareholders than those provided by applicable European and German law.
Voting Rights
Each ordinary SAP SE share represents one vote. Cumulative voting is not permitted under applicable European and German law. A corporation’s Articles of Incorporation may stipulate a majority necessary to pass a shareholders’ resolution differing from the majority provided by law, unless the law mandatorily requires a certain majority. Section 21 (1) of SAP SE’s Articles of Incorporation provides that resolutions may be passed at the Annual General Meeting of Shareholders with a majority of valid votes cast, unless a larger majority is prescribed by law or the Articles of Incorporation. SAP SE’s Articles of Incorporation as well as applicable European and German law require that the following matters, among others, be approved by at least 75% of the valid votes cast at the Annual General Meeting of Shareholders in which the matter is proposed:
- | changing the corporate purpose of the company set out in the Articles of Incorporation; |
- | capital increases and capital decreases; |
- | excluding preemptive rights of shareholders to subscribe for new shares or for treasury shares; |
- | dissolution; |
- | a merger into, or a consolidation with, another company; |
- | a transfer of all or virtually all of the assets; |
- | a change of corporate form, including re-conversion into a German stock corporation; |
- | a transfer of the registered seat to another EU member state; and |
- | any other amendment to the Articles of Incorporation (pursuant to section 21 (2) sentence 1 of the Articles of Incorporation). For any amendments of the Articles of Incorporation which require a simple majority for stock corporations established under German law, however, section 21 (2) sentence 2 of SAP SE’s Articles of Incorporation provides that the simple majority of the valid votes cast is sufficient if at least half of the subscribed capital is represented or, in the absence of such quorum, the majority prescribed by law (i.e. two thirds of the votes cast, pursuant to sec. 59 of the SE Regulation) is sufficient. |
Dividend Rights
See “Item 3. Key Information — Dividends.”
Preemptive Rights
Shareholders have preemptive rights to subscribe (Bezugsrecht) for any issue of additional shares in proportion to their shareholdings in the issued capital. The preemptive rights may be excluded under certain circumstances by a shareholders’ resolution (approved by at least 75% of the valid votes cast at the Annual General Meeting of Shareholders) or by the Executive Board authorized by such shareholders’ resolutions and subject to the consent of the Supervisory Board.
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Liquidation
If SAP SE were to be liquidated, any liquidation proceeds remaining after all of our liabilities were paid would be distributed to our shareholders in proportion to their shareholdings.
Disclosure of Shareholdings
SAP SE’s Articles of Incorporation do not require shareholders to disclose their shareholdings. The German Securities Trading Act (Wertpapierhandelsgesetz), however, requires holders of voting securities of SAP SE to notify SAP SE and the Federal Financial Supervisory Authority of the number of shares they hold if that number reaches, exceeds or falls below specified thresholds. These thresholds are 3%, 5%, 10%, 15%, 20%, 25%, 30%, 50% and 75% of the corporation’s outstanding voting rights. In respect of certificates representing shares, the notification requirement shall apply exclusively to the holder of the certificates. In addition, the German Securities Trading Act also obliges anyone who holds, directly or indirectly, financial instruments that convey an unconditional entitlement to acquire under a legally binding agreement, shares in SAP SE, to notify SAP SE and the Federal Financial Supervisory Authority if the thresholds mentioned above have been reached, exceeded or fallen below, with the exception of the 3% threshold. This notification obligation also exists for the holder of a financial instrument which merely de facto enables its holder or a third party to acquire shares in SAP SE, subject to the thresholds mentioned in the preceding sentence. In connection with this notification, obligation positions in voting rights and other financial instruments have to be aggregated.
Exchange Controls and Other Limitations Affecting Security Holders
The euro is a fully convertible currency. At the present time, Germany does not restrict the export or import of capital, except for investments in certain areas in accordance with applicable resolutions adopted by the United Nations and the European Union. However, for statistical purposes only, every individual or corporation residing in Germany (“Resident”) must report to the German Central Bank (Deutsche Bundesbank), subject only to certain immaterial exceptions, any payment received from or made to an individual or a corporation residing outside of Germany (“Non-Resident”) if such payment exceeds €50,000 (or the equivalent in a foreign currency). In addition, German Residents must report any accounts payable to or receivable from Non-Residents if such payables or receivables, in the aggregate, exceed €6 million (or the equivalent in a foreign currency) at the end of any calendar month. Furthermore, companies resident in Germany with accounts payable to or receivable from Non-Residents in excess of €500 million have to report these payables or receivables to/from Non-Residents insofar as they result from derivative instruments at the end of each calendar quarter. Residents are also required to report annually to the German Central Bank any shares or voting rights of 10% or more which they hold directly or indirectly in non-resident corporations with total assets of more than €6 million. Corporations residing in Germany with assets in excess of €6 million must report annually to the German Central Bank any shares or voting rights of 10% or more held directly or indirectly by a Non-Resident.
Taxation
General
The following discussion is a summary of certain material German tax and U.S. federal income tax consequences of the acquisition, ownership and disposition of our ADRs or ordinary shares to a U.S. Holder. In general, a U.S. Holder (as hereinafter defined) is any beneficial owner of our ADRs or ordinary shares that (i) is a citizen or resident of the U.S. or a corporation organized under the laws of the U.S. or any political subdivision thereof, an estate whose income is subject to U.S. federal income tax regardless of its source or a trust, if a U.S. court can exercise primary supervision over its administration and one or more U.S. persons are authorized to control all substantial decisions of the trust; (ii) is not a resident of Germany for purposes of the income tax treaty between the U.S. and Germany (Convention between the Federal Republic of Germany and the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and Capital and to certain other Taxes, as amended by the Protocol of June 1, 2006 and as published in the German Federal Law Gazette 2008 vol. II pp. 611/851; the “Treaty”); (iii) owns the ADRs or ordinary shares as capital assets; (iv) does not hold the ADRs or ordinary shares as part of the business property of a permanent establishment or a fixed base in Germany; and (v) is fully entitled to the benefits under the Treaty with respect to income and gain derived in connection with the ADRs or ordinary shares. Special rules which are not discussed in the following summary apply to pension funds and certain other tax-exempt investors.
THE FOLLOWING IS NOT A COMPREHENSIVE DISCUSSION OF ALL GERMAN TAX AND U.S. FEDERAL INCOME TAX CONSEQUENCES THAT MAY BE RELEVANT FOR U.S. HOLDERS OF OUR ADRs OR ORDINARY SHARES. THEREFORE, U.S. HOLDERS ARE STRONGLY URGED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE OVERALL GERMAN TAX AND U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR ADRs OR ORDINARY SHARES IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, INCLUDING THE EFFECT OF ANY STATE, LOCAL OR OTHER FOREIGN OR DOMESTIC LAWS.
German Taxation
The summary set out below is based on German tax laws, interpretations thereof and applicable tax treaties to which Germany is a party and that are in force at the date of this report; it is subject to any changes in such authority occurring after that date, potentially with retroactive effect, that could result in German tax consequences different from those discussed below. This discussion is also based, in part, on representations of the Depositary and assumes that each obligation of the Deposit Agreement and any related agreements will be performed in accordance with its terms. For additional information on the Depository and the fees associated with SAP’s ADR program see “Item 12. Description of Securities Other Than Equity Securities — American Depository Shares.”
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For purposes of applying German tax law and the applicable tax treaties to which Germany is a party, a holder of ADRs will generally be treated as owning the ordinary shares represented thereby.
German Taxation of Dividends
Under German income tax law, the full amount of dividends distributed by an incorporated company is generally subject to German withholding tax at a domestic rate of 25% plus a solidarity surtax of 5.5% thereon (effectively 1.375% of dividends before withholding tax), resulting in an aggregate withholding tax rate from dividends of 26.375%. Since January 1, 2017, taxes are incurred on the third bank working day after the Annual General Meeting of Shareholders, or at a later date as may be stipulated by SAP’s Articles of Incorporation or by the Annual General Meeting of Shareholders’ decision on dividends. Non-resident corporate shareholders will generally be entitled to a refund in the amount of two-fifths of the withholding tax (including solidarity surtax thereon). This does not preclude a further reduction or refund of withholding tax, if any, available under a relevant tax treaty.
Generally, for many non-resident shareholders the withholding tax rate is currently reduced under applicable income tax treaties. Rates and refund procedures may vary according to the applicable treaty. To reduce the withholding tax to the applicable treaty tax rate a non-resident shareholder must apply for a refund of withholding taxes paid. Any refund applications must be submitted electronically to the German Federal Tax Office (Bundeszentralamt für Steuern, BZSt). For details, such non-resident shareholders are urged to consult their own tax advisors. Special rules apply for the refund to U.S. Holders (we refer to the below section “Refund Procedures for U.S. Holders”).
Refund Procedures for U.S. Holders
Under the Treaty, a partial refund of the 25% withholding tax equal to 10% of the gross amount of the dividend and a full refund of the solidarity surtax can be obtained by a U.S. Holder. Thus, for each US$100 of gross dividends paid by SAP SE to a U.S. Holder, the dividends (which are dependent on the euro/U.S. dollar exchange rate at the time of payment) will be initially subject to a German withholding tax of US$26.375, of which US$11.375 may be refunded under the Treaty. As a result, a U.S. Holder effectively would receive a total dividend of US$85 (provided the euro/U.S. dollar exchange rate at the time of payment of the dividend is the same as at the time of refund, otherwise the effective dividend may be higher or lower). Further relief of German withholding tax under the Treaty may be available for corporate U.S. Holders owning at least 10% of the voting stock of SAP or U.S. Holders qualifying as pension fund within the meaning of the Treaty, subject to further requirements being met, in particular certain holding requirements.
To claim the refund of amounts withheld in excess of the Treaty rate, a U.S. Holder must submit a claim for refund including a certificate of residence and all relevant tax certificates to the German tax authorities. Since the beginning of 2023, applications for the exemption and reimbursement from withholding tax must be filed electronically using the officially prescribed data set. Hereby, it is necessary to use the official online portal of the Federal Central Tax Office (BZSt Online Portal, BOP) to file the application. To submit an application online, a software certificate (a BOP certificate or an Elster certificate) is required. The registration process for the certificate can take up to six weeks. Respective guidelines are available on the homepage of the German Federal Tax Office (http://www.bzst.de).
U.S. Holders must also submit to the German tax authorities a certification of their U.S. residency status (IRS Form 6166). This certification can be obtained from the Internal Revenue Service (IRS) by filing a request for certification on IRS Form 8802, which will not be processed unless a user fee is paid. IRS Form 8802 and its instructions can be obtained from the IRS website at www.irs.gov. U.S. Holders should consult their own tax advisors regarding how to obtain an IRS Form 6166.
The German tax authorities reserve the right to audit the entitlement to tax refunds for several years following their payment pursuant to the Treaty in individual cases.
The German tax authorities will issue refunds denominated in euros. In the case of shares held through banks or brokers participating in the Depository, the refunds will be issued to the Depository, which will convert the refunds to U.S. dollar. The resulting amounts will be paid to banks or brokers for the account of the U.S. Holders.
German Taxation of Capital Gains
Under German income tax law, a capital gain derived from the sale or other disposition of ADRs or ordinary shares by a non-resident shareholder is subject to income tax in Germany only if such non-resident shareholder has held, directly or indirectly, ADRs or ordinary shares representing 1% or more of the registered share capital of a company at any time during the five-year period immediately preceding the sale or other disposition.
However, a U.S. Holder of ADRs or ordinary shares that qualifies for benefits under the Treaty is not subject to German income or corporate income tax on the capital gain derived from the sale or other disposition of ADRs or ordinary shares.
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German Gift and Inheritance Tax
Generally, a transfer of ADRs or ordinary shares by a shareholder at death or by way of gift will be subject to German gift or inheritance tax, respectively, if (i) the decedent or donor, or the heir, donee or other transferee is resident in Germany at the time of the transfer, or with respect to German citizens who are not resident in Germany, if the decedent or donor, or the heir, donee or other transferee has not been continuously outside of Germany for a period of more than five years, i.e. had a place of residency within the last five years (this term maybe amended by applicable estate tax treaties, e.g. a period of ten years applies to German expatriates with residence in the United States); (ii) the ADRs or ordinary shares are part of the business property of a permanent establishment or a fixed base in Germany; or (iii) the ADRs or ordinary shares subject to such transfer form part of a portfolio that represents 10% or more of the registered share capital of the Company and has been held, directly or indirectly, by the decedent or donor, respectively, at the time of the transfer, actually or constructively together with related parties.
However, the right of the German government to impose gift or inheritance tax on a non-resident shareholder may be limited by an applicable estate tax treaty. In the case of a U.S. Holder, a transfer of ADRs or ordinary shares by a U.S. Holder at death or by way of gift generally will not be subject to German gift or inheritance tax by reason of the estate tax treaty between the U.S. and Germany (Convention between the Federal Republic of Germany and the United States of America for the Avoidance of Double Taxation with respect to Estate, Gift and Inheritance Taxes, German Federal Law Gazette 1982 vol. II page 846, as amended by the Protocol of December 14, 1998 and as published on December 21, 2000, German Federal Law Gazette 2001 vol. II, page 65; the “Estate Tax Treaty”) so long as (i) the decedent or donor, and (ii) the heir, donee or other transferee was not domiciled in Germany for purposes of the Estate Tax Treaty at the time the gift was made, or at the time of the decedent’s death, and the ADRs or ordinary shares were not held in connection with a permanent establishment or a fixed base in Germany. In general, the Estate Tax Treaty provides a credit against the U.S. federal gift or estate tax liability for the amount of gift or inheritance tax paid in Germany, subject to certain limitations, in a case where the ADRs or ordinary shares are subject to German gift or inheritance tax and U.S. federal gift or estate tax.
Other German Taxes
There are currently no German net worth, transfer, stamp or other similar taxes that would apply to a U.S. Holder on the acquisition, ownership, sale or other disposition of our ADRs or ordinary shares.
U.S. Taxation
The following discussion applies to U.S. Holders only if the ADRs and ordinary shares are held as capital assets for tax purposes. It does not address tax considerations applicable to U.S. Holders that may be subject to special tax rules, such as dealers or traders in securities, financial institutions, insurance companies, tax-exempt entities, regulated investment companies, U.S. Holders that hold ordinary shares or ADRs as a part of a straddle, conversion transaction or other arrangement involving more than one position, U.S. Holders that own (or are deemed for U.S. tax purposes to own) 10% or more (by vote or value) of the stock of SAP SE, U.S. Holders subject to special tax accounting rules as a result of any item of gross income with respect to the ADRs or shares being taken into account in the applicable financial statement, U.S. Holders that have a principal place of business or “tax home” outside the United States or U.S. Holders whose “functional currency” is not the U.S. dollar and U.S. Holders that hold ADRs or ordinary shares through partnerships or other pass-through entities.
The summary set out below is based upon the U.S. Internal Revenue Code of 1986, as amended (the “Code”), the Treaty and regulations, rulings and judicial decisions thereunder at the date of this report. Any such authority may be repealed, revoked or modified, potentially with retroactive effect, so as to result in U.S. federal income tax consequences different from those discussed below. No assurance can be given that the conclusions set out below would be sustained by a court if challenged by the IRS. The discussion below is based, in part, on representations of the Depositary, and assumes that each obligation in the Deposit Agreement and any related agreements will be performed in accordance with its terms.
For U.S. federal income tax purposes, a U.S. Holder of ADRs will be considered to own the ordinary shares represented thereby. Accordingly, unless the context otherwise requires, all references in this section to ordinary shares are deemed to refer likewise to ADRs representing an ownership interest in ordinary shares.
U.S. Taxation of Dividends
Subject to the discussion below under “Passive Foreign Investment Company Considerations”, distributions made by SAP SE with respect to ordinary shares (other than distributions in liquidation and certain distributions in redemption of stock), including the amount of German tax deemed to have been withheld in respect of such distributions, will generally be taxed to U.S. Holders as ordinary dividend income.
As discussed above, a U.S. Holder may obtain a refund of German withholding tax under the Treaty to the extent that the German withholding tax exceeds 15% of the dividend distributed. Thus, for each US$100 of gross dividends paid by SAP SE to a U.S. Holder, the dividends (which are dependent on the euro/ U.S. dollar exchange rate at the time of payment) will be initially subject to German withholding tax of US$25 plus US$1.375 solidarity surtax, and the U.S. Holder will receive US$73.625. A U.S. Holder who obtains the Treaty refund will receive from the German tax authorities an additional amount in euro that would be equal to US$11.375. For U.S. tax purposes, such U.S. Holder will be considered to have received a total distribution of US$100, which will be deemed to have been subject to German withholding tax of US$15 (15% of US$100) resulting in the net receipt of US$85 (provided the euro/ U.S. dollar exchange rate at the time of payment of the dividend is the same as at the time of refund, otherwise the effective dividend may be higher or lower).
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In the case of a distribution in euro, the amount of the distribution generally will equal the U.S. dollar value of the euro distributed (determined by reference to the spot currency exchange rate on the date of receipt of the distribution, or receipt by the Depositary in the case of a distribution on ADRs), regardless of whether the holder in fact converts the euro into U.S. dollar, and the U.S. Holder will not realize any separate foreign currency gain or loss (except to the extent that such gain or loss arises on the actual disposition of foreign currency received). However, a U.S. Holder may be required to recognize foreign currency gain or loss on the receipt of a refund in respect of German withholding tax to the extent the U.S. dollar value of the refund differs from the U.S. dollar equivalent of that amount on the date of receipt of the underlying dividend.
Dividends paid by SAP SE generally will constitute “portfolio income” for purposes of the limitations on the use of passive activity losses (and, therefore, generally may not be offset by passive activity losses) and as “investment income” for purposes of the limitation on the deduction of investment interest expense. Dividends paid by SAP SE will not be eligible for the dividends received deduction generally allowed to U.S. corporations under Section 243 of the Code. Dividends paid by SAP SE to an individual are treated as “qualified dividends” (assuming the holding requirement is met) subject to capital gains rates, i.e., at a maximum rate of 20%, if SAP SE was not in the prior year and, is not in the year in which the dividend is paid, a passive foreign investment company (“PFIC”). Based on our audited financial statements and relevant market and shareholder data, we believe that we were not treated as a PFIC for U.S. federal income taxes with respect to our 2025 tax year. In addition, based on our audited financial statements and our current expectations regarding the value and nature of our assets, the sources and nature of our income, and relevant market and shareholder data, we do not anticipate becoming a PFIC for the 2026 tax year. Certain U.S. holders who are individuals, trusts, or estates, must pay a Medicare tax at a rate of 3.8% on the lesser of (i) net investment income such as dividends and (ii) the excess of modified adjusted gross income over the statutory thresholds.
U.S. Taxation of Capital Gains
In general, assuming that SAP SE at no time is a PFIC, upon a sale or exchange of ordinary shares to a person other than SAP SE, a U.S. Holder will recognize gain or loss in an amount equal to the difference between the amount realized on the sale or exchange and the U.S. Holder’s adjusted tax basis in the ordinary shares. Such gain or loss will be a capital gain or loss and will be considered a long-term capital gain (taxable at a reduced rate for individuals) if the ordinary shares were held for more than one year. Capital gains may also be subject to the Medicare tax at a rate of 3.8%. The deductibility of capital losses is subject to significant limitations. Upon a sale of ordinary shares to SAP SE, a U.S. Holder may recognize a capital gain or loss or, alternatively, may be considered to have received a distribution with respect to the ordinary shares, in each case depending upon the application to such sale of the rules of Section 302 of the Code.
Deposit and withdrawal of ordinary shares in exchange for ADRs by a U.S. Holder will not result in its realization of gain or loss for U.S. federal income tax purposes.
U.S. Information Reporting and Backup Withholding
Dividend payments made to holders and proceeds paid from the sale of shares or ADRs are subject to information reporting to the Internal Revenue Service (IRS) and will be subject to backup withholding (currently imposed at a 24% rate) unless the holder (i) is a corporation or other exempt recipient or (ii) provides a taxpayer identification number on a properly completed IRS Form W-9 and certifies that no loss of exemption from backup withholding has occurred. Holders that are not U.S. persons are not subject to information reporting or backup withholding. However, such a holder may be required to provide a certification of its non-U.S. status in connection with payments received within the United States or through a U.S.-related financial intermediary.
Backup withholding is not an additional tax and any amounts withheld as backup withholding may be credited against a holder’s U.S. federal income tax liability. A holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the Internal Revenue Service and furnishing any required information.
Shareholders may be subject to other U.S. information reporting requirements and should consult their own tax advisors for application of these reporting requirements to their own facts and circumstances.
U.S. Foreign Tax Credit
In general, in computing its U.S. federal income tax liability, a U.S. Holder may elect for each taxable year to claim a deduction or, subject to the limitations on foreign tax credits generally, a credit for foreign income taxes paid or accrued by it. For U.S. foreign tax credit purposes, subject to the applicable limitations under the foreign tax credit rules, German tax withheld from dividends paid to a U.S. Holder, up to the 15% provided under the Treaty will be eligible for credit against the U.S. Holder’s federal income tax liability or, if the U.S. Holder has elected to deduct such taxes, may be deducted in computing taxable income. U.S. Holders should consult their tax advisors about potential U.S. tax consequences of German tax withheld and/or refunded, including with respect to fluctuation of the euro/U.S. dollar exchange rate.
For U.S. foreign tax credit purposes, dividends paid by SAP SE generally will be treated as foreign-source income and as “passive category income”. Gains or losses realized by a U.S. Holder on the sale or exchange of ordinary shares generally will be treated as U.S.-source gain or loss.
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Passive Foreign Investment Company Considerations
Special and adverse U.S. tax rules apply to a U.S. Holder that holds an interest in a PFIC. Based on current projections concerning the composition of SAP SE’s income and assets, SAP SE does not believe that it will be treated as a PFIC for its current or future taxable years. However, because this conclusion is based on our current projections and expectations as to its future business activity, SAP SE can provide no assurance that it will not be treated as a PFIC in respect of its current or any future taxable years.
Material Contracts
See “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Disclosures”, for information on our credit facilities.
Documents on Display
We are subject to the informational requirements of the Securities Exchange Act of 1934 (“Exchange Act”), as amended. In accordance with these requirements, we file reports and furnish other information as a foreign private issuer with the SEC. These materials, including this report and the exhibits thereto, are available at www.sec.gov. In addition, information about us is available at our Web site: www.sap.com.
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to various financial risks, such as market risks, including changes in foreign currency exchange rates, interest rates and equity prices, as well as credit risk and liquidity risk. We manage these risks on a Group-wide basis. Selected derivatives are exclusively used for this purpose and not for speculation, which is defined as entering into derivative instruments without a corresponding underlying transaction. Financial risk management is done centrally. See Note (F.1) to our Consolidated Financial Statements for our quantitative and qualitative disclosures about market risk.
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
American Depositary Shares
Fees and Charges Payable by ADR Holders
Deutsche Bank Trust Company Americas is the Depositary for SAP SE’s ADR program. ADR holders may be required to pay the following charges:
- | taxes and other governmental charges; |
- | registration fees as may be in effect from time to time for the registration of transfers of SAP ordinary shares on any applicable register to the Depositary or its nominee or the custodian or its nominee in connection with deposits or withdrawals under the Deposit Agreement; |
- | applicable air courier, cable, telex and facsimile expenses of the Depositary; |
- | expenses incurred by the Depositary in the conversion of foreign currency; |
- | US $5.00 or less per 100 ADSs (or portion thereof) to the Depositary for the execution and delivery of ADRs (including in connection with the depositing of SAP ordinary shares or the exercising of rights) and the surrender of ADRs; |
- | a maximum aggregate service fee of US $3.00 per 100 ADSs (or portion thereof) per calendar year to the Depositary for the services performed by the Depositary in administering the ADR program, including for processing any cash dividends and other cash distributions; and |
- | US $5.00 or less per 100 ADSs (or portion thereof) to the Depositary for distribution of securities other than SAP ordinary shares or rights. |
These fees may at any time and from time to time be changed by agreement between SAP SE and the Depositary. These charges are described more fully in Section 5.9 of the Amended and Restated Deposit Agreement dated as of November 25, 2009, as amended by Amendment No. 1 dated as of March 18, 2016 and as may be further amended from time to time, incorporated by reference as Exhibits 4.1.1 and 4.1.2 to this report.
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Applicable service fees are either deducted from any cash dividends or other cash distributions or charged separately to holders in a manner determined by the Depositary, depending on whether ADSs are registered in the name of investors (whether certificated or in book-entry form) or held in brokerage and custodian accounts (via the Depository Trust Company, or DTC). In the case of distributions of securities, the Depositary charges the applicable ADS record date holder concurrent with the distribution. In the case of ADSs registered in the name of the investor, whether certificated or in book entry form, the Depositary sends invoices to the applicable record date ADS holders. For ADSs held in brokerage and custodian accounts via DTC, the Depositary may, if permitted by the settlement systems provided by DTC, collect the fees through those settlement systems from the brokers and custodians holding ADSs in their DTC accounts. The brokers and custodians who hold their clients’ ADSs in DTC accounts in such case may in turn charge their clients’ accounts the amount of the service fees paid to the Depositary.
In the event of a refusal to pay applicable fees, the Depositary may refuse the requested services until payment is received or may set off the amount of the fees from any distribution to be made to the ADR holder, all in accordance with the Deposit Agreement.
If any taxes or other governmental charges are payable by the holders and/or beneficial owners of ADSs to the Depositary, the Depositary, the custodian or SAP may withhold or deduct from any distributions made in respect of the deposited SAP ordinary share and may sell for the account of the holder and/or beneficial owner any or all of the deposited ordinary shares and apply such distributions and sale proceeds in payment of such taxes (including applicable interest and penalties) or charges, with the holder and the beneficial owner thereof remaining fully liable for any deficiency.
Fees and Other Payments Payable by the Depositary to SAP
In connection with the ADR program, the Depositary has agreed to make certain payments to SAP and waive certain costs of providing ADR administrative and reporting services, including reporting of ADR program activity, distribution of information to investors and managing the ADR program. For the period beginning October 29, 2024 and ending October 28, 2025, the Depositary made direct and indirect payments to SAP in an aggregate amount of US$3,713,865.51 related to the ADR program.
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PART II
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
None.
ITEM 15. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
SAP designs disclosure controls and procedures to ensure that information required to be disclosed by SAP in reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by SAP in the reports that it files or submits under the Exchange Act is accumulated and communicated to SAP management, including SAP’s principal executive and financial officers (i.e. SAP’s chief executive officer (CEO) and chief financial officer (CFO)), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. SAP’s management evaluated, with the participation of SAP’s CEO and CFO the effectiveness of SAP’s disclosure controls and procedures as of December 31, 2025. The evaluation was led by SAP’s Global Risk & Assurance Services (GR&AS) function, including dedicated “GR&AS Internal Auditors” in all of SAP’s major entities and business units with the participation of process owners, SAP’s key corporate senior management, senior management of each business group, and as indicated above under the supervision of SAP’s CEO and CFO. Based on the foregoing management evaluation, SAP’s CEO and CFO, concluded that as of December 31. 2025, SAP’s disclosure controls and procedures were effective.
Management’s Annual Report on Internal Control Over Financial Reporting
The management of SAP is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. SAP’s internal control over financial reporting is a process designed under the supervision of SAP’s CEO and CFO to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
SAP’s management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in “Internal Control — Integrated Framework (2013)”.
Based on the assessment under these criteria, SAP management has concluded that, as of December 31, 2025, the Company’s internal control over financial reporting was effective.
BDO AG Wirtschaftsprüfungsgesellschaft defined as BDO, our independent registered public accounting firm, has issued its audit report on the effectiveness of SAP’s internal control over financial reporting, which is included in Item 18. Financial Statements, “Report of Independent Registered Public Accounting Firm.”
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting framework during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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ITEM 16. [RESERVED]
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
Our Supervisory Board has determined that each of Jennifer Xin-Zhe Li and Dr. Gunnar Wiedenfels qualify as an “audit committee financial expert”, as defined by the regulations of the Commission issued pursuant to Section 407 of the Sarbanes-Oxley Act of 2002 and meet the requirements of Item 16A. Each of Ms. Li and Dr. Wiedenfels is “independent”, as such term is defined in Rule 10A-3 under the Exchange Act.
ITEM 16B. CODE OF ETHICS
In 2025, SAP’s Global Code of Ethics and Business Conduct for Employees (CoEBC) continued to apply to all employees, managers, the members of SAP’s Executive Board, as well as employee representatives on the Supervisory Board. It is the primary ethical framework guiding the way SAP conducts business and remains on course for success. It is available in 23 languages, and it is one of a number of global policies that provide clear guidance to employees. Newly acquired companies are required to meet the minimum standards set forth in the CoEBC. Our CoEBC constitutes a “code of ethics” as defined in Item 16.B of Form 20-F, and, together with our Partner and Supplier Codes of Conduct, sets standards for all dealings with customers, partners, competitors, and suppliers, including regulations with regard to confidentiality, loyalty, preventing conflicts of interest, preventing bribery, data protection and privacy, and avoiding anti-competitive practices. The CoEBC is available on our website under http://www.sap.com/corporate-en/investors/governance/policies-statutes.epx.
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees, Audit Related Fees, Tax Fees and All Other Fees
Refer to Note (G.7) to our Consolidated Financial Statements for information on fees charged by our independent registered public accounting firm, BDO, for audit services and other professional services.
Audit Committee’s Pre-Approval Policies and Procedures
As required under German law, our shareholders appoint our external independent auditors to audit our financial statements, based on a proposal that is legally required to be submitted by the Supervisory Board. The Supervisory Board’s proposal is based on a recommendation by the Audit and Compliance Committee. See also the description in “Item 10. Additional Information — Corporate Governance.”
In 2002 our Audit and Compliance Committee adopted a policy with regard to the pre-approval of audit and non-audit services to be provided by our external independent auditors. This policy, which is designed to assure that such engagements do not impair the independence of our auditors, was amended several times since 2002 with the latest changes made to reflect the provisions on audit and non-audit services introduced by European Union in 2014. The policy requires prior approval of the Audit and Compliance Committee for audit services to be provided by our external independent auditors for the SAP Group which includes audit services for consolidated local SAP entities. With regard to non-audit services the policy distinguishes among three categories of services:
- | “Prohibited services:” This category includes services that our external independent auditors must not be engaged to perform. These are services that are not permitted by applicable law or that would be inconsistent with maintaining the auditors’ independence. |
- | “Services requiring universal approval:” Services of this category may be provided by our external independent auditors up to a certain aggregate amount in fees per year that is determined by the Audit and Compliance Committee. |
- | “Services requiring individual approval:” Services of this category may only be provided by our external independent auditors if they have been individually (specifically) pre-approved by the Audit and Compliance Committee or an Audit and Compliance Committee member who is authorized by the Audit and Compliance Committee to make such approvals. |
According to delegation rules as defined in the policy for approval of audit and non - audit services our Chief Accounting Officer or individuals empowered by him review all individual requests to engage our external independent auditors as a service provider in accordance with this policy and determines the category to which the requested service belongs. All requests for engagements with expected fees over a specified limit are additionally reviewed by our CFO. Based on the determination of the category the request is (i) declined if it is a “prohibited service,” (ii) approved if it is a “service requiring universal approval” and the maximum aggregate amount fixed by the Audit and Compliance Committee has not been reached or (iii) forwarded to the Audit and Compliance Committee for individual approval if the “service requires individual approval” or is a “service requiring universal approval” and the maximum aggregate amount fixed by the Audit and Compliance Committee has been exceeded.
Our Audit and Compliance Committee’s pre-approval policies also include information requirements to ensure the Audit and Compliance Committee is kept aware of the volume and nature of engagements involving our external independent auditors that were not individually pre-approved by the Audit and Compliance Committee itself.
Substantially all of the work performed to audit our Consolidated Financial Statements was performed by our principal independent public accounting firm’s full-time, permanent employees. See Note (G.7) to our Consolidated Financial Statements for additional information related to our principal accountant fees and services.
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ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
Rule 10A-3 of the Exchange Act requires that all members of our audit committee be independent, subject to certain exceptions. In accordance with German law, the Audit and Compliance Committee consists of both employee and shareholder elected members. Rule 10A-3 provides an exception for an employee of a foreign private issuer such as SAP who is not an executive officer of that issuer and who is elected to the supervisory board or audit committee of that issuer pursuant to the issuer’s governing law. In this case, the employee is exempt from the independence requirements of Rule 10A-3 and is permitted to sit on the audit committee.
We rely on this exemption. Our Audit and Compliance Committee includes four employee representatives, Jakub Černý, César Martin, Dr. Eberhard Schick and Nina Strassner, who were appointed to our Supervisory Board pursuant to the Agreement on the Involvement of Employees in SAP SE (see “Item 6. Directors, Senior Management and Employees.” for details). We believe that our reliance on this exemption does not materially adversely affect the ability of our Audit and Compliance Committee to act independently and to satisfy the other requirements of Rule 10A-3.
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
At the Annual General Meeting of Shareholders on May 11, 2023, the Executive Board was authorized to acquire until the expiry of May 10, 2028, shares in the Company representing a pro rata amount of capital stock of up to €120 million.
We did not purchase any ADRs in 2025. In May 2023 we announced a share buy-back program, with an aggregate volume of up to €5 billion and a term until December 31, 2025. In 2025, purchases of SAP’s ordinary shares were conducted in two tranches under this program, which was completed on August 13, 2025, fully utilizing the approved program volume. The following table sets out information concerning repurchases of SAP’s ordinary shares in 2025.
| | | (c) Total Number of | | (d) Maximum Number of | |||
Shares Purchased as | Shares that May Yet Be | |||||||
(a) Total Number of | (b) Average Price Paid | Part of Publicly Announced | Purchased Under these | |||||
Period |
| Shares Purchased1.2 |
| per Share (in €) |
| Plans and Programs |
| Plans and Programs3 |
January 2025 | 97,617 | 236.46 | 97,617 | 60,838,035 | ||||
February 2025 | 0 | 0.00 | 0 | 60,860,353 | ||||
March 2025 | 458,038 | 243.33 | 458,038 | 63,098,653 | ||||
April 2025 |
| 1,371,194 |
| 226.49 |
| 1,371,194 |
| 61,740,710 |
May 2025 |
| 2,348,153 |
| 264.05 |
| 2,348,153 |
| 59,422,379 |
June 2025 |
| 2,038,960 |
| 260.44 |
| 2,038,960 |
| 58,995,123 |
July 2025 |
| 578,106 |
| 247.67 |
| 578,106 |
| 58,429,398 |
August 2025 |
| 689,043 |
| 236.28 |
| 689,043 |
| 57,762,682 |
September 2025 |
| 0 |
| 0.00 |
| 0 |
| 60,020,357 |
October 2025 |
| 0 |
| 0.00 |
| 0 |
| 60,020,357 |
November 2025 |
| 0 |
| 0.00 |
| 0 |
| 60,020,357 |
December 2025 |
| 0 |
| 0.00 |
| 0 |
| 61,950,901 |
Total |
| 7,581,111 |
| 250.90 |
| 7,581,111 |
|
1 From September 02, 2024, until April 08, 2025, SAP repurchased 7,024,422 shares at an average price of € 210.99 resulting in a purchased volume of approx. € 1.5 billion.
2 From April 24, 2025, until August 13, 2025, SAP repurchased 5,.683,802 shares at an average price of € 257.60 resulting in a purchased volume of approx. € 1.5 billion.
3 Numbers represent the maximum number of shares that may yet be purchased pursuant to section 71 paragraph (2) sentence 1 of the German Stock Corporation Act and the authorization of SAP’s Annual General Meeting of Shareholders of May 11, 2023, which provide that the shares to be purchased, together with any other shares already acquired and held by SAP or which are attributable to SAP pursuant to Section 71d and Section 71e AktG (German Stock Corporation Act), do not account for more than 10% of SAP’s capital stock. Following completion of the recent share buyback program in August 2025, any additional share purchases are subject to the approval of a new share buyback program by the Supervisory and Executive Board.
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ITEM 16F. CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT
Not applicable
ITEM 16G. DIFFERENCES IN CORPORATE GOVERNANCE PRACTICES
The following summarizes the principal ways in which our corporate governance practices differ from the NYSE corporate governance rules applicable to U.S. domestic issuers (the NYSE Rules).
Introduction
SAP is incorporated under the laws of the European Union and Germany, with securities publicly traded on markets in Germany, including the Frankfurt Stock Exchange, and in the United States on the NYSE.
The NYSE Rules permit foreign private issuers to follow applicable home country corporate governance practices in lieu of the NYSE corporate governance standards, subject to certain exceptions. Foreign private issuers electing to follow home country corporate governance rules are required to disclose the principal differences in their corporate governance practices from those required under the NYSE Rules. This Item 16G summarizes the principal ways in which SAP’s corporate governance practices differ from the NYSE Rules applicable to domestic issuers.
Legal Framework
The primary sources of law relating to the corporate governance of a European Company are the Council Regulation (EC) No. 2157/2001 on the Statute for a European Company (the “SE Regulation”), the German Act on the Implementation of Council Regulation No. 2157/2001 of October 8, 2001 on the Statute for a European Company (Gesetz zur Ausführung der Verordnung (EG) Nr. 2157/2001 des Rates vom 8. Oktober 2001 über das Statut der Europäischen Gesellschaft (SE) – SE-Ausführungsgesetz; “SE-AG”) of December 22, 2004, and the German Stock Corporation Act (Aktiengesetz). Additionally, the European Regulation (EU) No 596/2014 of the European Parliament and the Council on market abuse (the “MAR”), the German Securities Trading Act (Wertpapierhandelsgesetz), the German Securities Purchase and Take Over Act (Wertpapiererwerbs- und Übernahmegesetz), the Stock Exchange Admission Regulations, the German Commercial Code (Handelsgesetzbuch) and certain other German statutes contain corporate governance rules applicable to SAP. In addition to these mandatory rules, the GCGC summarizes the mandatory statutory corporate governance principles found in the German Stock Corporation Act and other provisions of German law. Further, the GCGC contains supplemental recommendations and suggestions for standards on responsible corporate governance intended to reflect generally accepted best practices.
The German Stock Corporation Act requires the executive and the supervisory board of publicly listed companies like SAP to declare annually that the recommendations set forth in the GCGC have been and are being complied with or which of the recommendations have not been or are not being complied with and why not. SAP disclosed and reasoned deviations from a few of the GCGC recommendations in its Declaration of Compliance on a yearly basis from 2003 onwards. Since the last Declaration of Compliance of October 2025, SAP has complied with the recommendations set out in the GCGC with the below exceptions. In the future, SAP will comply with the recommendations set out in the Code with the exception listed below in No. 2:
1. Determination of the performance criteria for the 2025 tranche of the Long-Term Incentive Plan (LTI) only in fiscal year 2025 (declaration of deviation from recommendation G.7 sentence 1 GCGC).
As the Executive Board and the Supervisory Board of SAP already declared in May 2025 in the Update of the Declaration of Compliance, the Supervisory Board decided to amend the ESG-related performance criteria with regard to the tranche of the LTI granted to the members of the Executive Board for the financial year 2025. In the LTI tranche 2025, the ESG-related performance criteria continue to have the climate performance target “Net Zero 2030” and now have a social sustainability target “Business Health Culture Index”. This determination was made before the LTI tranche 2025 was granted but is a deviation from the recommendation in Section G.7 sentence 1 of the Code because it was not made before the start of the fiscal year 2025. This decision was made in the current fiscal year in response to a series of Executive Orders issued by the US administration in January 2025, regarding the application of federal anti-discrimination regulations. As a global company, SAP ensures that we comply with the legal framework in the countries in which we operate.
With regard to tranche 2026 and subsequent tranches of the LTI, the recommendation in section G.7, sentence 1 of the Code will be complied with again.
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2. Disbursement of remaining variable remuneration components if an Executive Board member`s service contract is terminated (precautionary declaration of non-conformity with recommendation G. 12 GCGC).
The service contracts for Executive Board members and the renumeration system in place for the Executive Board of SAP provide that in the event of a premature termination of the service contract for Executive Board members due to a change of control (as defined in the service contract for Executive Board members) the tranches already granted under the respective SAP Long-Term Incentive Plan will be disbursed without undue delay. The disbursement will be made pro rata temporis in the proportion which the actual term that was shortened due to the change of control bears to the four-year-term of a tranche plus 50% of the portion which should be forfeited if pro rata temporis aspects alone were considered. In view of the above, SAP declares, by way of precaution, non-conformity with the recommendation set out in section G.12 GCGC. The reason for the provision described above is that a change of control regularly entails changes within a company that let it appear unjustified to make the disbursement amount from long-term variable remuneration components dependent on the performance of the company and its share price after the change of control. In addition, SAP is convinced that the intended linkage of the remuneration to sustainable and long-term development is not lost due to this provision since the Executive Board members, during their term of service, cannot expect a change of control to later occur.
Declarations from 2020 to 2025 are available on the SAP website.
Significant Differences
We believe the following to be the significant differences between applicable European and German corporate governance practices, as SAP has implemented them, and those applicable to domestic companies under the NYSE Rules.
SAP SE is a European Company With a Two-Tier Board System
SAP is governed by three separate bodies: (i) the Supervisory Board, which counsels, supervises and controls the Executive Board; (ii) the Executive Board, which is responsible for the management of SAP; and (iii) the Annual General Meeting of Shareholders. The rules applicable to these governing bodies are defined by European and German law and by SAP’s Articles of Incorporation. This corporate structure differs from the unitary board of directors established by the relevant laws of all U.S. states and the NYSE Rules. Under the SE Regulation and the German Stock Corporation Act, the Supervisory Board and Executive Board are separate and no individual may be a member of both boards. See “Item 10. Additional Information — Corporate Governance” for additional information on the corporate structure.
Director Independence Rules
The NYSE Rules require that a majority of the members of the board of directors of a listed issuer and each member of its nominating, corporate governance, compensation and audit committee be “independent.” As a foreign private issuer, SAP is not subject to the NYSE board, compensation committee and corporate governance committee independence requirements but instead can elect to follow its home country rules. With respect to the audit committee, SAP is required to satisfy Rule 10A-3 of the Exchange Act, which provides certain exemptions from the audit committee independence requirements in the case of employee board representatives. The NYSE Rules stipulate that no director qualifies as “independent” unless the board of directors has made an affirmative determination that the director has no material direct or indirect relationship with the listed company. However, under the NYSE Rules a director may still be deemed independent even if the director or a member of a director’s immediate family has received during a 12-month period within the prior three years up to $120,000 in direct compensation. In addition, a director may also be deemed independent even if a member of the director’s immediate family works for the company’s auditor in a non-partner capacity and not on the company’s audit.
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By contrast, the German Stock Corporation Act and the GCGC require that the Supervisory Board ensure that its members collectively have the knowledge, competencies and professional experience required to properly perform their duties. Additionally, the GCGC recommends that the Supervisory Board must have an appropriate number of independent shareholder representative members, as determined by those members, that also reflects the shareholder structure (C.6 GCGC), and determine annually whether such numbers have been met. More than half of the shareholder representatives must be independent from the company and from the Executive Board (C.7 GCGC). According to this definition, a Supervisory Board member is considered independent if he or she is independent from the company and the Executive Board, and independent from any controlling shareholder (C.6 GCGC). In the absence of a controlling shareholder at SAP, this last proviso does not apply. Supervisory Board members are considered independent from the company and the Executive Board if they have no personal or business relationship with the company or the Executive Board that may cause a substantial and not merely temporary conflict of interest (C.7 GCGC). Independence is assessed against a set of indicators (C.7 GCGC). The assessment should particularly take into consideration whether the Supervisory Board member (or a close family member) (i) was a member of the company`s Executive Board in the two years prior to the appointment to the Supervisory Board; (ii) has, or in the year prior to the appointment, had, directly or as a shareholder, or in a leading position at a non-group entity, a material business relationship with the company or one of the entities dependent on the company (for example, as a customer, supplier, lender, or advisor); (iii) is a close family member of a member of the Executive Board; (iv) has been a member of the Supervisory Board for more than 12 years. Under the Code, a Supervisory Board member can still be deemed independent even if one or more of the indicators applies; if one or more of the indicators applies and the Supervisory Board member concerned is still considered independent, the reasons for this must be given in the Corporate Governance Statement (C.8 GCGC). According to section C.10 GCGC, the chairpersons of the Supervisory Board, the Audit Committee, and the committee that addresses Executive Board compensation should be independent from the company and the Executive Board. The members of the Supervisory Board must ensure that they have enough time to perform their board duties and must carry out their duties carefully and in the company’s best interests. They must be loyal to SAP in their conduct, and the GCGC recommends that they should not accept appointment to governing bodies of, or exercise advisory functions at, companies that are in significant competition with SAP. The GCGC further recommends that each member of the Supervisory Board should inform the Supervisory Board of any conflicts of interest, and that material and sustained conflicts of interest involving a member of the Supervisory Board should result in the termination of that member’s Supervisory Board mandate. Supervisory Board members must disclose any planned conclusion of advisory or other service agreements or contracts for work with SAP, or loan agreements between them or persons closely related to them and SAP to the Supervisory Board promptly. Such agreements require the consent of the Supervisory Board. The Supervisory Board may grant its permission for any such transaction only if it is based on terms and conditions that are standard for the type of transaction in question and if the transaction is not contrary to SAP’s interest.
SAP complies with the director independence requirements and recommendations described above. In particular, the Supervisory Board of SAP SE determined in fiscal year 2025 that the shareholder representatives are all independent in the meaning of the recommendations at sections C.6 and C.7 of the Code, and, likewise, in accordance with the recommendation at section C.7 of the Code, more than half of the shareholder representatives are independent from the company and the Executive Board. In this context, the shareholder representatives determined that five (and thus more than half their total number) constitutes an appropriate number of independent shareholder representative members. Consequently, they determined that, when also considering the company`s shareholder structure, the Supervisory Board has an appropriate number of independent members in the meaning of section C.6 of the Code.
Principle 15 of the GCGC states that at least one member of the Audit Committee must have expertise in the field of accounting and at least one other member of the Audit Committee must have expertise in the field of auditing. According to Section D.3 of the GCGC the expertise in the field of accounting shall consist of special knowledge and experience in the application of accounting principles and internal control and risk management systems, and the expertise in the field of auditing shall consist of special knowledge and experience in the auditing of financial statements. Accounting and auditing also include sustainability reporting and its audit and assurance. Section D.3 of the GCGC recommends that the chairperson of the Audit Committee of the Supervisory Board should have appropriate expertise in at least one of the two areas. Section C.10 of the GCGC recommends that the chairperson of the Audit Committee should be independent from the company and the Executive Board as well as from the controlling shareholder. Furthermore, the chairperson of the Audit Committee should not simultaneously chair the Supervisory Board as a whole. Ms. Jennifer Xin-Zhe Li who is the current Chairperson of the Audit and Compliance Committee and Dr. Gunnar Wiedenfels as another member of the Audit and Compliance Committee meet these recommendations. However, applicable European and German corporate law does not require the Supervisory Board to make an affirmative determination for each individual member that it is independent or that a majority of Supervisory Board members or the members of a specific committee are independent. As described above, the GCGC only recommends that the shareholder representatives on the Supervisory Board determine whether they are independent in the meaning of and in compliance with the Code.
The NYSE independence requirements are closely linked with risks specific to unitary boards of directors that are customary for U.S. companies. In contrast, the two-tier board structure requires a strict separation of the executive board and supervisory board. In addition, the supervisory board of a European Company formed by conversion from a large German stock corporation which was subject to the principle of employee codetermination as outlined in the German Co-Determination Act of 1976 (Mitbestimmungsgesetz) is subject to at least the same level of employee participation which formerly existed in the German stock corporation that was converted to an SE. The terms of employee participation with regard to the Supervisory Board of SAP SE are, among others, set out in the Agreement on the Involvement of Employees in SAP SE, as amended from time to time. As a result, the Supervisory Board of SAP SE consists of 18 members, of which nine are representatives of SAP SE’s shareholders elected at the Annual General Meeting of Shareholders and nine members are representatives of the European employees. Only a shareholders’ representative may be elected as chairperson of the Supervisory Board. In case of a tied vote, the vote of the chairperson and, in the event that the chairperson does not participate in passing the resolution, the vote of the deputy chairperson, provided that he or she is a shareholders’ representative, will be decisive (casting vote). This board structure creates a different system of checks and balances, including employee participation, and cannot be directly compared with a unitary board system.
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Audit Committee Independence
As a foreign private issuer, the NYSE Rules require SAP to establish an Audit Committee that satisfies the requirements of Rule 10A-3 of the Exchange Act with respect to audit committee independence. SAP is in compliance with these requirements. The Chairperson of SAP’s Audit and Compliance Committee (Jennifer Xin-Zhe Li), Dr. Gunnar Wiedenfels, Dr. Friederike Rotsch and Gerhard Oswald meet the independence requirements of Rule 10A-3 of the Exchange Act. The other four Audit and Compliance Committee members, Jakub Černý, César Martin, Dr. Eberhard Schick and Nina Strassner, are employee representatives who are eligible for the exemption provided by Rule 10A-3 (b) (1) (iv) (C) (see “Item 16D Exemptions from the listing standards for audit committees” for details).
The Audit Committee independence requirements are similar to the Board independence recommendations of the GCGC. See the section above under “Director Independence Rules.” Nonetheless, SAP meets the NYSE Rules on audit committee independence applicable to foreign private issuers.
Rules on Non-Management Board Meetings are Different
Section 303 A.03 of the NYSE Rules stipulates that the non-management board of each listed issuer must meet at regularly scheduled executive sessions without the management. Under applicable European and German corporate law and the GCGC the Supervisory Board is entitled but not required to exclude Executive Board members from its meetings. The Supervisory Board exercises this right generally during its meetings. However, the Executive Board members should not attend Supervisory Board and its committees’ meetings at which the statutory auditor is called in as an expert. An exception can be made in the event that participation of the Executive Board is deemed necessary by the Supervisory Board or the relevant committee.
Rules on Establishing Committees Differ
Pursuant to Section 303 A.04 and 303 A.05 of the NYSE Rules listed companies are required to set up a Nominating/Corporate Governance Committee and a Compensation Committee, each composed entirely of independent directors and having a written charter specifying the committee’s purpose and responsibilities. In addition, each committee’s performance must be reviewed annually. Applicable European and German corporate law does not mandate the creation of specific supervisory board committees. The GCGC recommends that the Supervisory Board establishes a Nomination Committee; according to Principle 14 of the GCGC an Audit Committee is to be established. Currently, SAP has the following committees, which are in compliance with the GCGC: the Personnel and Governance Committee, the Audit and Compliance Committee, the Product and Technology Committee, the Finance and Investment Committee, the Nomination Committee and the Government Security Committee (See “Item 10. Additional Information — Corporate Governance” for more information).
Rules on Shareholders’ Compulsory Approval are Different
Section 312 of the NYSE Rules requires U.S. companies to seek shareholder approval of all equity-compensation plans, including certain material revisions thereto (subject to certain exemptions as described in the rules), issuances of common stock, including convertible stock, if the common stock has, or will have upon issuance, voting power of or in excess of 20% of the then outstanding common stock, and issuances of common stock if they trigger a change of control.
According to applicable European law, the German Stock Corporation Act and other applicable German laws, shareholder approval is required for a broad range of matters, such as amendments to the articles of association, certain significant corporate transactions (including inter-company agreements and material restructurings), the offering of stock options and similar equity compensation to its Executive Board members or its employees by a way of a conditional capital increase or by using treasury shares (including significant aspects of such an equity compensation plan as well as the exercise thresholds), the issuance of new shares, the authorization to purchase the corporation’s own shares, and other essential issues, such as transfers of all, or substantially all, of the assets of the stock corporation, including shareholdings in subsidiaries.
Specific Principles of Corporate Governance
Under the NYSE Rules Section 303A.09 listed companies must adopt and disclose corporate guidelines. Since October 2007, SAP has applied, with few exceptions, and currently with only one exception, recommended corporate governance standards of the GCGC rather than company-specific principles of corporate governance. The GCGC recommendations differ from the NYSE Standards primarily as outlined in this Item 16G.
Specific Code of Business Conduct
The NYSE Rules Section 303 A.10 requires listed companies to adopt and disclose a code of business conduct and ethics for directors, officers and employees, and to disclose promptly any waivers of the code for directors or executive officers. Although not required under applicable European and German law, SAP has a Global Code of Ethics and Business Conduct for Employees (CoEBC) that applies to all employees, managers, the members of SAP’s Executive Board, as well as employee representatives on the Supervisory Board. The CoEBC is available in 23 languages, and it is one of a number of global policies that provide clear guidance to employees. SAP complies with the requirement to disclose the Code of Ethics and Business Conduct and any waivers of the code with respect to directors and executive officers. See “Item 16B. Code of Ethics” for details.
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ITEM 16H. MINE SAFETY DISCLOSURE
Not applicable
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable
ITEM 16J. INSIDER TRADING POLICIES
ITEM 16K. CYBERSECURITY
Risk Management and Strategy
We have developed and implemented a cybersecurity risk management approach intended to protect the confidentiality, integrity, and availability of our critical systems, information, and our customers’ data.
Our information security risk management approach employs sophisticated quantification techniques to measure security exposure with various criteria including financial terms, supporting strategic investment decisions across SAP. A satellite network of unit risk coordinators provides enterprise-wide risk identification and assessment, ensuring comprehensive coverage while enabling localized security decision-making. This integrated model transforms qualitative security concerns into quantifiable information security risks, allowing leadership to prioritize investments, allocate resources efficiently, and demonstrate measurable risk reduction.
We have designed and implemented a solid security and cloud compliance strategy in line with the overall SAP business, product, and technology strategies. To execute on that strategy, we establish and manage a risk-based cybersecurity framework for SAP according to well accepted industry frameworks and standards such as SOC, ISO, PCI, along with various required regional standards, and also voluntarily align with guidance from the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF).
Cybersecurity risks are reported regularly to the Executive Board through cumulative risk reporting and risk updates are steered via regular security updates to the Executive Board. The Supervisory Board’s
Key elements of our cybersecurity risk management approach include:
| - | a security team responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; |
| - | a Global Risk Management Policy that applies to all employees and which is reviewed and updated as necessary; |
| - | an Executive Board-established early warning risk management system designed to enable transparency and compliance with applicable regulations; |
| - | risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; |
| - | third-party risk management process for service providers, suppliers, and vendors; |
| - | a Global Security Policy that applies to all employees and which is reviewed and updated as necessary; |
| - | the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; |
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| - | a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents and which is reviewed and updated as necessary; and |
| - | cybersecurity awareness training of our employees, consultants, incident response personnel, and senior management. |
SAP internal and external experts are engaged to evaluate SAP’s risk identification, assessment, and monitoring systems and processes, including with respect to cybersecurity risks. The PTC and ACC periodically request an independent review of the quality of our cybersecurity risk monitoring systems.
, our risk management systems are regularly audited by our external auditors and are subject to internal audits, including our cybersecurity monitoring systems. We consider the results of external and internal audits of our risk detection and monitoring systems and implement modifications as necessary. Finally, SAP engages third party legal consultants as necessary to assist with the implementation of legal requirements and industry standards, and to identify process weaknesses and track improvements.
As of the date of this filing, we have not identified risks from existing and known cybersecurity threats or incidents that have
Cybersecurity Governance
(1)Supervisory Board Oversight of Risks from Cybersecurity Threats
The Supervisory Board, through the PTC and the ACC, governs the Executive Board’s oversight of SAP’s cybersecurity risk management approach.
The ACC reviews the effectiveness of SAP’s system for monitoring corporate security, which includes cybersecurity. The ACC coordinates with the members of the Executive Board, as well as the Chief Security Officer (CSO) and the Chief Security Compliance & Risk Officer (CSCRO), on the cybersecurity controls and other measures established by the Executive Board. The ACC is focused on cybersecurity risk and incident management and mitigation.
The PTC reviews and monitors the technical systems and processes intended to defend against cybersecurity attacks and improve the security of SAP’s infrastructure. The PTC coordinates with the members of the Executive Board as well as the CSO and the CSCRO on the potential and actual, if any, product and operational impacts of known cybersecurity risks and incidents. The PTC is focused on mitigating the product and operational-related impacts, if any, of cybersecurity risks and incidents.
The PTC and the ACC are informed about risks from cybersecurity threats by the Executive Board and security executives, with additional input from SAP’s Global Security & Cloud Compliance organization (SGSC), the Global Risk & Assurance Services organization (GR&AS), SAP Legal, Business Information Security Officers (BISOs), and internal and external cybersecurity and legal consultants. SAP’s Global Security & Cloud Compliance Office reports regularly to the PTC and to the ACC, as well as upon request and the occurrence of certain findings. In addition, the PTC and ACC often participate in meetings with the Executive Board or members thereof and security executives for the purpose of receiving information on and discussing SAP’s cybersecurity risks and risk management approach. The PTC and ACC participate in key decisions on cybersecurity-related issues, including risk materiality assessments, incident response and the provision of any necessary related disclosures.
(2)Executive Board’s Role in Assessing and Managing SAP’s Material Risks from Cybersecurity Threats
(i) Executive Board Role in Assessing and Managing Material Risks from Cybersecurity Threats and Executive Board Expertise
The Executive Board is responsible for assessing and managing material risks, including cybersecurity risks. Specifically, the Executive Board supervises SAP’s efforts to prevent, detect, mitigate, and remediate cybersecurity risks through various means, including briefings from SAP security personnel and other SAP personnel involved in cybersecurity matters; threat detection and other intelligence information obtained from governmental, public, or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment. In addition, the Executive Board supervises SAP’s internal cybersecurity personnel.
(ii) Executive Board – Briefing on and Monitoring of Cybersecurity Risks and Incidents
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SAP Global Security & Cloud Compliance
SGSC is co-led by SAP’s CSO and its CSCRO, both of whom report to the Member of the Executive Board for Customer Service & Delivery. SGSC is responsible for areas such as product and application security, cyber defense, operational security risk management, security compliance, physical security, as well as the Trust Office that supports customers and partners with security-related issues. SGSC coordinates with SAP Legal and reports to the ACC and/or the PTC as well as the Executive Board regarding the prevention, detection, mitigation and remediation of cybersecurity risks and incidents, including assessments of the materiality of cybersecurity risks and incidents. In addition, the SGSC reports to the Executive Board, the PTC and/or ACC as necessary outside of the quarterly reporting cadence on any potentially material cybersecurity risks and incidents.
Business Information Security Officers (BISO)
Each of SAP’s product Lines of Business (LOB) has a BISO, who is a senior security leader assigned to manage the security strategy and operations of the LOB and coordinate with other BISOs through a BISO Council reporting to our CSO. These BISOs serve many important functions, including managing SAP’s risk within each LOB. It is the responsibility of each BISO to supervise and monitor the specific risks associated with their respective LOB. This facilitates the reporting of security threats to the Security & Risk Assurance (SRA) Team through the local unit risk coordinator. The SRA Team evaluates and measures the security risks using a cyber risk quantification tool. Once validated, these risks are recorded and included in the Global Enterprise risk register and subject to risk mitigation actions. In the event of an incident, the BISO helps manage the event and support the CSO, CSCRO and, ultimately, the Executive Board in their decision-making processes. BISOs are supported by local security resources to assist with implementing SAP’s security strategy and protections within the business and technology context best suited for the LOB in question. BISOs and SAP Legal coordinate on significant cybersecurity risks and incidents impacting their LOB.
Risk Coordinator
A Risk Coordinator assumes the delegated responsibilities of the business unit head to support risk management activities in the relevant areas of responsibility. However, not every LOB necessarily has a dedicated Risk Coordinator if the Business Unit Head is directly involved.
Global Risk & Assurance Services Organization
SAP’s GR&AS organization, led by our Chief Risk Officer/Chief Audit Executive (CRO), provides regular updates to the ACC, the PTC, and the Executive Board on SAP’s risk management systems and risks meeting SAP’s internal risk threshold. The CRO reports to SAP’s Group CFO and is responsible for designing and implementing SAP’s risk management system, with oversight by the Executive Board.
Cybersecurity Control Team
SAP maintains a cross functional cybersecurity control team consisting of the CSO, the CSCRO, SVP Legal - Litigation and Cybersecurity, Chief Cybersecurity Counsel, Senior Corporate & Securities Counsel, Group Data Protection Officer & Head of SAP Data Protection, and members of SAP’s Global Accounting, Reporting & Tax department. This group meets on both a quarterly and an ad hoc basis to review cybersecurity issues, including but not limited to actual and potential cybersecurity incidents, thwarted attempts, cyber-related risks, and internal investigations (collectively, cybersecurity events). As part of its review and assessment, this group evaluates the implications, if any, of the cybersecurity events on SAP’s external reporting. Where appropriate, matters are escalated and discussed among SAP’s General Counsel, the Executive Board, the PTC and/or the ACC. Assessments ensue at this level with senior leaders from the Cybersecurity Control Team and cybersecurity consultants who provide the Executive Board, the PTC and/or the ACC with updates on an as-needed basis and in SAP Security briefings. SAP discusses any significant cybersecurity events, their impact on SAP's external reporting.
Employee Cybersecurity Education, Training and Compliance
As part of its risk mitigation strategy, SGSC conducts annual mandatory security training programs that provide education on key cybersecurity risks and specific threat profiles. A comprehensive portfolio of offerings is made available to the SAP workforce to address the diverse threats faced by organizations such as SAP and to reinforce SAP’s expectations of its employees. In addition to this regular education, the Executive Board, the PTC and the ACC receive training on cybersecurity topics from our CSO, CSCRO and internal security staff as part of the continuing education on cybersecurity topics that impact public companies.
Executive Clearing Board
In 2025 the Executive Board endorsed the creation of a new Executive Clearing Board (ECB) to enhance oversight of critical cross-board area topics and domains related to regulatory obligations, audits, product certifications, and attestations. The ECB provides an independent, high-level review, and escalation body for complex or cross-domain regulatory issues where accountability is unclear, ensuring strong governance while streamlining what is elevated to the Executive Board.
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(iii) Executive Board Reporting of Cybersecurity Risks to the ACC and the PTC of the Supervisory Board
Executive Board regularly reports cybersecurity risks and incidents to the PTC and ACC, as outlined above, with a focus on significant risks and incidents. This reporting occurs through various processes with input from SGSC, GR&AS, SAP Legal, BISOs and internal and external cybersecurity and legal consultants. Additionally, the Executive Board often participates in meetings with each of the PTC and the ACC on cybersecurity-related issues, including risk materiality assessments, incident response, third party audit matters and the provision of any necessary related disclosures. In the case of a significant cybersecurity incident, the Executive Board, the PTC and/or the ACC coordinate as necessary with others both within SAP (including with respect to any significant cybersecurity incidents, the Disclosure Committee) and any outside experts involved in the matter on the determination of the materiality of cybersecurity risks and incidents to SAP and the provision of any related disclosures. Since SAP is a reporting entity under both German and U.S. laws, SAP adheres to both the Ad Hoc reporting requirements of the European Market Abuse Regulation and the U.S. federal securities laws requirements for periodic and annual disclosures.
PART III
ITEM 17. FINANCIAL STATEMENTS
Not applicable.
ITEM 18. FINANCIAL STATEMENTS
The Consolidated Financial Statements are included herein on pages F-1 through F-110.
The following are filed as part of this report:
- | Report of Independent Registered Public Accounting Firm. |
- | Consolidated Financial Statements |
| ● | Consolidated Income Statements for the years ended December 31, 2025, 2024, and 2023. |
| ● | Consolidated Statements of Comprehensive Income for the years ended December 31, 2025, 2024, and 2023. |
| ● | Consolidated Statements of Financial Position as of December 31, 2025, and 2024. |
| ● | Consolidated Statements of Changes in Equity for the years ended December 31, 2025, 2024, and 2023. |
| ● | Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024, and 2023. |
| ● | Notes to the Consolidated Financial Statements. |
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ITEM 19. EXHIBITS
The following documents are filed as exhibits to this report:
1 | Articles of Incorporation (Satzung) of SAP SE, effective as of July 15, 2025 (English translation). 1 |
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2.1 | Form of global share certificate for ordinary shares (English translation). 2 |
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4.1.1 | Amended and Restated Deposit Agreement dated as of November 25, 2009, by and among SAP SE, Deutsche Bank Trust Company Americas as Depositary, and all owners and holders from time to time of American Depositary Receipts issued thereunder. 3 |
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4.1.2 | Amendment No. 1 dated March 18, 2016 to the Amended and Restated Deposit Agreement, by and among SAP SE, Deutsche Bank Trust Company Americas as Depositary, and all owners and holders from time to time of American Depositary Receipts issued thereunder, including the form of American Depositary Receipt. 4 |
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8 | For a list of our subsidiaries see Note (G.9) to our Consolidated Financial Statements in “Item 18. Financial Statements”. |
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11.1 | SAP Global Insider Regulations Policy.5 |
11.2 | SAP U.S. Insider Trading Policy.6 |
12.1 | Certification of Christian Klein, Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a). |
12.2 | Certification of Dominik Asam, Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a). |
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13.1 | Certification of Christian Klein, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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13.2 | Certification of Dominik Asam, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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15 | Consent of BDO, Independent Registered Public Accounting Firm. |
97 | SAP SE Clawback Policy7 |
101.INS | iXBRL Instance Document |
101.SCH | iXBRL Taxonomy Schema Linkbase Document |
101.CAL | iXBRL Taxonomy Calculation Linkbase Document |
101.DEF | iXBRL Taxonomy Definition Linkbase Document |
101.LAB | iXBRL Taxonomy Labels Linkbase Document |
101.PRE | iXBRL Taxonomy Presentation Linkbase Document |
104.Cover Page | Interactive Data File (formatted as Inline XBRL and included in Exhibit 101) |
1 | Incorporated by reference to Exhibit 4.1 to SAP SE’s Registration Statement on Form S - 8 filed with the SEC on November 14, 2025. |
2 | Incorporated by reference to Exhibit 2.1 to SAP SE’s 2014 Annual Report on Form 20-F filed with the SEC on March 20, 2015. |
3 | Incorporated by reference to Exhibit 99.(a)(2) of Post Effective Amendment #1 to SAP SE’s Registration Statement on Form F-6 filed on November 25, 2009. |
4 | Incorporated by reference to Exhibit 99.(a)(2) of Post Effective Amendment #2 to SAP SE’s Registration Statement on Form F-6 filed on March 18, 2016 |
5 Incorporated by reference to Exhibit 11.1 to SAP SE’s 2024 Annual Report on Form 20-F filed with the SEC on February 27, 2025
6 Incorporated by reference to Exhibit 11.2 to SAP SE’s 2024 Annual Report on Form 20-F filed with the SEC on February 27, 2025
7 | Incorporated by reference to Exhibit 97 of SAP SE’s Annual Report on Form 20 - F for the fiscal year ended December 31, 2023 filed with the SEC on February 29, 2024. |
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Signatures
The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this report on its behalf.
| SAP SE | ||
| (Registrant) | ||
| By: | /s/ CHRISTIAN KLEIN | |
|
| ||
| Name: Christian Klein | ||
| Title: Chief Executive Officer | ||
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|
| ||
Dated: February 26, 2026 | |||
By: | /s/ DOMINIK ASAM | ||
Name:Dominik Asam | |||
Title: Chief Financial Officer | |||
Dated: February 26, 2026 | |||
SAP SE AND SUBSIDIARIES | |||
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Index to the Consolidated Financial Statements
Page | |
Reports of Independent Registered Public Accounting Firm ( | F-2 |
Consolidated Financial Statements: | |
Consolidated Income Statements for the years ended December 31, 2025, 2024 and 2023 | F-5 |
Consolidated Statements of Comprehensive Income for the years ended December 31, 2025, 2024 and 2023 | F-6 |
Consolidated Statements of Financial Position as of December 31, 2025 and 2024 | F-7 |
Consolidated Statements of Changes in Equity for the years ended December 31, 2025, 2024 and 2023 | F-8 |
Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024 and 2023 | F-9 |
Notes to the Consolidated Financial Statements | F-10 to F-110 |
F-1
Table of Contents
Report of Independent Registered Public Accounting Firm
To the Shareholders and Supervisory Board of SAP SE:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated statements of financial position of SAP SE (the “Company”) as of December 31, 2025 and 2024, the related consolidated income statements, consolidated statements of comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board (IFRS).
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and our report dated February 18, 2026, expressed an unqualified opinion thereon.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements; and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Cloud revenue recognition
As discussed in note A.1 to the consolidated financial statements, the Company generated revenue in 2025 of EUR 36,800 million, of which EUR 21,023 million relates to cloud revenues from fees earned from providing customers a cloud offering with software as a service, platform as a service, infrastructure as a service and/or premium cloud support through subscriptions for use of the Company’s cloud solutions. For most of the Company’s cloud offerings, measured both in volume and number, the customer is entitled to continuously access and use one or more cloud solutions for a specified term, therefore cloud revenue is recognized based on time elapsed and thus ratably over the term of access. However, some cloud business models are provisioned on a consumption basis where a customer commits to a fixed value of spend on cloud services throughout the contract term, but with the discretion to call off cloud services on an as needed basis. For those arrangements cloud revenue is recognized based on consumption as it best reflects the measure towards satisfaction of the performance obligation(s).
We identified cloud revenue recognition of certain contracts as a critical audit matter. The principal considerations that led to the determination are the complex auditor judgments required to evaluate: (1) whether certain agreements with the same customer were economically linked and need to be combined; (2) whether the various services that are owed by the Company according to the contract qualified as separate performance obligations; (3) the allocation of the transaction price of a customer contract to the performance obligations in the contract based on standalone-selling prices; and (4) the point in time at which the provision of services by the Company for the specific performance obligation commences. Auditing these elements involved especially challenging and complex auditor judgment due to the complex nature of certain of the Company’s customer contracts and extent of audit effort required to address these matters.
F-2
Table of Contents
The primary procedures we performed to address this critical audit matter included: (1) testing the design and the operating effectiveness of certain internal controls related to the revenue process, including controls related to the identification of certain economically linked agreements and separate performance obligations, the allocation of the transaction price to the performance obligations in certain contracts, and the point in time at which the provisioning of service commenced; (2) testing a sample of underlying contractual agreements and other related documents to evaluate the Company’s assessment of whether certain agreements were economically linked, the identified performance obligations, the allocation of the transaction price and the point in time at which the provision of service for the performance obligations identified commenced; and (3) testing key contractual terms and conditions from the respective contracts to evaluate the identified performance obligations and the point in time at which the provision of service for the identified performance obligations commenced.
Assessment of the Company’s uncertain tax treatments
As discussed in note C.5 to the consolidated financial statements, the Company disclosed contingent liabilities relating to tax uncertainties of EUR 1,187 million. The Company operates in multiple tax jurisdictions which continually revise, change, and implement tax laws with complexities and uncertainties due to different interpretations of these tax laws, especially relating to the deductibility of intercompany royalty payments and intercompany services. The nature of these activities can result in uncertainties in the estimation of the related tax exposures.
We identified the assessment of the Company’s tax provision associated with uncertain tax positions, specifically related to the deductibility of intercompany royalty payments and intercompany services, as a critical audit matter. The principal considerations that led to the determination included complex auditor judgement related to: (1) auditing key assumptions applied to the interpretation of tax laws, related regulations, case laws, and mutual agreement procedures across multiple jurisdictions; (2) determining whether a tax position from the deductibility of intercompany royalty payments and intercompany services is more-likely-than-not to be sustained. Auditing these elements involved especially challenging and complex auditor judgment due to the nature and extent of audit effort required to address these matters, including involvement of personnel with specialized skills and knowledge.
The primary procedures we performed to address this critical audit matter included utilizing personnel with specialized skill and knowledge in taxation to evaluate the appropriateness of management’s methods and key assumptions used to estimate certain uncertain tax positions by: (1) assessing for certain company business activities the reasonableness and consistency of management’s judgment in the interpretation of relevant tax regulations; (2) evaluating the significant assumptions underlying the interpretation of relevant tax laws and related interpretations, relevant case law, and mutual agreement procedures in the respective tax jurisdictions; and (3) assessing the overall reasonableness of conclusions reached regarding the identification, recognition, measurement, and disclosure of certain uncertain tax positions related to the deductibility of intercompany royalty payments and intercompany services.
Measurement of unlisted equity securities
As discussed in note F.2 to the consolidated financial statements, the Company holds unlisted equity securities held at fair value of EUR 6,324 million as of December 31, 2025, primarily relating to Sapphire Ventures’ investments. These investments in unlisted equity securities are classified as financial instruments at fair value through profit and loss requiring a recurring fair value measurement using significant unobservable inputs.
We identified the measurement of certain unlisted equity securities at fair value as a critical audit matter due to the significant measurement uncertainty associated with the fair value of such investments relating to significant unobservable inputs used, such as the selection of appropriate comparable company data, in deriving revenue multiples as well as forecasted performance of the investees. Auditing these elements involved especially challenging and subjective auditor judgment due to the extent of specialized skills or knowledge needed.
The primary audit procedures we performed to address this critical audit matter included utilizing personnel with specialized knowledge and skill in valuation to assist in assessing and evaluating the appropriateness of the valuation technique used for a selection of certain investments in unlisted equity securities relating to Sapphire Ventures’ investments by: (1) assessing the appropriateness of the valuation technique selected by comparing it to our expectation based on industry experience and knowledge of the investment; (2) assessing the source, reliability and relevance of evidence used in determining significant unobservable inputs; (3) evaluating the significant unobservable inputs considered in the recurring measurement of fair value by comparing them to historical and market information; and (4) developing an independent range of acceptable fair value estimates utilizing available market information from third party sources to assess whether management’s estimates are reasonable.
/s/ BDO AG Wirtschaftsprüfungsgesellschaft
We have served as the Company’s auditor since 2023.
Frankfurt am Main, Germany
February 18, 2026
F-3
Table of Contents
Report of Independent Registered Public Accounting Firm
To the Shareholders and Supervisory Board of SAP SE:
Opinion on Internal Control over Financial Reporting
We have audited SAP SE’s (the “Company’s”) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO criteria”). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated statements of financial position of the Company as of December 31, 2025 and 2024, the related consolidated income statements and the consolidated statements of comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and our report dated February 18, 2026, expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Item 15, Controls and Procedures. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit of internal control over financial reporting in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ BDO AG Wirtschaftsprüfungsgesellschaft
Frankfurt am Main, Germany
February 18, 2026
F-4
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Consolidated Financial Statements IFRS
Consolidated Income Statements of SAP Group for the Years Ended December 31
€ millions, unless otherwise stated | | Notes | | 2025 | | 2024 | | 2023 |
Cloud |
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Software licenses |
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Software support |
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Software licenses and support |
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Cloud and software |
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Services |
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Total revenue |
| (A.1), (C.2) |
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Cost of cloud |
| - |
| - |
| - | ||
Cost of software licenses and support |
| - |
| - |
| - | ||
Cost of cloud and software |
| - |
| - |
| - | ||
Cost of services |
| - |
| - |
| - | ||
Total cost of revenue |
| - |
| - |
| - | ||
Gross profit |
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Research and development | (D.9) |
| - |
| - |
| - | |
Sales and marketing |
| - |
| - |
| - | ||
General and administration |
| - |
| - |
| - | ||
Restructuring |
| (B.6) |
| - |
| - |
| - |
Other operating income/expense, net |
| - |
| - |
| - | ||
Total operating expenses |
| - |
| - |
| - | ||
Operating profit |
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Other non-operating income/expense, net |
| (C.3) |
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| - |
| - |
Finance income |
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Finance costs |
| - |
| - |
| - | ||
Financial income, net |
| (C.4) |
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| - |
Profit before tax from continuing operations | (C.2) |
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Income tax expense |
| (C.5) |
| - |
| - |
| - |
Profit after tax from continuing operations |
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Attributable to owners of parent |
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Attributable to non-controlling interests |
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Profit (loss) after tax from discontinued operations | (D.1) | | | | ||||
Profit after tax1 | | | | |||||
Attributable to owners of parent1 | | | | |||||
Attributable to non-controlling interests1 | | | - | |||||
Earnings per share, basic (in €) from continuing operations | (C.6) | | | | ||||
Earnings per share, basic (in €)1 | (C.6) | | | | ||||
Earnings per share, diluted (in €) from continuing operations |
| (C.6) |
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Earnings per share, diluted (in €)1 |
| (C.6) |
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1 from continuing and discontinued operations
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-5
Table of Contents
Consolidated Statements of Comprehensive Income of SAP Group for the Years Ended December 31
€ millions | | Notes | | 2025 | | 2024 | | 2023 |
Profit after tax1 | |
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Items that will not be reclassified to profit or loss |
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Remeasurements on defined benefit pension plans, before tax | - |
| - |
| - | |||
Income taxes relating to remeasurements on defined benefit pension plans |
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Remeasurements on defined benefit pension plans, net of tax | - |
| - |
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Other comprehensive income for items that will not be reclassified to profit or loss, net of tax | - |
| - |
| - | |||
Items that will be reclassified subsequently to profit or loss |
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Gains (losses) on exchange differences on translation, before tax | - |
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| - | |||
Reclassification adjustments on exchange differences on translation, before tax | - |
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Exchange differences, before tax | - |
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Income taxes relating to exchange differences on translation |
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Exchange differences, net of tax |
| (E.2) | - |
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| - | |
Gains (losses) on cash flow hedges/cost of hedging, before tax | |
| - |
| - | |||
Reclassification adjustments on cash flow hedges/cost of hedging, before tax | - |
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Cash flow hedges/cost of hedging, before tax |
| (F.1) | |
| - |
| - | |
Income taxes relating to cash flow hedges/cost of hedging |
| - |
| |
| | ||
Cash flow hedges/cost of hedging, net of tax |
| (E.2) | |
| - |
| - | |
Other comprehensive income for items that will be reclassified to profit or loss, net of tax | - |
| |
| - | |||
Other comprehensive income, net of tax | - |
| |
| - | |||
Total comprehensive income | |
| |
| | |||
Attributable to owners of parent | |
| |
| | |||
Attributable to non-controlling interests | |
| |
| - |
1 from continuing and discontinued operations
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-6
Table of Contents
/ Consolidated Statements of Financial Position of SAP Group as at December 31
€ millions | | Notes | | 2025 | | 2024 |
Cash and cash equivalents | (E.3) |
| |
| | |
Other financial assets |
| (D.6), (E.3) |
| |
| |
Trade and other receivables |
| (A.2) |
| |
| |
Other non-financial assets |
| (A.3), (G.1) |
| |
| |
Tax assets |
| |
| | ||
Total current assets |
| |
| | ||
Goodwill |
| (D.2) |
| |
| |
Intangible assets |
| (D.3) |
| |
| |
Property, plant, and equipment |
| (D.4), (D.5) |
| |
| |
Other financial assets |
| (D.6), (E.3) |
| |
| |
Trade and other receivables |
| (A.2) |
| |
| |
Other non-financial assets |
| (A.3), (G.1) |
| |
| |
Tax assets |
| |
| | ||
Deferred tax assets |
| (C.5) |
| |
| |
Total non-current assets |
| |
| | ||
Total assets |
| |
| | ||
Trade and other payables |
|
| |
| | |
Tax liabilities |
| |
| | ||
Financial liabilities |
| (E.3), (D.5) |
| |
| |
Other non-financial liabilities |
| (B.3), (B.5), (G.2) |
| |
| |
Provisions |
| (A.4), (B.6), (G.2), (G.3) |
| |
| |
Contract liabilities |
| (A.1) |
| |
| |
Total current liabilities |
| |
| | ||
Trade and other payables |
|
| |
| | |
Tax liabilities |
| |
| | ||
Financial liabilities |
| (E.3), (D.5) |
| |
| |
Other non-financial liabilities |
| (B.3), (B.5), (G.2) |
| |
| |
Provisions |
| (A.4), (B.4), (B.6), (G.2) |
| |
| |
Deferred tax liabilities |
| (C.5) |
| |
| |
Contract liabilities |
| (A.1) |
| |
| |
Total non-current liabilities |
| |
| | ||
Total liabilities |
| |
| | ||
Issued capital |
| |
| | ||
Share premium |
| |
| | ||
Retained earnings |
| |
| | ||
Other components of equity |
| |
| | ||
Treasury shares |
| - |
| - | ||
Equity attributable to owners of parent |
| |
| | ||
Non-controlling interests | (E.2) |
| |
| | |
Total equity |
| (E.2) |
| |
| |
Total equity and liabilities |
| |
| |
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-7
Table of Contents
Consolidated Statements of Changes in Equity of SAP Group for the Years Ended December 31
Equity Attributable to Owners of Parent | ||||||||||||||||
| | | | Other | | | | Non- | | |||||||
Share | Retained | Components | Treasury | Controlling | ||||||||||||
€ millions | Issued Capital | Premium | Earnings | of Equity | Shares | Total | Interests | Total Equity | ||||||||
Notes |
| (E.2) |
| (E.2) |
| (E.2) |
| (E.2) |
| (E.2) |
| |
| (E.2) |
| |
1/1/2023 | | | | | - | | | | ||||||||
Profit after tax1 |
|
| |
|
|
| |
| - |
| | |||||
Other comprehensive income |
|
| - |
| - |
|
| - |
| - |
| - | ||||
Comprehensive income |
|
|
| |
| - |
|
| |
| - |
| | |||
Share-based payments |
|
| |
|
|
|
| |
| |
| | ||||
Dividends |
|
|
| - |
|
|
| - |
| - |
| - | ||||
Purchase of treasury shares | |
|
|
| |
| - |
| - |
| |
| - | |||
Reissuance of treasury shares under share-based payments |
| | | | ||||||||||||
Changes in non-controlling interests | - | | - | - | - | |||||||||||
Other changes |
|
|
| |
|
|
| |
| - |
| | ||||
12/31/2023 | |
| |
| |
| |
| - |
| |
| |
| | |
Profit after tax |
| | | | | |||||||||||
Other comprehensive income |
| - | | | | | ||||||||||
Comprehensive income |
| | | | | | ||||||||||
Share-based payments, before tax |
| | | | ||||||||||||
Income taxes relating to share-based payments | | | | |||||||||||||
Dividends |
| - | - | - | - | |||||||||||
Purchase of treasury shares |
| - | - | - | ||||||||||||
Reissuance of treasury shares under share-based payments | | | | |||||||||||||
Other changes |
| - | | - | | - | ||||||||||
12/31/2024 | | | | | - | | | | ||||||||
Profit after tax |
| | | | | |||||||||||
Other comprehensive income |
| - | - | - | - | - | ||||||||||
Comprehensive income |
| | - | | | | ||||||||||
Share-based payments, before tax |
| | | | ||||||||||||
Income taxes relating to share-based payments | | | | |||||||||||||
Dividends |
| - | - | - | - | |||||||||||
Purchase of treasury shares | - | - | - | |||||||||||||
Reissuance of treasury shares under share-based payments | | | | |||||||||||||
Other changes |
| | | | | | ||||||||||
12/31/2025 | | | | | - | | | | ||||||||
1
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-8
Table of Contents
Consolidated Statements of Cash Flows of SAP Group for the Years Ended December 31
€ millions | | Notes | | 20253 | | 2024 | | 2023 |
Profit (loss) after tax1 |
| |
| |
| |
| |
Adjustments to reconcile profit (loss) after tax to net cash flows from operating activities: |
| |
|
|
| |||
(Profit) loss after tax from discontinued operations | | | - | |||||
Depreciation and amortization |
| (D.2)–(D.4) |
| |
| |
| |
Share-based payment expense | (B.3) | | | | ||||
Income tax expense |
| (C.5) |
| |
| |
| |
Financial income, net |
| (C.4) |
| - |
| - |
| |
Increase/decrease in allowances on trade receivables |
| |
| |
| |
| - |
Other adjustments for non-cash items |
| |
| |
| |
| |
Increase/decrease in trade and other receivables |
| |
| - |
| - |
| - |
Increase/decrease in other assets |
| |
| - |
| - |
| - |
Increase/decrease in trade payables, provisions, and other liabilities |
| |
| - |
| |
| |
Increase/decrease in contract liabilities |
| |
| |
| |
| |
Share-based payments |
| (B.3) | - | - | - | |||
Income taxes paid, net of refunds2 |
| |
| - |
| - |
| - |
Net cash flows from operating activities – continuing operations | | | | |||||
Net cash flows from operating activities – discontinued operations | (D.1) | | | | ||||
Net cash flows from operating activities1 |
| |
| |
| |
| |
Business combinations, net of cash and cash equivalents acquired | - | - | - | |||||
Cash flows from derivative financial instruments related to the sale of subsidiaries or businesses | | | - | |||||
Purchase of intangible assets and property, plant, and equipment |
| |
| - |
| - |
| - |
Proceeds from sales of intangible assets and property, plant, and equipment |
| |
| |
| |
| |
Purchase of equity or debt instruments of other entities |
| |
| - |
| - |
| - |
Proceeds from sales of equity or debt instruments of other entities |
| |
| |
| |
| |
Interest received | | | | |||||
Net cash flows from investing activities – continuing operations | - | - | - | |||||
Net cash flows from investing activities – discontinued operations | (D.1) | | | | ||||
Net cash flows from investing activities1 |
| |
| - |
| - |
| |
Dividends paid |
| (E.2) |
| - |
| - |
| - |
Dividends paid on non-controlling interests | - | - | - | |||||
Purchase of treasury shares | (E.2) | - | - | - | ||||
Proceeds from borrowings |
| (E.3) |
| |
| |
| |
Repayments of borrowings |
| (E.3) |
| - |
| - |
| - |
Payments of lease liabilities | - | - | - | |||||
Transactions with non-controlling interests |
| (E.2) |
| |
| - |
| |
Interest paid | - | - | - | |||||
Net cash flows from financing activities – continuing operations | - | - | - | |||||
Net cash flows from financing activities – discontinued operations | (D.1) | | | | ||||
Net cash flows from financing activities1 |
| |
| - |
| - |
| - |
Effect of foreign currency rates on cash and cash equivalents |
| |
| - |
| |
| - |
Net increase/decrease in cash and cash equivalents |
| |
| - |
| |
| - |
/ Cash and cash equivalents at the beginning of the period |
| (E.3) |
| |
| |
| |
/ Cash and cash equivalents at the end of the period |
| (E.3) |
| |
| |
| |
1
2
3
The accompanying Notes are an integral part of these Consolidated Financial Statements.
F-9
Table of Contents
SAP SE AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(IN.1) Basis for Preparation
General Information
The registered domicile of SAP SE is in Walldorf, Germany (Commercial Register of the Lower Court of Mannheim HRB 719915). The Consolidated Financial Statements for 2025 of SAP SE and its subsidiaries (collectively, “we,” “us,” “our,” “SAP,” “Group,” and “Company”) have been prepared in accordance with International Financial Reporting Standards (IFRS) and the additional requirements set forth in section 315e (1) of the German Commercial Code (HGB).
We have applied all IFRS standards and interpretations that were effective on and endorsed by the European Union (EU) as at December 31, 2025. There were no standards or interpretations as at December 31, 2025, impacting our Consolidated Financial Statements for the years ended December 31, 2025, 2024, and 2023, that were effective but not yet endorsed. Therefore, our Consolidated Financial Statements comply with both, IFRS as issued by the International Accounting Standards Board (IASB) and IFRS as endorsed by the EU.
Our Executive Board approved the Consolidated Financial Statements on February 18, 2026, for submission to our Supervisory Board which approved the Consolidated Financial Statements on the same day.
All amounts included in the Consolidated Financial Statements are reported in millions of euros (€ millions) except where otherwise stated. As figures are rounded, numbers presented throughout this document may not add up precisely to the totals we provide and percentages may not precisely reflect the absolute figures.
Amounts disclosed in the Notes that are taken directly from our Consolidated Income Statements or our / Consolidated Statements of Financial Position are marked with the symbols and /, respectively.
Furthermore, all financial numbers in the Consolidated Financial Statements are based on continuing operations (unless otherwise noted).
Accounting Policies, Management Judgments, and Sources of Estimation Uncertainty
How We Present Our Accounting Policies, Judgments, and Estimates
To ease the understanding of our financial statements, we present the accounting policies, management judgments, and sources of estimation uncertainty (hereafter: accounting policies, judgments, and estimates) on a given subject together with other disclosures related to the same subject in the Note that deals with this subject. Accounting policies, judgments, and estimates that do not relate to a specific subject are presented in the following section.
For easier identification of our accounting policies, judgments, and estimates, the respective disclosures are marked with the symbol y and highlighted with a light gray box. They focus on the accounting choices made within the framework of the prevailing IFRS and refrain from repeating the underlying promulgated IFRS guidance, unless we consider it particularly important to the understanding of a Note’s content.
F-10
Table of Contents
The following table provides an overview of where our accounting policies, management judgments, and estimates are disclosed:
Note | | y Accounting Policies, Judgments, and Estimates |
(IN.1) | Basis for Preparation | |
(A.1) | Revenue | |
(A.2) | Trade and Other Receivables | |
(A.3) | Capitalized Cost from Contracts with Customers | |
(A.4) | Customer-Related Provisions | |
(B.3) | Share-Based Payments | |
(B.4) | Pension Plans and Similar Obligations | |
(B.5) | Other Employee-Related Obligations | |
(B.6) | Restructuring | |
(C.1) | Results of Segments | |
(C.5) | Income Taxes | |
(D.1) | Business Combinations and Divestitures | |
(D.2) | Goodwill | |
(D.3) | Intangible Assets | |
(D.4) | Property, Plant, and Equipment | |
(D.5) | Leases | |
(D.6) | Equity Investments | |
(D.9) | Government Grants | |
(E.2) | Total Equity | |
(E.3) | Liquidity | |
(F.1) | Financial Risk Factors and Risk Management | |
(F.2) | Fair Value Disclosures on Financial Instruments | |
(G.3) | Other Litigation, Claims, and Legal Contingencies | |
(G.5) | Executive and Supervisory Board Compensation |
y General Accounting Policies
Bases of Measurement
The Consolidated Financial Statements have been prepared on the historical cost basis except for the following:
- Derivative financial instruments, liabilities for cash-settled share-based payments, and financial assets with cash flows that are not solely payments of principal or interest are measured at fair value.
- Post-employment benefits are measured at the present value of the defined benefit obligations less the fair value of the plan assets.
- Monetary assets and liabilities denominated in foreign currencies are translated at period-end exchange rates.
- Provisions are recognized at the best estimate of their fulfillment amount when they occur.
Foreign Currencies
Income and expenses and operating cash flows of our foreign subsidiaries that use a functional currency other than the Euro are translated at average rates of foreign exchange (FX) computed on a monthly basis. Exchange differences resulting from foreign currency transactions are recognized in other non-operating income/expense, net.
F-11
Table of Contents
The exchange rates of key currencies affecting the Company were as follows:
Exchange Rates
Middle Rate | ||||||||||||
as at 12/31 | Annual Average Exchange Rate | |||||||||||
Equivalent to €1 | | | 2025 | | 2024 | | 2025 | | 2024 | | 2023 | |
Australian dollar |
| AUD |
| |
| |
| |
| |
| |
Canadian dollar |
| CAD |
| |
| |
| |
| |
| |
Swiss franc |
| CHF |
| |
| |
| |
| |
| |
Pound sterling |
| GBP |
| |
| |
| |
| |
| |
Japanese yen |
| JPY |
| |
| |
| |
| |
| |
U.S. dollar |
| USD |
| |
| |
| |
| |
| |
Cost Classification
Cost of Cloud and Software
Cost of cloud and software includes the costs incurred in providing the services and producing the goods that generate cloud and software revenue. Consequently, this line item primarily includes employee expenses relating to these services, amortization of acquired intangibles, fees for third-party licenses, depreciation of our property, plant, and equipment (for example, of our data centers in which we host our cloud solutions), and costs for third-party hosting services. For more information about the capitalization of costs from contracts with customers, see Note (A.3).
Cost of Services
Cost of services includes the costs incurred in providing the services that generate service revenue. Consequently, this line item primarily includes employee expenses and related training, system and system administration costs, and costs for third-party resources.
Research and Development
Research and development includes the costs incurred by activities related to the development of cloud and software solutions including resource and hardware costs for the development systems. The same applies for activities related to changes in the code of SAP’s cloud and software solutions. For more information about the recognition of internally generated intangible assets from development, see Note (D.3).
Sales and Marketing
Sales and marketing includes the costs incurred for the selling activities (such as sales commissions and amortization of capitalized sales commissions) and marketing activities related to our software and cloud solutions and our service portfolio. For more information about the capitalization of costs from contracts with customers, see Note (A.3).
General and Administration
General and administration includes the costs related to finance and administrative functions, human resources, and general management as long as they are not directly attributable to one of the other operating expense line items.
Updated Accounting Policy for the Presentation of Interest Paid and Interest Received
As of 2025, SAP updated the presentation of its Consolidated Statements of Cash Flows to better reflect management’s view of the underlying business activities. Interest paid and interest received are no longer classified within net cash flows from operating activities.
Interest paid is now presented within net cash flows from financing activities, and interest received within net cash flows from investing activities, as these cash flows are not considered part of SAP’s operating activities. Prior-year amounts have been reclassified for comparability. The updated presentation is consistent with the requirements of IFRS 18.
F-12
Table of Contents
y Management Judgments and Sources of Estimation Uncertainty
The preparation of the Consolidated Financial Statements requires our management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues, and expenses, as well as disclosure of contingent liabilities.
We base our judgments, estimates, and assumptions on historical and forecast information, and on regional and industry economic conditions in which we or our customers operate. Changes to these conditions could adversely affect our estimates. Although we believe we have made reasonable estimates about the ultimate resolution of the underlying uncertainties, no assurance can be given that the final outcome of these matters will be consistent with what is reflected in our recognized assets, liabilities, revenues, and expenses and disclosed contingent liabilities. Actual results could differ significantly from original estimates.
The accounting policies that most frequently or significantly require us to make judgments, estimates, and assumptions, and therefore are critical to understanding our results of operations, include the following:
Note | | y Material Accounting Policies |
(A.1) | Revenue recognition | |
(A.2) | Valuation of trade receivables | |
(A.4), (G.3) | Accounting for legal contingencies | |
(B.3) | Accounting for share-based payments | |
(C.5) | Accounting for income taxes | |
(D.1) | Accounting for business combinations | |
(D.2) | Accounting for goodwill | |
(D.3) | Accounting for intangible assets (including recognition of internally generated intangible assets from development) | |
(D.6) | Accounting for equity investments |
Our management periodically discusses these material accounting policies with the Audit and Compliance Committee of our Supervisory Board.
y New Accounting Standards Not Yet Adopted
The IASB has issued various amendments to the IFRS standards (such as IFRS 9 and IFRS 7 (Amendments to the Classification, Measurement, and Disclosure of Financial Instruments)) that are relevant for SAP but not yet effective. We are currently assessing the impact of IFRS 9 and IFRS 7 (Amendments to the Classification, Measurement, and Disclosure of Financial Instruments) on SAP, but do not expect material effects on our financial position or profit after tax.
In April 2024, the IASB released IFRS 18 (Presentation and Disclosure in Financial Statements). The new standard will affect the presentation of our Consolidated Income Statements, introduce additional disclosure requirements, and further specify aggregation and disaggregation of information in our Notes to the Consolidated Financial Statements. IFRS 18 will become effective on January 1, 2027.
The main purpose of IFRS 18 is to increase transparency and comparability of financial performance between reporting entities. When the new standard becomes effective, the structure of SAP’s Consolidated Income Statements, as well as the definition of operating profit, will change to comply with the new requirements.
SAP has performed preliminary evaluations of its financial reporting under IFRS 18. However, mainly due to outstanding decisions and clarifications by international and national standard-setting bodies (such as the IASB’s pending decision regarding the treatment of foreign currency fluctuations arising from intercompany loans), the overall impact of IFRS 18 on operating profit cannot yet be determined. With the introduction of IFRS 18, comparison periods will be restated to conform with the new standard.
Further, changes in IFRS 18 will affect the presentation of our Consolidated Statements of Cash Flows, as defined by IAS 7. We do not expect these required changes to have a material impact on our Net cash flows from operating activities.
F-13
Table of Contents
Section A — Customers
This section discusses disclosures related to contracts with our customers. These include but are not limited to explanations of how we recognize revenue, revenue disaggregation, and information about our trade receivables and customer-related obligations.
(A.1) Revenue
y Accounting for Revenue from Contracts with Customers
Classes of Revenue
We derive our revenue from fees charged to our customers for the use of our cloud offerings, for licenses to our on-premise software products, and for standardized and premium support services, consulting, customer-specific software developments, training, and other services.
Cloud and software revenue, as presented in our Consolidated Income Statements, is the sum of our cloud revenue, our software license revenue, and our software support revenue.
Cloud revenue represents fees earned from providing customers with any of the following:
Software as a service (SaaS), that is, a right to use software functionality (including standard functionalities, AI use cases, and custom cloud applications and extensions) in a cloud-based infrastructure hosted by SAP or third parties subcontracted by SAP, where the customer does not have the right to terminate the hosting contract and take possession of the software to either run it on its own IT infrastructure or to engage a third-party provider unrelated to SAP to host and manage the software; SaaS also includes transaction and agent fees for transactions that customers execute on our cloud-based transaction platforms.
Platform as a service (PaaS), that is, access to a cloud-based platform to develop, deploy, integrate, and manage applications.
Infrastructure as a service (IaaS), that is, hosting and related application management services for software hosted by SAP or third parties engaged by SAP.
Premium cloud support, that is, support beyond the regular support embedded in the underlying cloud subscription services.
Software license revenue represents fees earned from the license of perpetual or time-based software to customers for use on the premises owned or fully controlled by the customer, in other words, where the customer has the right to take possession of the software for installation on the customer’s premises or on hardware of third-party hosting providers unrelated to SAP (on-premise software).
Software support revenue represents fees earned from providing customers with standardized support services that comprise unspecified future software updates, upgrades, and enhancements as well as technical product support services for on-premise software products.
Services revenue primarily represents fees earned from professional consulting services, premium support services, and training services.
Identification of a Contract
We frequently enter into multiple contracts with the same customer. For accounting purposes, we treat these contracts as a single contract if they are entered into at or near the same time and are economically interrelated. We do not combine contracts with closing days more than three months apart because we do not consider them being entered into near the same time. Judgment is required in evaluating whether various contracts are interrelated, which includes considerations as to whether they were negotiated as a package with a single commercial objective, whether the amount of consideration on one contract is dependent on the performance of the other contract, or if some or all goods in the contracts are a single performance obligation.
New arrangements with existing customers can be either a new contract or the modification of prior contracts with the customer. Our judgment in making this determination considers whether the goods and services under the new arrangement are highly interrelated with the goods and services sold under prior contracts, how the goods and services under the new arrangement are priced, and whether there is a connection between the new arrangement and the pre-existing contracts. In determining whether a change in transaction price represents a contract modification or a change in variable consideration, we examine whether the change in price results from changing the contract or from applying unchanged existing contract provisions.
F-14
Table of Contents
Identification of Performance Obligations
Our customer contracts often include various products and services. Typically, the products and services outlined in the Classes of Revenue section qualify as separate performance obligations and the portion of the contractual fee allocated to them is recognized separately. For distinct goods and services that are sold to customers in commercial bundles, SAP generally concludes that no significant integration or interrelation between the distinct goods and services exists, and therefore considers each individual good or service included in the commercial bundle to be distinct goods and services. Judgment is required, however, in determining whether a good or service is considered a separate performance obligation. For our professional services and implementation activities, judgment is required to evaluate whether such services significantly integrate, customize, or modify the on-premise software or cloud service to which they relate. In this context, we consider the nature of the services and their volume relative to the volume of the on-premise software or cloud service to which they relate. In general, the implementation services for our cloud services go beyond pure setup activities and qualify as separate performance obligations. Similarly, our on-premise implementation services and our custom development services typically qualify as separate performance obligations. Non-distinct goods and services are combined into one distinct bundle of goods and services (combined performance obligation).
When selling goods or services, we frequently grant customers options to acquire additional goods or services (for example, renewals of cloud or support arrangements, or additional volumes of purchased cloud solutions or software). We apply judgment in determining whether such options provide a material right to the customer that the customer would not receive without entering into that contract. In this judgment, we consider, for example, whether the options entitle the customer to a discount that exceeds the discount granted for the respective goods or services sold together with the option.
In scenarios where SAP:
- sells indirectly to end customers via partners
- sells third-party products to end customers
- provides services to end customers with the support of suppliers, or
- connects buyers and suppliers on cloud-based platforms,
SAP determines the respective nature of the performance obligation and whether SAP is providing the specified good or service itself or arranging for the good or service to be provided by the third party. SAP identifies whether it (or the partner) is acting as principal or agent in line with this performance obligation assessment. SAP exercises judgment in making this assessment, which is based on the question of whether the intermediary controls the specified good or service before it is transferred to the customer. In exercising this judgment, SAP relies in the majority of cases on bundling multiple goods or services into the specified good or service, on its legal responsibility toward the customer in providing the specified good or service, and on its pricing discretion for the same.
Determination of Transaction Price
We apply judgment in determining the amount to which we expect to be entitled in exchange for transferring promised goods or services to a customer. Generally, variable consideration is estimated based on the most likely amount and is included in the transaction price to the extent that the constraint does not apply. This includes estimates as to whether and to what extent subsequent concessions may be granted to customers and whether the customer is expected to pay the contractual fees. In this judgment, we consider our history with the respective customer or on a portfolio basis.
The recognition constraint is applied to on-premise software transactions that include usage-based or sales-based contingent fees. In contrast, our typical cloud services do not provide the customer with a software license because the customer does not have the right to terminate the hosting contract and take possession of the software. Consequently, variable cloud fees are considered in the transaction price based on estimates, rather than being accounted for as usage-based or sales-based license royalties. If SAP pays consideration to a customer in exchange for a distinct good or service-for example, when SAP acquires goods or services from a supplier, and such purchase is linked to a customer contract-the fair value of the purchase transaction must be estimated to conclude whether, and to what extent, the transaction price of the linked customer contract should be reduced or partially reduced.
Only very rarely do our contracts include significant financing components. We do not account for financing components if the period between when SAP transfers the promised goods or services to the customer and when the customer pays for those goods or services is one year or less.
F-15
Table of Contents
Allocation of Transaction Price
We have established a hierarchy to identify the standalone selling prices (SSPs) that we use to allocate the transaction price of a customer contract to the performance obligations in the contract.
- Where the SSPs for an offering are observable and reasonably consistent across customers (that is, not highly variable), our SSP estimates are derived from our respective pricing history. Typically, our standardized support offerings and our professional service offerings follow this approach.
- Where sales prices for an offering are not directly observable or highly variable across customers, we use estimation techniques.
The SSP for SAP’s cloud offerings considers overall pricing objectives, taking market conditions and other factors into account. We estimate the SSP using a specific pricing range that encompasses the majority of our transactions. In that context, we use judgment in determining the upper and lower end of the range. Such judgment considers price points achieved in the market as well as strategic pricing decisions.
For offerings for which we cannot justify a range and we observe highly variable pricing, and for which we lack substantial direct costs to estimate based on a cost-plus-margin approach, we allocate the transaction price by applying a residual approach. We use this technique in particular for our standard on-premise software offerings. To judge whether the historical pricing of our goods and services is highly variable, we have established thresholds of pricing variability.
As SAP’s go-to-market strategies evolve further, SAP continuously monitors its commercial models and pricing practices, which could result in changes to our SSPs in the future.
The SSPs of material right options depend on the probability of option exercise. In estimating these probabilities, we apply judgment considering historical exercise patterns.
Recognition of Revenue
Cloud revenue is recognized over time as the services are performed. For cloud business models where we grant rights to continuously access and use one or more cloud offerings for a certain term, revenue is recognized based on time elapsed and thus ratably over this term. For cloud business models provisioned on a consumption basis where a customer commits to a fixed value of spend on cloud services throughout the contract term, but with the discretion to call off cloud services during the contract term, we recognize revenue based on consumption as it best reflects our measure towards satisfaction of that performance obligation. In limited scenarios where the transaction price is entirely variable and determined by the customer’s consumption, we recognize revenue based on usage in the period in which it was earned.
Software license revenue is recognized at a point in time or over time depending on whether we deliver standard software, customer-specific software, or software subscription contracts that combine the delivery of software and the obligation to deliver, in the future, unspecified software products:
| - | Licenses for our standard on-premise software products are typically delivered by providing the customer with access to download the software. We recognize revenue for these on-premise licenses at the point in time when we grant the license rights to the customer and the customer has access to and thus control over the software. In judging whether our on-premise software offerings grant customers a right to use, rather than a right to access, our intellectual property, we have considered the usefulness of our software without subsequent updates to it. |
| - | Typically, our customer-specific on-premise software development agreements: |
◾ Represent software developed for specific needs of individual customers and therefore do not have any alternative use for us.
◾ Provide us with an enforceable right to payment for performance completed to date.
For such development agreements, we recognize revenue over time as the software development progresses. Judgment is required in identifying an appropriate method to measure the progress toward complete satisfaction of such performance obligations. We typically measure progress of our development agreements based on the direct costs incurred to date in developing the software as a percentage of the total reasonably estimated direct costs to fully complete the development work (input-based percentage-of-completion method). This method of measuring progress faithfully depicts the transfer of the development services to the customer, as substantially all of these costs are cost of the staff or third parties performing the development work. In estimating the total cost to fully complete the development work, we consider our history with similar projects.
| - | For agreements that combine the delivery of software and the obligation to deliver, in the future, unspecific software products, we recognize revenue at a point in time for licenses that are made immediately accessible to the customer. We recognize revenue ratably over the term of the software subscription contract for the unspecified software products, as our performance obligation is to stand ready to deliver such products on a when-and-if-available basis. |
Software support revenue is typically recognized based on time elapsed and thus ratably over the term of the support arrangement. Under our standardized support services, our performance obligation is to stand ready to provide technical product support and unspecified updates, upgrades, and enhancements on a when-and-if-available basis. Our customers simultaneously receive and consume the benefits of these support services as we perform.
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Service revenue is typically recognized over time. Where we stand ready to provide the service (such as access to learning content), we recognize revenue based on time elapsed and thus ratably over the service period. Non-stand-ready services (such as separately identifiable consulting services and premium support services) are recognized over time as the services are utilized, typically following the percentage-of-completion method. We apply judgment in determining whether a service qualifies as a stand-ready service or as a non-stand-ready service.
Revenue for combined performance obligations is recognized over the longest period of all promises in the combined performance obligation.
For performance obligations satisfied over time, we need to measure progress using the method that best reflects SAP’s performance. When using cost incurred as a measure of progress for recognizing revenue over time, we apply judgment in estimating the total cost to satisfy the performance obligation.
All of the judgments and estimates mentioned above can significantly impact the timing of revenue to be recognized.
Contract Balances
We recognize trade receivables for performance obligations satisfied over time gradually as the performance obligation is satisfied and in full once the invoice is due. Judgment is required in determining whether a right to consideration is unconditional and thus qualifies as a receivable.
Contract liabilities primarily reflect invoices due or payments received in advance of revenue recognition.
Typically, we invoice fees for on-premise standard software on contract closure and software delivery. Periodic fixed fees for cloud subscription services, software support services, and other multi-period agreements are typically invoiced yearly or quarterly in advance. Such fee prepayments account for the majority of our contract liability balance. Fees based on actual transaction volumes for cloud subscriptions and fees charged for non-periodical services are invoiced as the services are delivered. While payment terms and conditions vary by contract type and region, our terms typically require payment within
Geographic Information
The amounts for revenue by region in the following tables are based on the location of customers. The regions in the following table are EMEA (Europe, Middle East, and Africa), Americas (North America and Latin America), and APJ (Asia Pacific Japan).
Total Revenue by Region
€ millions | | 2025 | | 2024 | | 2023 |
Germany |
| |
| |
| |
Rest of EMEA |
| |
| |
| |
EMEA |
| |
| |
| |
United States |
| |
| |
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Rest of Americas |
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Americas |
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| |
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Japan |
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Rest of APJ |
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APJ |
| |
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SAP Group |
| |
| |
| |
Major Revenue Classes by Region
Cloud Revenue | Cloud and Software Revenue | |||||||||||
€ millions | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 |
EMEA | | | | | | | ||||||
Americas | | | | | | | ||||||
APJ | | | | | | | ||||||
SAP Group | | | | | | | ||||||
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Remaining Performance Obligations
Amounts of a customer contract’s transaction price that are allocated to the remaining performance obligations represent contracted revenue that has not yet been recognized. They include amounts recognized as contract liabilities and amounts that are contracted but not yet due.
Contractual periods that are subject to a customer termination for convenience right without a significant early-termination fee, or that are subject to a termination right under applicable law, are excluded from our remaining performance obligations. This is because we determine that enforceable rights and obligations do not exist for the periods subject to termination.
The transaction price allocated to performance obligations that were unsatisfied or partially unsatisfied as at December 31, 2025, was €
The transaction price allocated to remaining performance obligations varies between reporting periods, primarily due to the recognition of revenue for performance obligations outstanding at the end of the reporting period and the addition of new contracts within SAP’s cloud, maintenance, and services business. Other contributing factors include contract modifications, upsells, renewals, currency exchange rate fluctuations, and pricing adjustments.
The revenue recognized in fiscal year 2025 for contract renewals, new contracts, and contract modifications is presented on a gross basis in the following reconciliation of outstanding performance obligations. This means that it is included as a positive entry under “Add renewals, new contracts and modifications” and as a negative entry under “Less revenue recognized in 2025.”
Reconciliation of Remaining Performance Obligations
€ billions | | 2025 |
/ 12/31/2024 |
| |
Add renewals, new contracts, and modifications: | ||
- Cloud |
| |
- Maintenance |
| |
- Services |
| |
- Others1 | - | |
Less revenue recognized in 2025: | ||
- Cloud |
| - |
- Maintenance |
| - |
- Services |
| - |
Acquisitions and divestments2 |
| |
/ 12/31/2025 |
| |
1 Others mainly comprises currency fluctuations for our services and maintenance contracts and changes to the remaining performance obligations for our software contracts.
2 The 2025 acquisitions and divestments figure refers to the acquisition of SmartRecruiters.
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From December 31, 2023 to December 31, 2024, the remaining performance obligations increased from €
Performance Obligations Satisfied in Previous Years
Revenue recognized in the reporting period for performance obligations satisfied in earlier periods was €
Contract Balances
The following table presents the activities impacting contract liabilities balances during the year ended December 31, 2025:
Contract Liabilities
€ billions | | 2025 |
/ 1/1/2025 |
| |
Increases resulting from billing and invoices becoming due |
| |
Decreases resulting from satisfaction of performance obligations |
| - |
Other1 |
| - |
/ 12/31/2025 |
| |
1 Other includes, for example, the impact of foreign currency translation and business combinations.
The amount of revenue recognized in the reporting period that was included in the contract liability balance at the beginning of the reporting period was €
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(A.2) Trade and Other Receivables
y Accounting for Trade and Other Receivables
Depending on the business model, we measure trade receivables and contract assets from contracts with customers either at amortized cost, or at fair value through other comprehensive income (OCI) less expected credit losses. We account for expected credit losses by recording an allowance on a portfolio basis. We apply the simplified impairment approach. On initial measurement of the receivables, we consider all credit losses that are expected to occur during the lifetime of the receivables. We use a provision matrix to estimate these losses.
Additionally, we recognize allowances for individual receivables if there is objective evidence of credit impairment.
Account balances are written off either partially or in full if we judge that the likelihood of recovery is remote.
For information about how the default risk for trade receivables is analyzed and managed, how the loss rates for the provision matrix are determined, how credit impairment is determined and what our criteria for write-offs are, see the section on credit risk in Note (F.1).
In our Consolidated Income Statements, net gains/losses from expected credit loss allowances are included in Other operating income/expense, net. Gains/losses from foreign currency exchange rate fluctuations are included in Other non-operating income/expense, net.
Determining our expected credit loss allowance involves significant judgment. In this judgment, we primarily consider our historical experience with credit losses in the respective provision matrix risk class and current data on overdue receivables. We expect that our historical default rates represent a reasonable approximation for future expected customer defaults. Besides historical data, our judgment used in developing the provision matrix considers reasonable and supportable forward-looking information (for example, changes in country risk ratings, and fluctuations in credit default swaps of the countries in which our customers are located).
The assessment of whether a receivable is collectible involves the use of judgment and requires us to make assumptions about customer defaults that could change significantly.
By applying this judgment, we record an allowance for a specific customer when it is probable that a credit loss has occurred and the amount of the loss is reasonably estimable. Basing the expected credit loss allowance for the remaining receivables primarily on our historical loss experience likewise requires judgment, as history may not be indicative of future development. Also, including reasonable and supportable forward-looking information in the loss rates of the expected credit loss allowance requires judgment, as they may not provide a reliable prediction for future development.
Trade and Other Receivables
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Trade receivables, net |
| | |
| |
| |
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| | |
Other receivables |
| |
| |
| |
| |
| |
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/ Total |
| |
| |
| |
| |
| |
| |
Contract assets are included in Other receivables in our Statement of Financial Position.Contract assets as at December 31, 2025, were €
For more information about financial risk, how we manage credit risk, and details of our trade receivables and contract assets allowances, see Note (F.1).
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(A.3) Capitalized Cost from Contracts with Customers
y Costs of Obtaining Customer Contracts
Capitalized costs from customer contracts are classified as Other non-financial assets in our Statement of Financial Position.
The capitalized assets for the incremental costs of obtaining a customer contract consist of sales commissions earned by our sales force and partners as well as amounts paid to employees with non-sales roles when the payments meet the definition of being an incremental cost to obtain a contract with a customer. Judgment is required in determining the amounts to be capitalized, particularly where the commissions are based on cumulative targets and where commissions relate to multiple performance obligations in one customer contract. We capitalize such cumulative target commissions for all customer contracts that count towards the cumulative target but only if nothing other than obtaining customer contracts can contribute to achieving the cumulative target. Commissions for contracts with multiple performance obligations or for probable renewals thereof are allocated to these performance obligations and probable renewals relative to the respective standalone selling price.
Our sales commission payments for customer contract renewals are typically not commensurate with the commissions paid for new contracts. Thus, the commissions paid for renewable new contracts also relate to expected renewals of these contracts. Consequently, we amortize sales commissions paid for new customer contracts on a straight-line basis over the expected contract life including probable contract renewals. Judgment is required in estimating these contract lives. In exercising this judgment, we consider our expectation about future contract renewals which we evaluate periodically to confirm that the resulting amortization period properly reflects the expected contract life or if there are potential indicators of impairment. The amortization periods range from
Amortization of the capitalized costs of obtaining customer contracts is classified mainly as sales and marketing expense. We expense the incremental costs of obtaining a customer contract as incurred if we expect an amortization period of
y Costs to Fulfill Customer Contracts
Capitalized costs incurred to fulfill customer contracts mainly consist of directly related costs for set-up and implementation of cloud products and custom cloud development contracts as far as these costs are not in scope of other accounting standards than IFRS 15. These costs are amortized after completion of the setup and implementation or the development, respectively, on a straight-line basis over the expected life of the cloud subscription contract including expected renewals. For the life of the contract, we consider our expectation about future contract renewals which we evaluate periodically to confirm that the resulting amortization period properly reflects the expected contract life. The amortization periods range from
Amortization of capitalized costs to fulfill customer contracts is included in the cost of cloud.
Capitalized Cost from Contracts with Customers
2025 |
| 2024 | ||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Capitalized cost of obtaining customer contracts |
| | | | |
| |
| | |||
Capitalized cost to fulfill customer contracts |
| | | | |
| |
| | |||
Capitalized contract cost | | | | | | | ||||||
/ Other non-financial assets |
| | | | | |
| | ||||
Capitalized contract cost as % of / Other non-financial assets |
| | | | |
| |
| | |||
Amortization Expense
€ millions | | 2025 | | 2024 |
Capitalized cost of obtaining customer contracts |
| |
| |
Capitalized cost to fulfill customer contracts |
| |
| |
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(A.4) Customer-Related Provisions
y Expected Contract Losses
Customer-related provisions mainly include expected contract losses. We adjust these provisions as further information becomes available and as circumstances change. Non-current provisions are measured at the present value of their expected settlement amounts as at the reporting date.
The unit of account for the identification of potential onerous customer contracts is based on the contract definition of IFRS 15 including the contract combination guidance. The economic benefits considered in the assessment comprise the future benefits we are directly entitled to under the contract as well as the anticipated future benefits that are the economic consequence of the contract if these benefits can be reliably determined.
y Customer-Related Litigation and Claims
Customer-related provisions also include obligations resulting from customer-related litigation and claims. We are currently confronted with various claims and legal proceedings, including claims that relate to customers demanding indemnification for proceedings initiated against them based on their use of SAP software, and occasionally claims that relate to customers being dissatisfied with the products and services that we have delivered to them. The obligations arising from customer-related litigation and claims comprise cases in which we indemnify our customers against liabilities arising from a claim that our products infringe a third party’s patent, copyright, trade secret, or other proprietary rights.
Due to uncertainties relating to these matters, provisions are based on the best information available. Significant judgment is required in the determination of whether and when a provision is to be recorded and what the appropriate amount for such provision should be. Notably, judgment is required in the following areas:
- Determining whether an obligation exists
- Determining the probability of outflow of economic benefits
- Determining whether the amount of an obligation is reliably estimable
- Estimating the amount of the expenditure required to settle the present obligation
At the end of each reporting period, we reassess the potential obligations related to our pending claims and litigation and adjust our respective provisions to reflect the current best estimate. In addition, we monitor and evaluate new information that we receive after the end of the respective reporting period, but before the Consolidated Financial Statements are authorized for issue, to determine whether this provides additional information regarding conditions that existed at the end of the reporting period. Changes to the estimates and assumptions underlying our accounting for legal contingencies, and outcomes that differ from these estimates and assumptions, could require material adjustments to the carrying amounts of the respective provisions recorded and additional provisions. The expected timing or amounts of any outflows of economic benefits resulting from these lawsuits and claims are uncertain and not estimable, as they generally depend on the duration of the legal proceedings and settlement negotiations required to resolve the litigation and claims and the unpredictability of the outcomes of legal disputes in several jurisdictions.
Contingent liabilities exist in respect of customer-related litigation and claims for which no provision has been recognized. It is not practicable to estimate the financial impact of these contingent liabilities due to the uncertainties around these lawsuits and claims as outlined above.
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Section B — Employees
This section provides financial insights into our employee benefit arrangements. It should be read in conjunction with the compensation disclosures for key management personnel in Note (G.5).
(B.1) Number of Employees
The following table provides an overview of number of employees, broken down by function and by the regions EMEA (Europe, Middle East, and Africa), Americas (North America and Latin America), and APJ (Asia Pacific Japan).
Number of Employees by Region and Function
12/31/2025 | 12/31/2024 | 12/31/2023 | ||||||||||||||||||||||
Full-time equivalents | | EMEA | | Americas | | APJ | | Total | | EMEA | | Americas | | APJ | | Total | | EMEA | | Americas | | APJ | | Total |
Cloud and software |
| | | | |
| | | | |
| |
| |
| |
| | ||||||
Services |
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| | | | |
| |
| |
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| | ||||||
Research and development |
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| | | | |
| |
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| |
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Sales and marketing |
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| | | | |
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General and administration |
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| | | | |
| |
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Infrastructure |
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| | ||||||
SAP Group (December 31) |
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| |
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thereof acquisitions |
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| | | | |
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SAP Group (months' end average) |
| | | | |
| | | | |
| |
| |
| |
| | ||||||
Most of the employees participating in the Company’s voluntary leave programs left SAP in 2024 and throughout the first half of 2025. For more information about the transformation program and its impact on employee headcount, see Note (B.6).
(B.2) Employee Benefits Expenses
€ millions | | 2025 | | 2024 | | 2023 |
Salaries |
| |
| |
| |
Social security expenses |
| |
| |
| |
Share-based payment expenses |
| |
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Pension expenses |
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| |
| |
Employee-related restructuring expenses |
| |
| |
| |
Termination benefits outside of restructuring plans |
| |
| |
| |
Employee benefits expenses |
| |
| |
| |
Termination benefits outside of restructuring plans increased in 2025 compared to 2024, mainly due to €
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(B.3) Share-Based Payments
y Accounting for Share-Based Payments
Classification in the Consolidated Income Statements
Share-based payments cover equity-settled and cash-settled awards issued to our employees. The respective expenses are recognized as employee benefits and classified in our Consolidated Income Statements according to the activities that the receiving employees perform. Share-based payment expenses are offset by the effective portion from the hedging of cash-settled share-based payments. Accelerated share - based payment expenses triggered by SAP’s 2024 restructuring program are classified as restructuring expenses in our Consolidated Income Statements and included in the restructuring provisions in our Statement of Financial Position.
Valuation, Judgment, and Sources of Estimation Uncertainty
We use certain assumptions in estimating the fair values for our share-based payments, including expected share price volatility and expected dividend yields. In addition, the final number of Performance Share Units (PSUs) vesting also depends on the achievement of performance indicators. Furthermore, the payout for cash-settled share units depends on our share price on the respective vesting dates. Changes to these assumptions and outcomes that differ from these assumptions could require material adjustments to the carrying amount of the liabilities we have recognized for these share-based payments. The fair value of the share units granted under the SAP Long-Term Incentive Program 2024 and 2020 (LTI 2024 and LTI 2020) is dependent on our performance against the total shareholder return (TSR) for NASDAQ-100 companies, the volatility, and the expected correlation between the TSR of the NASDAQ-100 companies and our TSR.
Regarding future payout under our cash-settled plans, the SAP share price is the most relevant factor. With respect to our LTI 2024 and LTI 2020, we believe that future payout will be significantly impacted not only by our share price but also by the relative TSR performance against the NASDAQ-100 companies. Future payouts under our LTI 2024 and LTI 2020 will also be dependent on meeting non-market-based performance conditions based on SAP’s long-term strategy. The latter, however, is not incorporated into our fair value calculation but leads to adjustments of the quantity of awards granted. Changes in these factors could significantly affect the estimated fair values as calculated by the valuation model, and the future payout.
Under the OWN SAP share purchase plan, we grant our employees discounts on share purchases. As those discounts are not dependent on future services to be provided by our employees, the discount is recognized as an expense when the discounts are granted.
Presentation in the Consolidated Statements of Cash Flows
We present the payments of our cash-settled share-based payment plans and our equity-settled share-based payment plans that are fulfilled by share purchases at the market (see Own SAP Plan in section a) of this Note (B.3)) separately in our Consolidated Statements of Cash Flows under Cash flows from operating activities. As a result, the changes in Other assets and in Other liabilities presented in the reconciliation of operating cash flow do not consider share-based payment-related assets or liabilities. Cash flows from share - based payments are offset by payments from the hedging of cash - settled share - based payments. Payments of cash-settled share-based payments triggered by SAP’s 2024 restructuring program are included in the restructuring payments.
The operating expense line items in our income statement include the following share-based payment expenses:
Share-Based Payment Expenses by Functional Area
€ millions | | 2025 | | 2024 | | 2023 |
Cost of cloud | | | | |||
Cost of software licenses and support |
| |
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Cost of services |
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Research and development |
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Sales and marketing |
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General and administration |
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Share-based payment expenses |
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thereof equity-settled share-based payments |
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thereof cash-settled share-based payments |
| |
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| |
Additionally, in 2024 SAP recognized €
For more information about SAP’s newly implemented hedge program in 2025 related to its cash-settled share-based compensation payments, see Note (F.1).
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Our major share-based payment plans are described below.
Equity-Settled Move SAP Plan (Move)
To retain and engage executives and certain employees, we grant share units under Move that we intend to predominantly settle in shares. For more information about the terms and conditions of the cash-settled Move plan, see section b) Cash-Settled Share-Based Payments in this Note (B.3).
Different vesting schedules apply to specific share units. Granted share units will vest in different tranches mainly as follows:
| - | Restricted Stock Units (RSUs) with service condition only |
| - | Over a |
| - | Performance Share Units (PSUs) with service condition and upon achieving certain key performance indicators (KPIs) |
| - | Over a |
The number of PSUs that will vest under the different tranches is mainly contingent upon achievement of
We intend to settle the share units classified as equity-settled by reissuing treasury shares upon vesting. For more information, see Note (E.2).
The valuation was based on the following parameters and assumptions:
Fair Value and Parameters Used at Grant Date in 2025
Move | ||
€, unless otherwise stated | | (2025 tranche) |
Weighted average fair value as at grant date | ||
Information how fair value was measured at grant date | ||
Valuation model used |
| Other1 |
Weighted average share price | ||
Weighted average expected dividend yield (in %) |
| |
Weighted average initial life at grant date (in years) |
|
1 For these awards, the fair value is calculated by subtracting expected future dividends until maturity of the respective award from the prevailing share price as at the measurement date.
Fair Value and Parameters Used at Grant Date in 2024
| Move | |
€, unless otherwise stated | (2024 tranche) | |
Weighted average fair value as at grant date |
| |
Information how fair value was measured at grant date |
| |
Valuation model used |
| Other1 |
Weighted average share price |
| |
Weighted average expected dividend yield (in %) |
| |
Weighted average initial life at grant date (in years) |
| |
1 For these awards, the fair value is calculated by subtracting expected future dividends until maturity of the respective award from the prevailing share price as at the measurement date.
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Changes in Outstanding Awards
| Move | |
Thousands, unless otherwise stated | | (2023-2025 tranches) |
12/31/2023 | | |
Granted2 |
| |
Adjustment based on KPI target achievement |
| |
Exercised |
| - |
Forfeited |
| - |
Change in settlement2 | - | |
12/31/2024 |
| |
Granted2 |
| |
Adjustment based on KPI target achievement |
| - |
Exercised |
| - |
Forfeited |
| - |
Change in settlement2 | - | |
12/31/2025 |
| |
2 We have changed the classification of some share units granted under the Move plan with the initial intention to settle in shares from equity-settled to cash-settled because a cash outflow became probable, in particular due to the restructuring program. Share units with switched classification are considered in the number of granted share units.
The weighted average share price for awards exercised in 2025 was €
Own SAP Plan (Own)
Under the share purchase plan Own, employees have the opportunity to purchase, on a monthly basis, SAP shares without any required holding period. The investment per each eligible employee is limited to a percentage of the respective employee’s monthly base salary. SAP matches the employee investment by
Numbers of Shares Purchased
Millions | | 2025 | | 2024 | | 2023 |
Own |
| |
| |
| |
As a result of Own, we have commitments to grant SAP shares to employees. We have fulfilled and intend to continue to meet these commitments through an agent who administers the equity-settled programs and purchases shares on the open market. The fair value at grant date is determined based on the average share price of €
Recognized Expense
€ millions | | 2025 | | 2024 | | 2023 |
Move (2023–2025 tranches) |
| |
| |
| |
Own |
| |
| |
| |
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Table of Contents
Cash-Settled Move SAP Plan (Move) Including Grow SAP Plan
We also grant share units in certain circumstances under Move representing a contingent right to receive a cash payment that is determined by the SAP share price and the number of share units that ultimately vest. For more information about the terms and conditions of the equity-settled Move plan, see section a) Equity-Settled Share-Based Payments in this Note (B.3).
From 2020 to 2023, we granted share units under the Grow SAP Plan that we intend to settle in cash. This fixed term plan has broadly the same terms and conditions as Move and recognizes all employees’ commitment to SAP’s success, and deepens their participation in our future company performance.
Different vesting schedules apply to specific share units. Granted share units under the respective plans will vest in different tranches, mainly as follows:
–Restricted Stock Units (RSUs) with service condition only
| - | Over a |
| - | Over a |
–Performance Share Units (PSUs) with service condition and upon achieving certain key performance indicators (KPIs)
| - | Over a |
The number of PSUs that will vest under the different tranches is mainly contingent upon achievement of
The share units classified as cash-settled are paid out in cash upon vesting.
SAP Long-Term Incentive Program 2020 and SAP Long-Term Incentive Program 2024 (LTI 2020 and LTI 2024)
The LTI 2024 and LTI 2020 are long-term, multiyear performance-based elements of our Executive Board compensation that are granted in annual tranches. The LTI 2024 and LTI 2020 reflect SAP’s long-term strategy and thus set uniform incentives to achieve key targets from the long-term strategic plans. The LTI 2024 and LTI 2020 also serve to reward the Executive Board members for long-term SAP share price performance as compared to the market, thus ensuring that shareholders’ interests are also honored. In addition, the LTI 2024 includes ESG targets to reward the Executive Board members for their achievements in advancing SAP’s long-term sustainability goals, while the LTI 2020 includes a component to ensure long-term retention of our Executive Board members.
The LTI 2024 and LTI 2020 are virtual share programs under which annual tranches with a term of approximately
The number of Financial PSUs initially awarded is multiplied by a performance factor. The performance factor consists of individual performance indicators relating to non-IFRS KPIs at constant currencies, derived from SAP’s long-term strategy, which for the LTI 2024 are operating profit and total revenue (which replaced cloud revenue and software licenses and support & services revenue for the 2025 tranche). For the LTI 2020, the non-IFRS KPIs are cloud revenue, total revenue, and operating profit. The performance period throughout which the target achievement for these
The number of Market PSUs initially awarded is multiplied by a performance factor. The performance factor depends on the amount of the TSR on SAP share, measured for an entire performance period of approximately
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The number of ESG PSUs initially awarded is multiplied by a performance factor. The performance factor consists of
The performance of the share units is linked to the performance of the SAP share price, including dividend payments. Accordingly, an amount is paid out for each share unit that equals the then-current SAP share price plus the dividends disbursed in respect of an SAP share in the period from the beginning of the year in which the share units were awarded until the end of the third year following the year in which the share units were awarded. The average SAP share price for the LTI 2024 on the
If an Executive Board member’s service contract is terminated before the end of the third year following the year in which the share units were granted, the share units are forfeited in whole or in part, depending on the circumstances in which the member resigns from office or the service contract is terminated.
The valuation was based on the following parameters and assumptions:
Fair Value and Parameters Used at Year End 2025
| LTI 2024 | | LTI 2020 | | Move | |
(2024-2025 | (2022–2023 | (2022–2025 | ||||
€, unless otherwise stated | | tranches) | | tranches) | | tranches) |
Weighted average fair value as at 12/31/2025 | | |
| | ||
Information how fair value was measured at measurement date |
|
| | |||
Valuation model used |
| Monte Carlo | Monte Carlo | Other3 | ||
Share price | | | | |||
Expected volatility (in %) |
| NA | ||||
Expected dividend yield (in %) |
| NA | NA | | ||
Weighted average remaining life of awards outstanding as at 12/31/2025 (in years) |
|
3 For these awards, the fair value is calculated by subtracting expected future dividends, if any, until maturity of the respective award from the prevailing share price as at the measurement date.
Fair Value and Parameters Used at Year End 2024
| LTI 2024 | | LTI 2020 | | Move | |
(2024 | (2021-2023 | (2021-2024 | ||||
€, unless otherwise stated | | tranche) | | tranches) | | tranches) |
Weighted average fair value as at 12/31/2024 | | |
| | ||
Information how fair value was measured at measurement date |
|
| | |||
Valuation model used |
| Monte Carlo | Monte Carlo | Other3 | ||
Share price | | | | |||
Expected volatility (in %) |
| | NA | |||
Expected dividend yield (in %) |
| NA | NA | | ||
Weighted average remaining life of awards outstanding as at 12/31/2024 (in years) |
|
3 For these awards, the fair value is calculated by subtracting expected future dividends, if any, until maturity of the respective award from the prevailing share price as at the measurement date.
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For the LTI 2020 valuation, the expected volatility of the NASDAQ-100 companies of
The SAP dividend yield is based on expected future dividends.
Changes in Outstanding Awards
| LTI 2024 | | LTI 2020 | | Move | |
(2024-2025 | (2021–2023 | (2021–2025 | ||||
Thousands, unless otherwise stated | tranches) | tranches) | tranches) | |||
12/31/2023 |
| NA |
| |
| |
Granted4 |
| |
| |
| |
Adjustment based upon KPI target achievement |
| |
| |
| |
Exercised |
| |
| - |
| - |
Forfeited | - | - | - | |||
Change in settlement4 |
| NA |
| NA |
| |
12/31/2024 |
| |
| |
| |
Granted4 |
| |
| |
| |
Adjustment based upon KPI target achievement |
| |
| |
| |
Exercised |
| |
| - |
| - |
Forfeited | | | - | |||
Change in settlement4 |
| NA |
| NA |
| |
12/31/2025 |
| |
| |
| |
Total carrying amount (in € millions) of liabilities as at |
|
|
| |||
12/31/2024 |
| |
| |
| |
12/31/2025 |
| |
| |
| |
Total intrinsic value of vested awards (in € millions) as at |
|
|
| |||
12/31/2024 |
| |
| |
| |
12/31/2025 |
| | | | ||
Weighted average share price (in €) for awards exercised in |
|
|
| |||
2024 |
| NA |
| |
| |
2025 |
| NA |
| |
| |
Total expense (in € millions) recognized in |
|
|
| |||
2023 |
| NA |
| |
| |
2024 |
| |
| |
| |
2025 |
| |
| |
| |
4 We have changed the classification of some share units granted under the Move plan with the initial intention to settle in shares from equity-settled to cash-settled because a cash outflow became probable, in particular due to the restructuring program.
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Share-Based Payment Balances
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Share-based payment liabilities |
| | | |
| | | | ||||
/ Other non-financial liabilities | | | | | | | ||||||
Share-based payment liabilities as % of / Other non-financial liabilities | | | | | | | ||||||
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(B.4) Pension Plans and Similar Obligations
y Defined Contribution Plans
Amounts for domestic and foreign defined contribution plans are based on a percentage of the employees’ salaries or on the amount of contributions made by employees. In Germany and some other countries, we make contributions to public pension schemes that are operated by national or local government or similar institutions. Expenses for such local state pension plans are recognized as short-term employee benefits, that is, social security expenses.
y Defined Benefit Pension Plans
The discount rates used in measuring our post-employment benefit assets and liabilities are derived from rates available on high-quality corporate bonds and government bonds for which the timing and amounts of payments match the timing and the amounts of our projected pension payments. Net interest expense and other expenses related to defined benefit plans are recognized as employee benefits expenses and classified in our Consolidated Income Statements according to the activities that the employees owning the awards perform. Since our domestic defined benefit pension plans primarily consist of an employee-financed post-retirement plan that is fully financed with qualifying insurance policies, current service cost may become a credit as a result of adjusting the defined benefit liability’s carrying amount to the fair value of the qualifying plan assets. Such adjustments are recorded in service cost. Total expenses on defined benefit pension plans comprise related current and past service costs as well as interest income and expense.
Total Expense of Pension Plans
€ millions | | 2025 | | 2024 | | 2023 |
Defined contribution plans |
| |
| |
| |
Defined benefit pension plans |
| |
| |
| |
Pension expenses |
| |
| |
| |
Defined Benefit Plans
Present Value of the Defined Benefit Obligations (DBO) and the Fair Value of the Plan Assets
Other Foreign Post- | ||||||||||||||||
Domestic Plans | Foreign Plans | Employment Plans | Total | |||||||||||||
€ millions | | 2025 | | 2024 | | 2025 | | 2024 | | 2025 | | 2024 | | 2025 | | 2024 |
Present value of the DBO |
| |
| |
| |
| |
| |
| |
| |
| |
Fair value of the plan assets |
| |
| |
| |
| |
| |
| |
| |
| |
Net defined benefit liability (asset)1 |
| |
| |
| |
| |
| |
| |
| |
| |
thereof: Net defined benefit asset | | | - | - | | - | - | - | ||||||||
Net defined benefit liability | | | | | | | | | ||||||||
Net defined benefit asset as % of / Non-current other financial assets |
| |
| |
| |
| |
| | |
| |
| | |
Net defined benefit liability as % of / Non-current provisions | | | | | | | | | ||||||||
¹ after the effects of the asset ceiling
Of the present value of the DBO of our domestic plans, €
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The following significant weighted average assumptions were used for the actuarial valuation of our domestic and foreign pension liabilities as well as other post-employment benefit obligations as at the respective measurement date:
Significant Actuarial Assumptions
Domestic Plans | Foreign Plans | Other Foreign Post-Employment Plans | ||||||||||||||||
Percent | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 |
Discount rate |
| |
| |
| |
| |
| |
| |
| |
| |
| |
The sensitivity analysis table below shows how the present value of all defined benefit obligations would have been influenced by reasonably possible changes to significant actuarial assumptions. The sensitivity analysis considers change in discount rate assumptions, holding all other actuarial assumptions constant.
Sensitivity Analysis
Domestic Plans | Foreign Plans | Other Foreign Post-Employment Plans | Total | |||||||||||||||||||||
€ millions | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 |
Present value of all defined benefit obligations if: |
| |
| |
|
| |
| |
|
| |
| |
|
| |
| | |||||
Discount rate was |
| | | |
| |
| |
| |
| |
| |
| |
| |
| |
| | ||
Discount rate was |
| | | |
| |
| |
| |
| |
| |
| |
| |
| |
| | ||
Investments in Plan Assets
Our investment strategy on domestic benefit plans is to invest all contributions in stable insurance policies.
Our investment strategies for foreign benefit plans vary according to the conditions in the country in which the respective benefit plans are situated. We have adopted a long-term investment horizon for all major foreign benefit plans. Although our policy is to invest in a risk-diversified portfolio consisting of a mix of assets, both the defined benefit obligation and plan assets can fluctuate over time, which exposes the Group to actuarial and market (investment) risks. Depending on the statutory requirements in each country, it might be necessary to reduce any underfunding by addition of liquid assets.
Plan Asset Allocation
2025 | 2024 | |||||||
| Quoted in an | | Not Quoted in an | | Quoted in an | | Not Quoted in an | |
€ millions | Active Market | Active Market | Active Market | Active Market | ||||
Total plan assets |
| |
| |
| |
| |
thereof: Asset category |
|
|
|
| ||||
Equity investments |
| |
| |
| |
| |
Corporate bonds |
| |
| |
| |
| |
Insurance policies |
| |
| |
| |
| |
Our expected contribution in 2026 to our domestic and foreign defined benefit pension plans is immaterial. The weighted duration of our defined benefit plans amounted to
Total future benefit payments from our defined benefit plans as at December 31, 2025, are expected to be €
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(B.5) Other Employee-Related Obligations
y Accounting Policy
As far as the obligation for long-term employee benefits is secured by pledged reinsurance coverage, it is offset with the relating plan asset.
Other Employee-Related Liabilities
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Other employee-related liabilities |
|
|
|
| |
| |
| | |||
/ Other non-financial liabilities | | | | |||||||||
Other employee-related liabilities as % of / Other non-financial liabilities |
|
|
|
| |
| |
| | |||
Other employee-related liabilities mainly relate to obligations from bonuses and sales commissions, outstanding vacation, time credits accumulated in the working time account, employee-related social security expenses and deferred compensation liabilities. The decrease is mainly attributable to lower obligations for bonuses and for share-based payments.
(B.6) Restructuring
y Recognition of Restructuring Provisions
We only recognize provisions for restructuring if and when the following occurs:
- SAP has designed a program that materially changes the scope of one of our businesses or the manner in which the business is conducted, and
- A detailed and documented restructuring plan has been approved by our Executive Board, a member thereof, or a direct report of an Executive Board member, and
- The program established is planned to start shortly after the program plan is approved and is expected to be completed in a timeframe that makes significant changes to the plan unlikely, and
- The program has been announced to the parties affected or has commenced.
We consider whether a change in business is material based on the business affected rather than for SAP as a whole. In judging whether a unit qualifies as a business for restructuring purposes, we consider if the unit has its own management team, has access to all inputs and processes necessary to provide outputs, and generates or could generate revenues. The materiality of a change to a business is assessed based on both the size and the nature of the change and therefore does not necessarily involve a material quantitative impact on our financial statements.
Restructuring Expenses
€ millions | | 2025 | | 2024 | | 2023 |
Employee-related restructuring expenses |
| - |
| - | - | |
Onerous contract-related restructuring expenses and restructuring-related impairment losses |
| |
| - |
| |
Restructuring expenses |
| - |
| - |
| - |
The increase in restructuring costs presented in 2024 mainly relate to SAP’s Company-wide restructuring program that was announced in January 2024. SAP increased its focus on key strategic growth areas, particularly business AI. The 2024 restructuring program was set up to ensure that SAP’s skillset and resources continue to meet future business needs, and affected around
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Most of the expenses related to the restructuring program were recognized in 2024. Overall expenses associated with the program were approximately €
Termination benefits related to SAP’s 2025 workforce optimization program were not presented as restructuring expenses (for more information, see Note (B.2)).
If not presented separately in our income statement, restructuring expenses would have been classified in the different expense items in our income statement as follows:
Restructuring Expenses by Functional Area
€ millions | | 2025 | | 2024 | | 2023 |
Cost of cloud | - | | ||||
Cost of software licenses and support |
|
| - |
| - | |
Cost of services |
|
| - |
| - | |
Research and development |
|
| - |
| - | |
Sales and marketing |
| - |
| - |
| - |
General and administration | - | - | - | |||
Restructuring expenses | - | - | - |
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Section C — Financial Results
This section provides insight into the financial results of SAP’s reportable segments and of SAP overall as far as not already covered by previous sections. This includes, but is not limited to, segment results, income taxes, and earnings per share.
(C.1) Results of Segments
General Information
In the first half of 2025, the Services Sales function was moved from the Board area Customer Success into the Board area Customer Success & Delivery, combining the sales and delivery function for services. SAP therefore revised its segment structure in the first quarter of 2025.
At year end 2025, SAP had
| - | The ATS segment represents SAP’s cohesive product portfolio, which is holistically steered and commercialized. The segment primarily generates revenue from cloud subscriptions and support offerings, and incurs costs for operating our cloud solutions and customer support. The revenue and cost for services arise from SAP’s training business, which is highly integrated with SAP’s product portfolio. |
| - | The Core Services segment supports SAP’s product portfolio by enabling customers to accelerate the adoption of innovations. Revenues are mainly generated from professional consulting services and premium support services. Cost is incurred primarily for the delivery of those services. The Core Services segment does not reflect the full services business. |
The segment information for comparative prior periods was restated to conform with the new segment composition.
y Segment Reporting Policies
Our management reporting system produces reports that present information about our business activities in a variety of ways – for example, by line of business, geography, and areas of responsibility of individual Board members. Based on these reports, the Executive Board, which is responsible for assessing the performance of our Company and for making resource allocation decisions as our Chief Operating Decision Maker (CODM), evaluates business activities.
The segment structure is derived from the organizational structure, with parts of the organization engaging in diverse activities that incur expenses across different cost classifications. For example, various teams within the organizational structure of the Core Services segment incur costs for activities that generate cloud and software support revenue. However, for the segment structure, they are allocated within the Core Services segment.
Our management reporting system produces a variety of reports that differ due to the currency exchange rates used in the accounting for foreign-currency transactions and operations, where both actual and constant currency numbers are reported to and used by our CODM. Reports based on actual currencies use the same currency rates that are used in our financial statements, whereas reports based on constant-currency use the average exchange rates from the previous year’s corresponding period. Therefore, the 2025 constant currency amounts are only comparable to 2024 actual currency amounts; similarly, the 2024 constant currency amounts are only comparable to 2023 actual currency amounts.
We use an operating profit indicator to measure the performance of our operating segments. The accounting policies applied in the measurement of operating segment expenses and profit differ as follows from the IFRS accounting principles used to determine the operating profit measure in our income statements:
The segment expense measures exclude the following:
| - | Acquisition-related charges such as amortization expense and impairment charges for intangibles acquired in business combinations, including goodwill impairment charges, and certain standalone acquisitions of intellectual property (including purchased in-process research and development) as well as settlements of pre-existing business relationships in connection with a business combination, and acquisition-related third-party expenses |
| - | Restructuring expenses |
| - | Regulatory compliance matter expenses |
| - | Expenses related to the litigation with Teradata |
SAP headquarters functions that are managed exclusively on corporate level, such as finance, accounting, legal and compliance, human resources, global strategy and business operations, and corporate marketing, are not included in the results of our reportable segments.
Information about our assets and liabilities by segment and cashflow by segment is not regularly provided to our CODM.
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Results of Segments
Applications, Technology & Support
2025 | 2024 | 2023 | ||||||||
€ millions | Actual | Constant | Actual | Constant | Actual | |||||
(non-IFRS) | | Currency | | Currency | | Currency | | Currency | | Currency |
Cloud | | | | | | |||||
Software licenses | | | | | | |||||
Software support | | | | | | |||||
Software licenses and support | | | | | | |||||
Cloud and software | | | | | | |||||
Services | | | | | | |||||
Total segment revenue | | | | | | |||||
Cost of cloud |
| - |
| - |
| - |
| - |
| - |
Cost of software licenses and support |
| - |
| - |
| - |
| - |
| - |
Cost of cloud and software |
| - |
| - |
| - |
| - |
| - |
Cost of services |
| - |
| - |
| - |
| - |
| - |
Total cost of revenue |
| - |
| - |
| - |
| - |
| - |
Segment gross profit |
| |
| |
| |
| |
| |
Other segment expenses |
| - |
| - |
| - |
| - |
| - |
Segment profit (loss) |
| |
| |
| |
| |
| |
The expenses for depreciation and amortization decreased
Core Services
2025 | 2024 | 2023 | ||||||||
€ millions | Actual | Constant | Actual | Constant | Actual | |||||
(non-IFRS) | | Currency | | Currency | | Currency | | Currency | | Currency |
Services | | | | | | |||||
Total segment revenue | | | | | | |||||
Cost of cloud | - | - | - | - | - | |||||
Cost of software licenses and support |
| - |
| - |
| - |
| - |
| - |
Cost of cloud and software |
| - |
| - |
| - |
| - |
| - |
Cost of services |
| - |
| - |
| - |
| - |
| - |
Total cost of revenue |
| - |
| - |
| - |
| - |
| - |
Segment gross profit |
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| |
Other segment expenses |
| - |
| - |
| - |
| - |
| - |
Segment profit (loss) |
| |
| |
| |
| |
| |
The expenses for depreciation and amortization decreased
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Table of Contents
Segment Revenue by Region
The amounts for revenue by region in the following tables are based on the location of customers.
Applications, Technology & Support
2025 | | 2024 | | 2023 | ||||||
Actual | Constant | Actual | Constant | Actual | ||||||
€ millions | | Currency | | Currency | | Currency | | Currency | | Currency |
Germany |
| |
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| |
Rest of EMEA |
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EMEA |
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United States |
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Rest of Americas |
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Americas |
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Japan |
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Rest of APJ |
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APJ |
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Segment revenue |
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Core Services
2025 | | 2024 | | 2023 | ||||||
Actual | Constant | Actual | Constant | Actual | ||||||
€ millions | | Currency | | Currency | | Currency | | Currency | | Currency |
Germany |
| |
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Rest of EMEA |
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EMEA |
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United States |
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Rest of Americas |
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Americas |
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Japan |
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Rest of APJ |
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APJ |
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Segment revenue |
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Table of Contents
(C.2) Reconciliation of Segment Measures to the Consolidated Income Statements
2025 | 2024 | 2023 | ||||||||
Actual | Constant | Actual | Constant | Actual | ||||||
€ millions | | Currency | | Currency | | Currency | | Currency | | Currency |
Total revenue for ATS segment | | | | | | |||||
Total revenue for Core Services segment | | | | | | |||||
Total segment revenue | | | | | | |||||
Adjustment for currency impact | | - | | - | | |||||
Total revenue | | | | | | |||||
Total profit for ATS segment | | | | | | |||||
Total profit for Core Services segment | | | | | | |||||
Total segment profit | | | | | | |||||
Adjustment for currency impact | | - | |
| - |
| | |||
Other expenses | - | - | - | - | - | |||||
Adjustment for | ||||||||||
Acquisition-related charges | - | - | - |
| - |
| - | |||
Restructuring | - | - | - |
| - |
| - | |||
Regulatory compliance matter expenses | | | | | - | |||||
Teradata litigation expenses | - | - | | | | |||||
Operating profit | | | | | | |||||
Other non-operating income/expense, net | | | - | - | - | |||||
Financial income, net | - | - | - | - | - | |||||
Adjustment for gains and losses from equity securities, net | | | | | - | |||||
Profit before tax | | | | | | |||||
(C.3) Other Non-Operating Income/Expense, Net
€ millions | | 2025 | | 2024 | | 2023 |
Foreign currency exchange gain/loss, net |
| |
| - |
| |
Miscellaneous income/expense, net |
| - |
| - |
| - |
Other non-operating income/expense, net |
| |
| - |
| - |
The movement in Other non-operating income/expense is mainly driven by changes in foreign exchange rates.
For more information about net gains or losses on financial instruments by IFRS 9 measurement category, see Note (F.2).
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Table of Contents
(C.4) Financial Income, Net
€ millions | | 2025 | | 2024 | | 2023 |
Finance income |
| |
| |
| |
thereof gains from disposals and fair value adjustments of equity securities |
| |
| |
| |
thereof interest income | | | | |||
thereof miscellaneous income | | | - | |||
Finance costs |
| - |
| - |
| - |
thereof losses from disposals and fair value adjustments of equity securities | - | - | - | |||
thereof interest expense |
| - |
| - |
| - |
thereof fee expense |
| - |
| - |
| - |
thereof miscellaneous expense | - | - | - | |||
Financial income, net |
| |
| |
| - |
Financial income, net, increased €
For more information about net gains or losses on financial instruments by IFRS 9 measurement category, see Note (F.2).
(C.5) Income Taxes
y Accounting Policies, Judgments, and Estimates
We are subject to changing tax laws in multiple jurisdictions within the countries in which we operate. Our ordinary business activities also include transactions where the ultimate tax outcome is uncertain due to different interpretations of tax laws, such as those involving transfer pricing and intercompany transactions between SAP Group entities. In addition, the amount of income taxes we pay is generally subject to ongoing audits by domestic and foreign tax authorities. In determining our worldwide income tax provisions, judgment is involved in assessing whether to consider each uncertain tax treatment separately or together with one or more other uncertain tax treatments and whether to reflect the respective effect of uncertainty based on the most likely amount or the expected value. In applying these judgments, we consider the nature and the individual facts and circumstances of each uncertain tax treatment as well as the specifics of the respective jurisdiction, including applicable tax laws and our interpretation thereof.
The assessment whether a deferred tax asset is impaired requires judgment, as we need to estimate future taxable profits to determine whether the utilization of the deferred tax asset is probable. In evaluating our ability to utilize our deferred tax assets, we consider all available positive and negative evidence, including the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are recoverable. Our judgment regarding future taxable income is based on assumptions about future market conditions and future profits of SAP.
Judgment is also required in evaluating whether interest or penalties related to income taxes meet the definition of income taxes, and, if not, whether it is of financial nature. In this judgment, we particularly consider applicable local tax laws and interpretations on IFRS by national standard setters in the area of group financial reporting.
Major Components of Tax Expense
€ millions | | 2025 | | 2024 | | 2023 |
Current tax expense |
| |||||
Tax expense for current year |
| | | | ||
Taxes for prior years |
| | | | ||
Total current tax expense |
| | | | ||
Deferred tax expense/income |
| |||||
Origination and reversal of temporary differences |
| - | - | - | ||
Unused tax losses, research and development tax credits, and foreign tax credits |
| | - | | ||
Total deferred tax income |
| - | - | - | ||
Total income tax expense |
| | | |
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Table of Contents
Total deferred tax income includes an expense of €
The following table reconciles the expected income tax expense, computed by applying our combined German tax rate of
Relationship Between Tax Expense and Profit Before Tax
€ millions, unless otherwise stated | | 2025 | | 2024 | | 2023 |
Profit before tax from continuing operations |
| |
| |
| |
Tax expense at applicable tax rate of |
| |
| |
| |
Tax effect of: |
|
|
| |||
Foreign tax rates |
| - |
| - |
| - |
Non-deductible expenses |
| |
| |
| |
Tax-exempt income |
| - |
| - |
| - |
Withholding taxes |
| |
| |
| |
Research and development and foreign tax credits |
| - |
| - |
| - |
Prior-year taxes |
| |
| - |
| - |
Assessment of deferred tax assets, research and development tax credits, and foreign tax credits |
| |
| |
| |
Other |
| |
| |
| |
Total income tax expense |
| |
| |
| |
Effective tax rate (in %) |
| |
| |
| |
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Components of Recognized Deferred Tax Assets and Liabilities
€ millions | | 2025 | | 2024 |
Deferred tax assets |
| |||
Intangible assets |
| | | |
Property, plant, and equipment |
| | | |
Leases | | | ||
Other financial assets |
| | | |
Trade and other receivables |
| | | |
Other non-financial assets | | | ||
Pension provisions |
| | | |
Share-based compensation |
| | | |
Contract liabilities |
| | | |
Trade and other payables |
| | | |
Financial liabilities | | | ||
Other non-financial liabilities | | | ||
Provisions | | | ||
Net operating loss carryforwards | | | ||
Research and development and foreign tax credits |
| | | |
Total deferred tax assets (gross) |
| | | |
Netting | - | - | ||
/ Total deferred tax assets (net) | | | ||
Deferred tax liabilities |
| |||
Intangible assets |
| | | |
Property, plant, and equipment |
| | | |
Leases | | | ||
Other financial assets |
| | | |
Trade and other receivables |
| | | |
Other non-financial assets | | | ||
Pension provisions |
| | | |
Share-based compensation |
| | | |
Contract liabilities |
| | | |
Trade and other payables |
| | | |
Financial liabilities | | | ||
Other non-financial liabilities |
| | | |
Provisions | | | ||
Total deferred tax liabilities (gross) |
| | | |
Netting | - | - | ||
/ Total deferred tax liabilities (net) |
| | |
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Movement of Deferred Tax Assets and Liabilities
€ millions | | 2025 | | 2024 | | 2023 |
Total deferred tax assets (net) at the beginning of the period |
| |
| |
| |
Change in items of the Consolidated Income Statements |
| |
| |
| |
Change in items of the Consolidated Statements of Comprehensive Income |
| - |
| - |
| |
Change in items of the Consolidated Statements of Changes in Equity |
| - |
| |
| |
Change in consolidated companies |
| - |
| - |
| - |
Other changes (includes mainly currency translation differences) |
| - |
| |
| - |
Total deferred tax assets (net) at the end of the period |
| |
| |
| |
Items Not Resulting in a Deferred Tax Asset
€ millions | | 2025 | | 2024 | | 2023 |
Unused tax losses |
| |||||
Not expiring |
| | | | ||
Expiring in the following year |
| | | | ||
Expiring after the following year |
| | | | ||
Total unused tax losses |
| | | | ||
Deductible temporary differences |
| | | | ||
Unused research and development and foreign tax credits |
| |||||
Not expiring |
| | | | ||
Expiring after the following year |
| | | | ||
Total unused tax credits |
| | | |
Of the unused tax losses, €
In 2025, SAP Group entities that suffered a tax loss in either the current or the preceding period recognized deferred tax assets amounting to €
In connection with investments in subsidiaries, there were temporary taxable differences of approximately €
Global Minimum Tax
SAP falls within the scope of the global minimum taxation rules published by the Organization for Economic Co-operation and Development (OECD) and of the German Minimum Tax Law (Mindeststeuergesetz). As a result, its income tax expense increased by a single-digit million euro sum in 2025 and 2024. SAP has applied the temporary mandatory exception to recognizing and disclosing information about deferred tax assets and liabilities related to the global minimum tax.
Income Tax-Related Litigation
We are subject to ongoing tax audits by domestic and foreign tax authorities. In respect of income taxes, we are currently involved in various proceedings with foreign tax authorities mainly regarding the deductibility of intercompany royalty payments, intercompany services, and other payments. In all cases, we expect that a favorable outcome can only be achieved through litigation. For all of these matters, we have not recorded a provision as we believe that the tax authorities’ claims have no merit and that no adjustment is warranted. If, contrary to our view, the tax authorities were to prevail in their arguments before the court, we would expect to have an additional expense of approximately €
1 For a more transparent presentation in line with IAS 12, the prior-period comparative amount has been adjusted from undistributed profits to temporary taxable differences.
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(C.6) Earnings per Share
€ millions, unless otherwise stated | | 2025 | | 2024 | | 2023 |
Profit attributable to equity holders of SAP SE |
| |
| |
| |
Profit attributable to equity holders of SAP SE1 | | | | |||
Issued ordinary shares2 |
| |
| |
| |
Effect of treasury shares2 |
| - |
| - |
| - |
Weighted average shares outstanding, basic2 |
| |
| |
| |
Dilutive effect of share-based payments2 |
| |
| |
| |
Weighted average shares outstanding, diluted2 |
| |
| |
| |
Earnings per share, basic, attributable to equity holders of SAP SE (in €) from continuing operations | | | | |||
Earnings per share, basic, attributable to equity holders of SAP SE (in €)1 |
| |
| |
| |
Earnings per share, diluted, attributable to equity holders of SAP SE (in €) from continuing operations | | | | |||
Earnings per share, diluted, attributable to equity holders of SAP SE (in €)1 |
| |
| |
| |
1 from continuing and discontinued operations
2 Number of shares in millions
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Section D — Invested Capital
This section highlights our non-current assets including investments that form the basis of our operating activities. Additions to invested capital include separate asset acquisitions or business combinations. Further, we disclose information about purchase obligations and capital contributions.
(D.1) Business Combinations and Divestitures
y Measuring Non-Controlling Interests and Allocation of Consideration Transferred
We decide for each business combination whether to measure the non-controlling interest in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets.
We classify costs related to executing business combinations as general and administration expense.
In our accounting for business combinations, judgment is required in determining whether an intangible asset is identifiable and whether it should be recorded separately from goodwill. Additionally, estimating the acquisition-date fair values of the identifiable assets acquired and liabilities assumed involves considerable judgment. The necessary measurements are based on information available on the acquisition date and are based on expectations and assumptions that have been deemed reasonable by management. These judgments, estimates, and assumptions can materially affect our financial position and profit for several reasons, including the following:
– Fair values assigned to assets subject to depreciation and amortization affect the amounts of depreciation and amortization to be recorded in operating profit in the periods following the acquisition.
– Subsequent negative changes in the estimated fair values of assets may result in additional expense from impairment charges.
– Subsequent changes in the estimated fair values of liabilities and provisions may result in additional expense (if increasing the estimated fair value) or additional income (if decreasing the estimated fair value).
We acquire businesses in specific areas of strategic interest to us, particularly to broaden our product and service portfolio.
2025 Acquisitions
SmartRecruiters Acquisition
On August 1, 2025, SAP announced its intention to acquire
The acquisition is expected to help SAP strengthen its suite of HR offerings. SmartRecruiters’ products are designed to improve employee hiring decision-making and reduce time to hire. Embedded analytics and AI-powered recommendations from SAP and SmartRecruiters provide valuable insights into talent pools, prevent hiring bottlenecks, and improve workforce planning.
€ millions | | |
Cash paid |
| |
Share-based payment awards |
| |
Other incurred liabilities |
| |
Total consideration transferred |
| |
The consideration transferred amounted to US$
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The following table summarizes the values of identifiable assets acquired and liabilities assumed in connection with the acquisition of SmartRecruiters, as at the acquisition date:
€ millions | | |
Intangible assets |
| |
Cash and cash equivalents |
| |
Other identifiable assets |
| |
Total identifiable assets |
| |
Other identifiable liabilities |
| |
Total identifiable liabilities |
| |
Total identifiable net assets |
| |
Goodwill |
| |
Total consideration transferred |
| |
The initial accounting for the SmartRecruiters business combination is incomplete because we are still obtaining the information necessary to identify and measure items such as the tax-related assets and liabilities of SmartRecruiters. Accordingly, the amounts recognized in our Consolidated Financial Statements for these items are regarded as provisional as at December 31, 2025.
The goodwill arising from our acquisitions consists largely of the synergies and the know-how and skills of the acquired businesses’ workforces. SmartRecruiters goodwill was attributed to expected synergies from the acquisition, particularly in the following areas:
| - | SmartRecruiters’ Talent Acquisition (TA) suite enhances SAP’s ability to offer a more complete TA solution to customers, combining specialized capabilities with an integrated suite to support long-term success in recruiting and human capital management (HCM). |
| - | The SmartRecruiters talent acquisition platform will continue to be offered standalone and will replace an existing module within the SAP SuccessFactors HCM suite, integrating to the SAP SuccessFactors Employee Central solution, the SAP SuccessFactors Onboarding solution, and others. |
| - | The business combination facilitates new cross-selling opportunities to existing SAP customers across all regions, using SAP’s sales organization. |
The operating results and the assets and liabilities are reflected in our Consolidated Financial Statements starting September 11, 2025.
The allocation of the goodwill resulting from the SmartRecruiters acquisition to our operating segments depends on how our operating segments actually benefit from the synergies of the SmartRecruiters business combination. For more information, see Note (D.2).
Impact of Business Combinations on Our Consolidated Financial Statements
The amounts of revenue and profit or loss of the SmartRecruiters business acquired in 2025 since the acquisition date are included in the 2025 Consolidated Income Statements as follows:
| 2025 | | Contribution of | |
€ millions | as Reported | SmartRecruiters | ||
Revenue | | | ||
Profit after tax |
| |
| - |
Had SmartRecruiters been consolidated as at January 1, 2025, our estimated pro forma revenue for the reporting period would have been €
These pro forma numbers have been prepared for comparative purposes only. The pro forma revenue and profit numbers are not necessarily indicative of the results of operations that would have actually occurred had the acquisition been in effect at the beginning of the respective periods or of future results.
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2024 Acquisitions
WalkMe Acquisition
On June 5, 2024, SAP announced its intent to acquire
The acquisition is expected to help SAP expand its business transformation portfolio. WalkMe solutions are designed to help companies navigate ongoing technological change by providing users with advanced guidance and automation capabilities.
€ millions | | |
Cash paid |
| |
Replacement share-based payment awards |
| |
Call option exercise liability |
| |
Total consideration transferred |
| |
The consideration transferred amounted to US$
The following table summarizes the values of identifiable assets acquired and liabilities assumed in connection with the acquisition of WalkMe, as at the acquisition date:
WalkMe Acquisition: Recognized Assets and Liabilities
€ millions | | |
Intangible assets |
| |
Cash and cash equivalents | | |
Other identifiable assets |
| |
Total identifiable assets |
| |
Other identifiable liabilities |
| |
Total identifiable liabilities |
| |
Total identifiable net assets |
| |
Goodwill |
| |
Total consideration transferred |
| |
In the third quarter of 2025, measurement of tax-related assets and liabilities for the WalkMe business combination accounting was completed and resulted in a €
In general, the goodwill arising from our acquisitions consists largely of the synergies and the know-how and skills of the acquired businesses’ workforces.
WalkMe goodwill was attributed to expected synergies from the acquisition, particularly in the following areas:
| - | Evolution of SAP’s strategy to improve adoption, through a WalkMe solution that empowers companies to enhance the utilization of their SaaS systems, increase employee and end-user productivity, and reduce training and support costs |
| - | Cross-selling of WalkMe products to existing SAP customers across all regions, enabling seamless workflow execution across business software applications |
| - | Improved user experience and user productivity by coupling WalkMe’s AI capabilities with SAP’s copilot Joule, driving adoption of existing SAP solutions |
| - | Creation of new business process intelligence offerings by combining WalkMe products and SAP products |
| - | Improved profitability in WalkMe sales and operations |
The operating results and the assets and liabilities are reflected in our Consolidated Financial Statements starting September 12, 2024.
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Impact of Business Combinations on Our Consolidated Financial Statements
The amounts of revenue and profit or loss of the WalkMe business acquired in 2024 since the acquisition date were included in our Consolidated Income Statements for 2024 as follows:
2024 | ||||
€ millions | | as Reported | | Contribution of WalkMe |
Revenue | | | ||
Profit after tax |
| |
| - |
Had WalkMe been consolidated as at January 1, 2024, our estimated pro forma revenue for the reporting period would have been €
These pro forma numbers have been prepared for comparative purposes only. The pro forma revenue and profit numbers are not necessarily indicative of the results of operations that would have actually occurred had the acquisition been in effect at the beginning of the respective periods or of future results.
2023 Acquisitions
LeanIX Acquisition
On September 7, 2023, SAP announced its intent to acquire
The acquisition closed on November 7, 2023, following satisfaction of customary closing conditions and regulatory approvals; the operating results and the assets and liabilities are reflected in our Consolidated Financial Statements starting on that date.
Consideration transferred amounted to €
LeanIX Acquisition: Recognized Assets and Liabilities
€ millions | | |
Intangible assets |
| |
Other identifiable assets |
| |
Total identifiable assets |
| |
Other identifiable liabilities |
| |
Total identifiable liabilities |
| |
Total identifiable net assets |
| |
Goodwill |
| |
Total consideration transferred |
| |
In the fourth quarter of 2024, measurement of tax-related assets and liabilities for the LeanIX business combination accounting was completed and resulted in an €
In general, the goodwill arising from our acquisitions consists largely of the synergies and the know-how and skills of the acquired businesses’ workforces.
LeanIX goodwill was attributed to expected synergies from the acquisition, particularly in the following areas:
| - | Cross-selling to existing SAP customers across all regions, using SAP’s sales organization |
| - | Creation of new offerings by combining LeanIX products and SAP products |
| - | Enhanced transformation capabilities of SAP Signavio solutions, giving SAP customers unique clarity on the IT landscapes they need to reap the full benefit of business transformation |
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Impact of the Business Combination on Our Consolidated Financial Statements
The amounts of revenue and profit or loss of the LeanIX business acquired in 2023 since the acquisition date were included in our Consolidated Income Statements for 2023 as follows:
| 2023 | | Contribution of | |
€ millions | as Reported | LeanIX | ||
Revenue |
| | | |
Profit after tax |
| | - |
Had LeanIX been consolidated as at January 1, 2023, our revenue and profit after tax for 2023 would not have been materially different.
2023 Divestitures
Qualtrics Disposal
On March 13, 2023, resulting from a process that was initiated on January 26, 2023, SAP announced it had agreed to sell all of its
SAP is a close go-to-market and technology partner for Qualtrics.
SAP’s financial results present Qualtrics as a discontinued operation as required under IFRS 5. The Qualtrics disposal group was previously included in the Qualtrics reportable segment.
The pre-tax disposal gain included in discontinued operations (€
The cash inflow resulting from the purchase price (€
SAP continues to provide rental guarantees for certain offices used by Qualtrics. Qualtrics is obligated to indemnify SAP with respect to the guarantees.
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Additional financial information relating to Qualtrics is presented in the following tables (revenues and expenses are presented after consolidation of transactions between Qualtrics and SAP’s continuing operations):
€ millions, unless otherwise stated | | 2023 | | 2022 |
Consolidated Income Statements |
| |
| |
Cloud revenue |
| |
| |
Total revenue |
| |
| |
Cost of cloud |
| - |
| - |
Total cost of revenue |
| - |
| - |
Total operating expenses (including total cost of revenue) |
| - |
| - |
Disposal gain before tax |
| |
| |
Operating profit |
| |
| - |
Profit (loss) before tax |
| |
| - |
Income tax expense1 |
| - |
| |
Profit (loss) after tax |
| |
| - |
Attributable to owners of parent |
| |
| - |
Earnings per share, basic (IFRS, in €)2 |
| |
| - |
Earnings per share, diluted (IFRS, in €)2 |
| |
| - |
Consolidated Statements of Cash Flow |
|
| ||
Net operating cash flow |
| |
| - |
Net investing cash flow |
| |
| - |
Net financing cash flow |
| |
| - |
1 For 2023, €
2 For 2023 and 2022, the weighted average number of shares was
Total operating expenses includes share-based payment expenses related to Qualtrics’ equity-settled plan of €
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(D.2) Goodwill
y Goodwill and Intangible Asset Impairment Testing
The annual goodwill impairment test is performed at the operating segment level, since there are no lower levels in SAP at which goodwill is monitored for internal management purposes.
In general, the test is performed at the same time (at the beginning of the fourth quarter) for each annual reporting period for all operating segments.
In making impairment assessments for our goodwill and intangible assets, the outcome of these tests is highly dependent on management’s assumptions regarding future cash flow projections and economic risks, which require significant judgment and assumptions about future developments. They can be affected by a variety of factors, including:
- Changes in business strategy
- Internal forecasts
- Estimation of weighted-average cost of capital
Changes to the assumptions underlying our goodwill and intangible assets impairment assessments could require material adjustments to the carrying amount of our recognized goodwill and intangible assets as well as the amounts of impairment charges recognized in profit or loss.
The outcome of goodwill impairment tests may also depend on the allocation of goodwill to our operating segments. This allocation involves judgment as it is based on our estimates as to which operating segments are expected to benefit from the synergies of business combinations.
Changes in our segment structure result in the reallocation of goodwill with the reallocated goodwill being calculated based on relative values (if a direct allocation is not possible).
Goodwill
€ millions | | |
Historical cost |
| |
1/1/2024 |
| |
Foreign currency exchange differences |
| |
Additions from business combinations |
| |
12/31/2024 |
| |
Foreign currency exchange differences |
| - |
Additions from business combinations | | |
12/31/2025 | | |
Accumulated amortization |
| |
1/1/2024 |
| |
Foreign currency exchange differences |
| |
12/31/2024 |
| |
Foreign currency exchange differences |
| - |
12/31/2025 |
| |
Carrying amount |
| |
12/31/2024 |
| |
12/31/2025 |
| |
In the first half of 2025, the Company changed its segment structure. Effective January 1, 2025, the Company has
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Our assessment in 2025, taking into account external factors such as changes in the business environment and markets and internal factors such as the change in our segment structure and reorganizations which had no adverse effect, led us to conclude that no triggering events occurred since our annual goodwill impairment test in 2024. Throughout 2025, we have—through a qualitative and quantitative analysis—been continuously monitoring whether triggering events exist. We did not identify any aspects that qualify as a triggering event that would cause the carrying amount of either operating segment to exceed the recoverable amount.
For impairment testing purposes, the carrying amount of goodwill is allocated to the operating segments expected to benefit from goodwill as follows:
Goodwill by Operating Segment
| Applications, | | | |||
€ millions | Technology & Support1 | Core Services | Total | |||
12/31/2024 | |
| NA |
| | |
12/31/2025 |
| |
| |
| |
1 The ATS goodwill opening balance was adjusted by €
Based on the expected synergies, the goodwill added through the acquisition of SmartRecruiters (€
Goodwill Impairment Test
The key assumptions on which management based its cash flow projections for the period covered by the underlying business plans are as follows:
Key Assumption | | Basis for Determining Values Assigned to Key Assumption |
Budgeted revenue growth | Revenue growth rate achieved in the current year, adjusted for an expected increase in SAP’s addressable cloud and database markets; expected growth in the established software applications and analytics markets. Values assigned reflect our past experience and our expectations regarding an increase in the addressable markets. | |
Budgeted operating margin | Operating margin budgeted for a given budget period equals the operating margin achieved in the current year, increased by expected efficiency gains. Values assigned reflect past experience, except for efficiency gains. | |
Discount rates | Our estimated cash flow projections are discounted to present value using discount rates (after-tax rates). Discount rates are based on the weighted average cost of capital (WACC) approach. | |
Terminal growth rate | Our estimated cash flow projections for periods beyond the business plan were extrapolated using segment-specific terminal growth rates. These growth rates do not exceed the long-term average growth rates for the markets in which our segments operate. |
Key Assumptions and Detailed Planning Period
Applications, | ||||||||
Percent, unless otherwise stated | Technology & Support | Core Services | ||||||
| 12/31/2025 | | 12/31/2024 | | 12/31/2025 | | 12/31/2024 | |
Budgeted revenue growth (average of the budgeted period) |
| |
| NA |
| | NA | |
After-tax discount rate | | NA | | NA | ||||
Terminal growth rate |
| |
| NA |
| | NA | |
Detailed planning period (in years) | NA | NA | ||||||
On October 1, 2025, we performed a goodwill impairment test for our operating segments:
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Applications, Technology & Support Segment
The recoverable amount was determined based on a fair value less costs of disposal calculation. The fair value measurement was categorized as a Level 3 fair value based on the inputs used in the valuation. The cash flow projections were based on actual operating results and specific estimates covering a detailed planning period and the terminal growth rate thereafter. The projected results were determined based on management’s estimates and are consistent with the assumptions a market participant would make (a target operating margin of
We believe that no reasonably possible change in any of the above key assumptions would cause the carrying amount of our Applications, Technology & Support segment to exceed the recoverable amount.
Core Services Segment
The recoverable amount was determined based on a fair value less costs of disposal calculation. The fair value measurement was categorized as a Level 3 fair value based on the inputs used in the valuation. The cash flow projections were based on actual operating results and specific estimates covering a detailed planning period and the terminal growth rate thereafter. The projected results were determined based on management’s estimates and are consistent with the assumptions a market participant would make (a target operating margin of
The recoverable amount exceeded the carrying amount by €
We believe that no reasonably possible change in terminal growth rate and discount rate would cause the carrying amount of our Core Services segment to exceed the recoverable amount.
The following table shows the amounts by which the key assumptions would need to change individually (that is, without changing the other key assumptions) for the recoverable amount to be equal to the carrying amount. For budgeted revenue growth sensitivity, the cost structure was not adjusted, hence leading to a modified terminal operating margin.
Sensitivity to Change in Assumptions
| Core Services | |
| 12/31/2025 | |
Budgeted revenue growth (change in pp) |
| - |
Target operating margin at the end of the budgeted period (change in pp) |
| - |
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(D.3) Intangible Assets
y Recognition of Intangibles
Whereas in general, expenses for internally generated intangibles are expensed as incurred, development expenses incurred on standard-related customer development projects (for which the IAS 38 criteria are met cumulatively) are capitalized on a limited scale with those amounts being amortized over the estimated useful life for the majority of the projects of to
Determining whether internally generated intangible assets from development qualify for recognition requires significant judgment, particularly in the following areas:
- Determining whether activities should be considered research activities or development activities
- Determining whether the conditions for recognizing an intangible asset are met requires assumptions about future market conditions, customer demand, and other developments.
- The term “technical feasibility” is not defined in IFRS, and therefore determining whether the completion of an asset is technically feasible requires judgment and a company-specific approach.
- Determining the future ability to use or sell the intangible asset arising from the development and the determination of the probability of future benefits from sale or use
- Determining whether a cost is directly or indirectly attributable to an intangible asset and whether a cost is necessary for completing a development
These judgments impact the total amount of intangible assets that we present in our balance sheet as well as the timing of recognizing development expenses in profit or loss.
y Measurement of Intangibles
All our purchased intangible assets other than goodwill have finite useful lives. They are initially measured at acquisition cost and subsequently amortized based on the expected consumption of economic benefits over their estimated useful lives ranging from to
Judgment is required in determining the following:
- The useful life of an intangible asset, as this is based on our estimates regarding the period over which the intangible asset is expected to generate economic benefits to us
- The amortization method, as IFRS requires the straight-line method to be used unless we can reliably determine the pattern in which the asset’s future economic benefits are expected to be consumed by us
Both the amortization period and the amortization method have an impact on the amortization expense that is recorded in each period.
y Classification of Intangibles
We classify intangible assets according to their nature and use in our operations. Software and database licenses consist primarily of technology for internal use, whereas acquired technology consists primarily of purchased software to be incorporated into our product offerings. Customer relationships and other intangibles consist primarily of customer relationships and acquired trademark licenses.
Amortization expenses of intangible assets are classified as Cost of cloud, Cost of services, Research and development, Sales and marketing, and General and administration, depending on the use of the respective intangible assets.
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Intangible Assets
Customer | ||||||||
| Software and | | Acquired | | Relationships and | | ||
€ millions | | Database Licenses | Technology | Other Intangibles | Total | |||
Historical cost | ||||||||
1/1/2024 |
| | | | | |||
Foreign currency exchange differences |
| | | | | |||
Additions from business combinations |
| | | | | |||
Other additions |
| | | | | |||
Retirements/disposals |
| - | - | - | - | |||
Transfers | | | - | | ||||
12/31/2024 |
| | | | | |||
Foreign currency exchange differences |
| - | - | - | - | |||
Additions from business combinations |
| | | | | |||
Other additions |
| | | | | |||
Retirements/disposals |
| - | | - | - | |||
Transfers | | | - | | ||||
12/31/2025 |
| | | | | |||
Accumulated amortization |
| |||||||
1/1/2024 |
| | | | | |||
Foreign currency exchange differences |
| | | | | |||
Additions amortization |
| | | | | |||
Retirements/disposals |
| - | - | - | - | |||
12/31/2024 |
| | | | | |||
Foreign currency exchange differences |
| - | - | - | - | |||
Additions amortization |
| | | | | |||
Retirements/disposals |
| - | - | - | - | |||
12/31/2025 |
| | | | | |||
Carrying amount |
| |||||||
12/31/2024 |
| | | | | |||
12/31/2025 |
| | | | |
Significant Intangible Assets
Remaining | ||||||||
Carrying Amount | Useful Life | |||||||
€ millions, unless otherwise stated | 2025 | 2024 | (in years) | |||||
Concur – Customer relationships |
| |
| |
| to | ||
LeanIX - Customer relationships | | | ||||||
WalkMe - Customer relationships |
| |
| |
| |||
Total significant intangible assets |
| |
| |
| | ||
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(D.4) Property, Plant, and Equipment
y Depreciation of Property, Plant and Equipment |
Property, plant, and equipment are typically depreciated using the straight-line method. Judgment is required in estimating the useful life of the assets. In this assessment we consider, among others, our history with similar assets and current and future changes in technology. |
Useful Lives of Property, Plant, and Equipment
Buildings | | Predominantly |
Leased assets and leasehold improvements | Based on the term of the lease contract | |
Information technology equipment | ||
Office furniture | ||
Automobiles |
Property, Plant, and Equipment
| | | Other Property, | Advance | | |||||||
Other Property, | Plant, and | Payments and | ||||||||||
Land and | Plant, and | Equipment | Construction | |||||||||
€ millions | Land and Buildings | Buildings Leased | Equipment | Leased | in Progress | Total | ||||||
12/31/2024 | | | | | | | ||||||
12/31/2025 | | | | | | | ||||||
Additions | ||||||||||||
12/31/2024 |
| | | | | | | |||||
12/31/2025 |
| | | | | | |
The additions (other than from business combinations) relate primarily to the replacement and purchase of information technology equipment and the construction and leasing of buildings and data centers. For more information about leases, see Note (D.5).
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(D.5) Leases
y Accounting Policies, Judgments, and Estimates
Under IFRS 16, a contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. As a lessee, SAP recognizes a right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. The right-of-use assets are depreciated on a straight-line basis and interest expense is recognized on the lease liabilities. The vast majority of our leases consist of facility and data center leases. Payments for short-term and low-value leases are expensed over the lease term. Extension options are included in the lease term if their exercise is reasonably certain.
Leases in the Balance Sheet
€ millions | | 12/31/2025 | | 12/31/2024 |
Right-of-use assets | ||||
Right-of-use assets – land and buildings | |
| | |
Right-of-use assets – other property, plant, and equipment | |
| | |
Total right-of-use assets | |
| | |
/ Property, plant, and equipment | |
| | |
Right-of-use assets as % of / Property, plant, and equipment | |
| | |
Lease liabilities | ||||
Current lease liabilities | |
| | |
/ Current financial liabilities | |
| | |
Current lease liabilities as % of / Current financial liabilities | |
| | |
Non-current lease liabilities | |
| | |
/ Non-current financial liabilities | |
| | |
Non-current lease liabilities as % of / Non-current financial liabilities | |
| |
Leases in the Income Statement
€ millions | | 2025 | | 2024 |
Lease expenses within operating profit | ||||
Depreciation of right-of-use assets | |
| |
For more information about right-of-use asset additions, see Note (D.4), and for a maturity analysis of lease liabilities, see Note (F.1). For more information about the cash flow related to lease liabilities, see the “Reconciliation of Liabilities Arising from Financing Activities” table within Note (E.3).
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(D.6) Equity Investments
y Accounting Policies, Judgments, and Estimates
We generally classify financial assets into the following categories: at amortized cost (AC), at fair value through other comprehensive income (FVOCI), and at fair value through profit or loss (FVTPL), depending on the contractual cash flows of and our business model for holding the respective asset.
For equity securities, as the cash flow characteristics are other than solely principal and interest, we take an investment-by-investment decision whether to classify as FVTPL or FVOCI.
The valuation of equity securities of private companies requires judgment because it is typically based on significant unobservable inputs, as no market prices are available and there is inherent lack of liquidity.
We take the most recent qualitative and quantitative information aspects into consideration to determine the fair value estimates of these equity securities.
Considerable judgment and assumptions are involved with regard to the selection of appropriate comparable company data, the assessment of cash requirements of the business, the acceptance of the technology or products in the addressable markets, the actual and forecasted performance, the milestone achievements, the adequacy of price points from financing rounds, the transaction of similar securities of the same company, the rights and preferences of the underlying securities, the selection of adequate equity allocation parameters, the possible exit scenarios and associated weightings. Because all of these assumptions could change significantly, and because valuation is inherently uncertain, our estimated fair values may differ significantly from the values that would have been used had market prices for the investments existed and that will ultimately be realized, and those differences could be material.
Gains/losses on equity securities at FVTPL include gains/losses from fair value fluctuations, from disposals as well as dividends, while gains/losses on equity securities at FVOCI only include dividends, all of which are shown in Financial income, net. Regular way purchases and sales are recorded as at the trade date.
Equity Investments
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Equity securities |
| |
| |
| |
| |
| |
| |
Investments in associates |
| |
| |
| |
| |
| |
| |
Equity investments |
| |
| |
| |
| |
| |
| |
Other financial assets | | | | | | | ||||||
Equity investments as % of Other financial assets | | | | | | | ||||||
Investments in Associates
SAP has interests in a number of individually immaterial associates. We own more than 20% of the equity interests or have at least 20% of the voting rights in these entities. Based on these facts and the nature of the relationships, SAP has determined that it has significant influence.
The following table shows, in aggregate, the carrying amount and share of profit of these associates.
€ millions | | 2025 | | 2024 |
Carrying amount of interest in associates |
| |
| |
Share of profit and losses from continuing operations |
| |
| |
The vast majority of the carrying amount of interest in associates relates to SAP Fioneer GmbH.
For a list of the names of other equity investments, see Note (G.9).
Financial Commitments in Venture Capital Funds
€ millions | | 2025 | | 2024 |
Committed investments in venture capital funds |
| |
| |
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SAP invests and holds interests in unrelated parties that manage investments in venture capital. On December 31, 2025, total commitments to make such investments amounted to €
Maturities
| 31/12/2025 | |
Investments in Venture | ||
€ millions | Capital Funds | |
Due 2026 |
| |
Total |
| |
(D.7) Non-Current Assets by Region
The table below shows non-current assets excluding financial instruments, deferred tax assets, post-employment benefit assets, and rights arising under insurance contracts.
Non-Current Assets by Region
€ millions | | 2025 | | 2024 |
Germany |
| |
| |
Rest of EMEA |
| |
| |
EMEA |
| |
| |
United States |
| |
| |
Rest of Americas |
| |
| |
Americas |
| |
| |
India | | | ||
Rest of APJ | | | ||
APJ |
| |
| |
SAP Group |
| |
| |
The decrease in the United States is primarily due to foreign currency exchange differences for goodwill, which is partially offset by the acquisition of SmartRecruiters. For more information, see Note (D.1) and Note (D.2).
For a breakdown of our employee headcount by region, see Note (B.1), and for a breakdown of revenue by region, see Note (A.1).
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(D.8) Purchase Obligations
€ millions | | 2025 | | 2024 |
Contractual obligations for acquisition of property, plant, and equipment and intangible assets |
| |
| |
Other purchase obligations |
| |
| |
Purchase obligations |
| |
| |
The contractual obligations for acquisition of property, plant, and equipment and intangible assets relate primarily to the purchase of hardware, software, patents, office equipment, and vehicles. The remaining obligations relate mainly to cloud services, marketing, consulting, maintenance, license agreements, and other third-party agreements. The decrease is mainly due to payments made for cloud infrastructure services. Historically, the majority of such purchase obligations have been realized.
Maturities
| 12/31/2025 | |
€ millions | Purchase Obligations | |
Due 2026 |
| |
Due 2027 to 2030 |
| |
Due thereafter |
| |
Total |
| |
(D.9)Income-Related Government Grants
y Recognition of Income-Related Government Grants
We recognize income-related government grants as a reduction of the related expense in the period in which the expense is incurred.
At the end of 2023, we received a grant from the German government to fund research and development expenditures related to cloud infrastructure. The grant will provide reimbursements of up to €
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Section E — Capital Structure, Financing, and Liquidity
This section describes how SAP manages its capital structure. Our capital management is based on a high equity ratio, modest financial leverage, a well-balanced maturity profile, and high debt capacity.
(E.1) Capital Structure Management
The primary objective of our capital structure management is to maintain a strong financial profile for investor, creditor, and customer confidence, and to support the growth of our business. We seek to maintain a capital structure that will allow us to continuously cover our funding requirements through the capital markets on reasonable terms and, in so doing, ensure a high level of independence, confidence, and financial flexibility.
SAP’s prime principle of financial risk management is to safeguard liquidity at a level to be able to meet all our financial obligations. To support this goal, SAP’s principal use of cash is focused on:
| - | Capital expenditure |
| - | Quick repayment of financial debt |
| - | Acquisitions and venture activities |
| - | Payment of dividends |
| - | Share buybacks to return excess cash to shareholders |
SAP SE’s long-term credit rating is “A1” by Moody’s (stable outlook) and “A+” by S&P Global Ratings (stable outlook).
12/31/2025 | 12/31/2024 | |||||||||
% of | % of | |||||||||
Total equity and | Total equity and | |||||||||
| € millions | | liabilities | | € millions | | liabilities | | ∆ in % | |
/ Equity |
| |
| |
| |
| |
| - |
/ Current liabilities |
| |
| |
| |
| |
| - |
/ Non-current liabilities |
| |
| |
| |
| |
| - |
/ Liabilities |
| |
| |
| |
| |
| - |
Thereof financial debt | | | | | - | |||||
Thereof lease liabilities | | | | | - | |||||
/ Total equity and liabilities |
| |
| |
| |
| |
| - |
In September 2024, SAP drew a short-term loan of €
(E.2) Total Equity
y Accounting for Interests in Subsidiaries
Changes in SAP’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. When SAP loses control over the subsidiary, it derecognizes the assets and liabilities of the subsidiary, and any related non-controlling interests (NCI) and other components of equity. Any resulting gain or loss is recognized in profit or loss.
Issued Capital
SAP SE has issued no-par value bearer shares with a calculated nominal value of €
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Number of Shares
Millions | Issued Capital | Treasury Shares | ||
1/1/2023 |
| |
| - |
Purchase of treasury shares |
| |
| - |
Reissuance of treasury shares under share-based payments | | | ||
12/31/2023 |
| | - | |
Purchase of treasury shares |
| | - | |
Reissuance of treasury shares under share-based payments |
| | | |
12/31/2024 |
| | - | |
Purchase of treasury shares | | - | ||
Reissuance of treasury shares under share-based payments | | | ||
12/31/2025 |
| | - |
For more information about the share repurchase program executed during the period from 2023 to 2025, see the Treasury Shares section below.
Authorized Shares
The Articles of Incorporation authorize the Executive Board to increase the issued capital as follows:
| - | By up to a total amount of € |
| - | By up to a total amount of € |
Contingent Shares
SAP SE’s share capital is subject to a contingent capital increase, which will be implemented only insofar as the holders or creditors of convertible bonds or stock options issued or guaranteed by SAP SE or any of its directly or indirectly controlled subsidiaries under certain share-based payments exercise their conversion or subscription rights, and no other methods for servicing these rights are used. As at December 31, 2025, €
Share Premium
The share premium is used to recognize the value of equity-settled share-based payments granted to our employees.
For more information about our share-based payments, see Note (B.3).
Retained Earnings
Retained earnings mainly comprise profit after tax and dividend payments as well as transactions with non-controlling interests.
Other Components of Equity
Cash Flow | ||||||
Exchange | Hedges/Cost of | |||||
€ millions | | Differences | | Hedging | | Total |
1/1/2023 |
| |
| | | |
Other comprehensive income for items that will be reclassified to profit or loss, net of tax |
| - |
| - |
| - |
12/31/2023 |
| |
| | | |
Other comprehensive income for items that will be reclassified to profit or loss, net of tax |
| | - | | ||
12/31/2024 |
| | - | | ||
Other comprehensive income for items that will be reclassified to profit or loss, net of tax |
| - | | - | ||
12/31/2025 |
| | | |
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Treasury Shares
By resolution of SAP SE’s Annual General Meeting of Shareholders held on May 11, 2023, the authorization granted by the Annual General Meeting of Shareholders on May 17, 2018, regarding the acquisition of treasury shares was revoked to the extent it had not been exercised at that time, and replaced by a new authorization of the Executive Board of SAP SE to acquire, on or before May 10, 2028, shares of SAP SE representing a pro rata amount of capital stock of up to €
Following the above authorization, in May 2023 we announced a share buyback program with an aggregate volume of up to €
Distribution Policy and Dividends
Our general intention is to remain in a position to return liquidity to our shareholders by distributing annual dividends totaling at least
In 2025, we distributed €
The total dividend available for distribution to SAP SE shareholders is based on the profits of SAP SE as reported in its statutory financial statements prepared under the accounting rules in the German Commercial Code (Handelsgesetzbuch). For the year ended December 31, 2025, the Executive Board intends to propose that a dividend of €
Non-Controlling Interests
In 2025, a profit of €
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(E.3) Liquidity
y Accounting for Non-Derivative Financial Instruments
Classification and Measurement of Non-Derivative Financial Debt Investments
Our non-derivative financial debt investments comprise cash at banks and cash equivalents (highly liquid investments with original maturities of three months or less, such as time deposits and money-market funds), loans and other financial receivables, and acquired debt securities.
We generally classify financial assets as: at amortized cost (AC), at fair value through other comprehensive income (FVOCI), or at fair value through profit or loss (FVTPL), depending on the contractual cash flows of, and our business model for, holding the respective asset. Financial assets having cash flow characteristics other than solely principal and interest such as money market and similar funds are classified as FVTPL. Generally, other financial assets with cash flows consisting solely of principal and interest are held within a business model whose objective is “hold to collect” and are thus classified as AC. Occasionally, such other financial assets are held within a business model whose objective is “hold to collect and sell” in which case they are classified as FVOCI.
Gains/losses on non-derivative financial debt investments at FVTPL are reported in Financial income, net and show interest income/expenses separately from other gains/losses which include gains/losses from fair value fluctuations and disposals. Gains/losses on non-derivative financial debt investments at AC are reported in Financial income, net and show interest income/expenses separately from other gains/losses which include gains/losses on disposals and changes in expected and incurred credit losses. Gains/losses from foreign currency exchange rate fluctuations are included in Other non-operating income/expense, net. Regular way purchases and sales are recorded as at the trade date.
Impairment of Non-Derivative Financial Debt Investments
For these financial assets, we apply considerable judgment by employing the general impairment approach as follows:
| - | For cash at banks, time deposits, and debt securities such as acquired bonds and acquired commercial papers, we apply the low credit risk exception, as it is our policy to invest only in high-quality assets of issuers with a minimum rating of at least investment grade to minimize the risk of credit losses. Thus, these assets are always allocated to stage 1 of the three-stage credit loss model, and we record a loss allowance at an amount equal to 12-month expected credit losses. This loss allowance is calculated based on our exposure at the respective reporting date, the loss given default for this exposure, and the credit default swap spread as a measure for the probability of default. Even though we invest only in assets of at least investment-grade, we also closely observe the development of credit default swap spreads as a measure of market participants’ assessments of the creditworthiness of a debtor to evaluate probable significant increases in credit risk to timely react to changes should these manifest. Among others, we consider cash at banks, time deposits, and debt securities to be in default when the counterparty is unlikely to pay its obligations in full, when there is information about a counterparty’s financial difficulties or if there is a drastic increase in a counterparty’s credit default swap spread for a prolonged time period while the overall market environment remains generally stable. Such financial assets are written off either partially or in full if the likelihood of recovery is considered remote, which might be evidenced, for example, by the bankruptcy of a counterparty of such financial assets. |
| - | Loans and other financial receivables are monitored based on borrower-specific internal and external information to determine whether there has been a significant increase in credit risk since initial recognition. We consider such assets to be in default if they are significantly beyond their due date or if the borrower is unlikely to pay its obligation. A write-off occurs when the likelihood of recovery is considered remote, for example when bankruptcy proceedings have been finalized or when all enforcement efforts have been exhausted. |
Non-Derivative Financial Liabilities
Non-derivative financial liabilities include bank loans, issued bonds, private placements, and other financial liabilities. Other financial liabilities also include customer funding liabilities which are funds we draw from and make payments on behalf of our customers for customers’ employee expense reimbursements, related credit card payments, and vendor payments. We present these funds in cash and cash equivalents and record our obligation to make these expense reimbursements and payments on behalf of our customers as customer funding liabilities.
As we do not designate financial liabilities as FVTPL, we generally classify non-derivative financial liabilities as AC.
Expenses and gains or losses on financial liabilities at AC mainly consist of interest expense which is shown in Financial income, net. Gains/losses from foreign currency exchange rate fluctuations are included in Other non-operating income/expense, net.
Group Liquidity, Financial Debt, and Net Debt
Group liquidity consists of cash at banks, money market and other funds, as well as time deposits and debt securities (both with remaining maturities of less than one year). Financial debt is defined as the nominal volume of bank loans, issued commercial papers, private placements, and bonds. Net debt is group liquidity less financial debt.
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Group Liquidity and Net Debt
€ millions | | 2025 | | 2024 | | ∆ |
/ Cash and cash equivalents |
| |
| |
| - |
Current time deposits and debt securities |
| |
| |
| - |
Group liquidity |
| |
| |
| - |
Current financial debt |
| - |
| - |
| |
Non-current financial debt |
| - |
| - |
| |
Financial debt |
| - |
| - |
| |
Net cash (+) / Net debt (–) |
| |
| |
| |
While we continuously monitor the ratios presented in the capital structure table, we actively manage our liquidity and structure of our financial indebtedness based on the ratios group liquidity and net debt.
Cash and Cash Equivalents
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Cash at banks |
| |
| |
| |
| |
| |
| |
Time deposits |
| |
| |
| |
| |
| |
| |
Money market and other funds |
| |
| |
| |
| |
| |
| |
Debt securities |
| |
| |
| |
| |
| |
| |
Expected credit loss allowance |
| - |
| |
| - |
| - |
| |
| - |
/ Cash and cash equivalents |
| |
| |
| |
| |
| |
| |
Non-Derivative Financial Debt Investments
2025 | 2024 | |||||||||||
€ millions | | Current | | Non-Current | | Total | | Current | | Non-Current | | Total |
Time deposits | | | | | | | ||||||
Debt securities | | | | | | | ||||||
Financial instruments related to employee benefit plans | | | | | | | ||||||
Loans and other financial receivables |
| |
| |
| |
| |
| |
| |
Expected credit loss allowance |
| - |
| |
| - |
| - |
| |
| - |
Non-derivative financial debt investments | | | | | | | ||||||
/ Other financial assets |
| |
| |
| |
| |
| |
| |
Non-derivative financial debt investments as % of / Other financial assets |
| |
| |
| |
| |
| |
| |
Time deposits with original maturity of three months or less are presented as cash and cash equivalents, and those with original maturities of greater than three months (investments considered in group liquidity) are presented as other financial assets. Debt securities consist of acquired commercial papers and acquired bonds of mainly financial and non-financial corporations and municipalities.
For more information about financial risk and the nature of risk, see Note (F.1).
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Financial Debt
2025 | 2024 | |||||||||||||||||||
Nominal Volume | Carrying Amount | Nominal Volume | Carrying Amount | |||||||||||||||||
€ millions | | Current | | Non-Current | | Current | | Non-Current | | Total | | Current | | Non-Current | | Current | | Non-Current | | Total |
Bonds |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Private placement transactions |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Commercial paper | | | | | | | | | | | ||||||||||
Bank loans |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Financial debt |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
/ Financial liabilities | |
| | | | | | |||||||||||||
Financial debt as % of / Financial liabilities |
|
| |
| |
| |
|
| |
| |
| | ||||||
Financial liabilities are unsecured, except for the retention of title and similar rights customary in our industry. Effective interest rates on our financial debt (including the effects from interest rate swaps) were
None of our financial debt is restricted by financial covenants. Our financial debt includes covenants customarily used, such as change of control or regulatory changes that trigger an immediate repayment. Bonds are classified as non-current as at December 31, 2025, as SAP has an existing right to defer settlement for at least 12 months after the reporting period. For more information about the risk associated with our financial liabilities, see Note (F.1). For more information about fair values, see Note (F.2).
Bonds
2025 | 2024 | ||||||||||||||
| | | | | Nominal Volume | | | ||||||||
(in respective | Carrying | Carrying | |||||||||||||
Effective Interest | currency | Amount | Amount | ||||||||||||
Maturity | Issue Price | Coupon Rate | Rate | in millions) | (in € millions) | (in € millions) | |||||||||
Eurobond 9 – 2014 |
| 2027 |
| | % |
| | % | € | |
| |
| | |
Eurobond 12 – 2015 |
| 2025 |
| | % |
| | % | € | |
| |
| | |
Eurobond 15 – 2018 | 2026 | | % | | % | € | | | | ||||||
Eurobond 16 – 2018 | 2030 | | % | | % | € | | | | ||||||
Eurobond 20 – 2018 | 2028 | | % | | % | € | | | | ||||||
Eurobond 21 – 2018 | 2031 | | % | | % | € | | | | ||||||
Eurobond 23 – 2020 | 2026 | | % | | % | € | | | | ||||||
Eurobond 24 – 2020 | 2029 | | % | | % | € | | | | ||||||
Eurobonds |
|
| |
| | ||||||||||
USD bond - 2018 | 2025 | | % | | % | US$ | | | | ||||||
Bonds | | | |||||||||||||
All of our Eurobonds are listed for trading on the Luxembourg Stock Exchange.
Private Placements
2025 | 2024 | |||||||||||
| | | | Nominal Volume | | | ||||||
(in respective | Carrying | Carrying | ||||||||||
Effective Interest | currency in | Amount | Amount | |||||||||
Maturity | Coupon Rate | Rate | millions) | (in € millions) | (in € millions) | |||||||
U.S. private placements |
| |
| |
| |
|
| |
| | |
Tranche 9 – 2012 |
| 2027 |
|
| | % | US$ |
| |
| | |
Private placements |
|
| |
| | |||||||
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The U.S. private placement notes were issued by one of our subsidiaries that has the U.S. dollar as its functional currency. In the fourth quarter of 2025, SAP elected to proactively settle the remaining $
Commercial Paper Program
The net proceeds from our commercial paper program (Commercial Paper, or CP) are being used for general corporate purposes. As at December 31, 2025, we had €
Loans
In 2024 SAP drew short-term loans of €
Reconciliation of Liabilities Arising from Financing Activities
The changes in our financial debts are reconciled to the cash flows from borrowings included in the cash flow from financing activities.
| | | Business | | Foreign | | Fair Value | | | |||||
€ millions | 1/1/2025 | Cash Flows | Combinations | Currency | Changes | Other | 12/31/2025 | |||||||
Current financial debt |
| |
| - |
| |
| - |
| |
| |
| |
Non-current financial debt |
| |
| |
| |
| - |
| |
| - |
| |
Financial debt (nominal volume) |
| |
| - |
| |
| - |
| |
| |
| |
Basis adjustment |
| - |
| |
| |
| |
| |
| |
| - |
Transaction costs |
| - |
| |
| |
| |
| |
| |
| - |
Financial debt (carrying amount) |
| |
| - |
| |
| - |
| |
| |
| |
Accrued interest and payment to banks |
| |
| - |
| |
| |
| |
| |
| |
Interest rate swaps |
| |
| - |
| |
| |
| |
| |
| |
Lease1 | | - | | | | | | |||||||
Total liabilities from financing activities |
| |
| - |
| |
| - |
| |
| |
| |
1 Other includes new lease liabilities.
| Business | | Foreign | Fair Value | ||||||||||
€ millions | | 1/1/2024 | | Cash Flows | | Combinations | | Currency | | Changes | | Other | | 12/31/2024 |
Current financial debt | | |
| |
| |
| |
| |
| |
| |
Non-current financial debt |
| |
| |
| |
| |
| |
| - |
| |
Financial debt (nominal volume) |
| |
| |
| |
| |
| |
| |
| |
Basis adjustment |
| - |
| |
| |
| |
| |
| |
| - |
Transaction costs |
| - |
| - |
| |
| |
| |
| |
| - |
Financial debt (carrying amount) |
| |
| |
| |
| |
| |
| |
| |
Accrued interest and payment to banks |
| |
| - |
| |
| |
| |
| |
| |
Interest rate swaps | |
| - |
| |
| |
| - |
| |
| | |
Lease1 | | - | | | | | | |||||||
Total liabilities from financing activities | |
| |
| |
| |
| |
| |
| |
1 Other includes new lease liabilities.
Certain amounts in this Note have been reclassified to conform to our 2025 presentation of interest paid and interest received in the Consolidated Statements of Cash Flows. See “Updated Accounting Policy for the Presentation of Interest Paid and Interest Received” in Note (IN.1). Comparative period amounts have been adjusted accordingly.
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Section F — Management of Financial Risk Factors
Based on our global activities, we are exposed to a variety of financial risks, including market risks (mainly foreign currency exchange rate risk but also interest rate risk and equity price risk), credit risk, and liquidity risk.
Financial risk management is executed on a Group-wide basis through our global treasury, global risk management, and global credit management departments. Formal risk management policies have been established to systematically identify exposures, define appropriate risk limits, and ensure continuous risk monitoring and assessment. These policies, together with our hedging strategies, are codified within internal governance frameworks—including treasury and other internal guidelines—and are subject to ongoing review, evaluation, and enhancement to reflect changes in market conditions and the SAP Group’s evolving business profile.
We use derivative financial instruments exclusively for risk mitigation purposes within the context of prudent financial risk management, and not for speculation, which is defined as entering into derivative positions without corresponding underlying exposures.
This section provides an overview of our exposure to these risk factors and describes the corresponding risk management framework. Additionally, it contains detailed information about our financial instruments.
(F.1) Financial Risk Factors and Risk Management
y Accounting for Derivative Financial Instruments
We use derivatives to hedge foreign currency risk, interest rate risk, and equity price risk exposure resulting from SAP Group’s cash settled share-based compensation (SBC) programs, and designate them as cash flow, net investment, or fair value hedges if they qualify for hedge accounting under IFRS 9, which involves judgment.
Derivatives Not Designated as Hedging Instruments in Hedge Accounting Relationships
Many of our derivative transactions constitute economic hedges that effectively mitigate financial risks but do not qualify for, or are not designated in, hedge accounting relationships under IFRS 9.
To hedge currency risks inherent in foreign-currency denominated and recognized monetary assets and liabilities, we do not designate our derivative financial instruments classified as fair value through profit and loss (FVTPL) in hedge accounting, because the profits and losses from the underlying transactions are recognized in profit or loss in the same periods as the profits or losses from the derivatives, thereby achieving a natural offset.
In addition, we occasionally have contracts that contain foreign currency embedded derivatives that are required to be accounted for separately.
Fair value fluctuations in the spot component or intrinsic value of such derivatives at FVTPL are included in Other non-operating income/expense, net while the forward element or time value is shown in Financial income, net.
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Derivatives Designated as Hedging Instruments
a) Cash Flow Hedge
In general, we apply cash flow hedge accounting to the foreign currency risk of highly probable forecasted transactions and to share price volatility risk of highly probable cash flows resulting from our SBC programs.
With regard to foreign currency risk, hedge accounting relates to the spot element and to the intrinsic value of the derivatives designated and qualifying as cash flow hedges. Accordingly, the effective portion of these components determined on a present value basis is recorded in Other comprehensive income. The effective portion of the forward element and time value as well as foreign currency basis spreads excluded from the hedging relationship are recorded as cost of hedging in a separate position in Other comprehensive income. As the amounts are not material, they are presented together with the effective portion of the cash flow hedges in our consolidated statements of comprehensive income and consolidated statements of changes in equity. All other components including counterparty credit risk adjustments of the derivative and the ineffective portion are immediately recognized in Financial income, net in profit or loss. Amounts accumulated in Other comprehensive income are generally reclassified to profit or loss to Other non-operating income/expense, net and Financial income, net in the same period when the hedged item affects profit or loss.
With regard to SBC hedging, we designate derivatives (normally, total return equity swaps) at full fair value. Until designation, derivatives are accounted for as FVTPL, with fair value changes recognized in Financial income, net, if material.
Upon designation, the effective portion of subsequent fair value changes is recognized in Other comprehensive income and subsequently reclassified to Operating expenses within profit or loss in the same line item and periods in which the related share-based compensation expenses are recognized. The ineffective portion of fair value changes continues to be recognized immediately in Financial income, net within profit or loss.
b) Net Investment Hedge
In general, we do not hedge the foreign currency exposure arising from net assets of subsidiaries with a functional currency different from the euro, and consequently do not apply net investment hedge accounting. Notwithstanding this general approach, net investment hedge accounting is selectively applied in specific circumstances. For more information, see the section on translation risk further below in this Note.
The designated component in hedge accounting is the spot price of the derivatives designated and qualifying as net investment hedges. Accordingly, the effective portion of this component determined on a present value basis is recorded in Other comprehensive income. All other not-designated components and ineffective portions are recognized immediately in Financial income, net in profit or loss. Amounts accumulated in Other comprehensive income are reclassified to Other non-operating income/expense, net within profit or loss in the period in which the foreign operation is partially disposed of or sold.
c) Fair Value Hedge
We apply fair value hedge accounting for certain of our fixed-rate financial liabilities and show the fair value fluctuations in Financial income, net.
d) Valuation and Testing of Effectiveness
At inception of a designated hedging relationship, we document our risk management strategy and establish the economic relationship between the hedged item and the hedging instrument.
The existence of an economic relationship is demonstrated, and its prospective effectiveness is tested, as follows:
For foreign currency hedges, the critical terms match method is applied, since currencies, maturities, and the amounts are closely aligned for the forecasted transactions and for the spot element of the forward exchange rate contract or intrinsic value of the currency options, respectively.
The same methodology is applied for SBC hedging, as the underlying variable (SAP share price), maturities, and the number of underlying shares are closely aligned between equity swaps and the hypothetical derivatives representing the SBC cash flows’ sensitivity to share price volatility.
For interest rate swaps, effectiveness is tested prospectively using statistical methods in the form of a regression analysis, by which the validity and extent of the relationship between the change in value of the hedged items as the independent variable and the fair value change of the derivatives as the dependent variable is determined.
The main sources of ineffectiveness are:
| - | The effect of the counterparty and our own credit risk on the fair value of the forward exchange contracts, interest rate swaps, and equity swaps, which is not reflected in the respective hedged items; |
| - | Net cash flows from the dividend/interest component of the equity swaps, which are not part of cash flows from the hedged SBC plans; and |
| - | Initial fair value of the equity swaps at designation date |
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Foreign Currency Exchange Rate Risk
Because we conduct business worldwide, our ordinary operations are subject to risks associated with fluctuations in foreign currencies that can impact our financial performance and cash flows.
Translation Risk
Our reporting currency is the euro. Therefore, the consolidation of financial statements of subsidiaries with a functional currency other than the euro exposes us to foreign currency risk from the translation of the net assets of those subsidiaries. In accordance with IFRS, such translation risks are not considered in the following except where we hedge translation risk.
In general, translation risk is not hedged. However, on rare occasions we safeguard the euro countervalue of merger or disposal activities and apply net investment hedge accounting.
In 2025 and 2023, we hedged part of our net investment in subsidiaries which have the U.S. dollar as their functional currency, by entering into forwards. The hedged risk is the weakening of the U.S. dollar against the euro. The forwards are designated as a hedging instrument for the changes in the value of the net investment that is attributable to changes in the U.S. dollar/euro spot rate.
To assess hedge effectiveness, we have determined the economic relationship between the hedging instrument and the hedged item, by comparing changes in the carrying amount of the forwards that is attributable to a change in the spot rate with changes in the investment in the respective subsidiaries due to movements in the spot rate.
Transaction Risk
We continuously monitor our exposure to currency fluctuation risks based on monetary items and forecasted transactions and pursue a Group-wide strategy to manage foreign currency exchange rate risk, using derivative financial instruments, primarily foreign exchange forward contracts.
Recognized Monetary Assets and Liabilities
Generally, the Group’s entities conduct their operating business in their own functional currencies. However, occasionally the Group’s entities generate foreign currency-denominated receivables, payables, and other monetary items by transacting in a currency other than the respective functional currency. To mitigate the extent of the associated foreign currency exchange rate risk, a significant portion of these transactions is hedged as described above with the primary aim to reduce profit or loss volatility.
In rare circumstances, transacting in a currency other than the functional currency also leads to embedded foreign currency derivatives being separated and measured at FVTPL.
Generally, we are not exposed to any significant foreign currency exchange rate risk with regard to our investing and financing activities, as such activities are normally conducted in the functional currency of the investing or borrowing entity.
Forecasted Transactions
The intellectual property (IP) holders in the SAP Group are exposed to risks associated with forecasted intercompany cash flows in foreign currencies. These cash flows arise out of royalty payments from subsidiaries to the respective IP holder. The royalties are linked to the subsidiaries’ external revenue. This arrangement leads to a concentration of the foreign currency exchange rate risk with the IP holders, as the royalties are mostly denominated in the subsidiaries’ local currencies, while the functional currency of the IP holders with the highest royalty volume is the euro. The highest foreign currency exchange rate exposure of this kind relates to the currencies of subsidiaries with significant operations, for example the U.S. dollar, the pound sterling, the Japanese yen, the Swiss franc, and, in 2023, the Australian dollar.
With respect to forecasted transactions, up until December 2024 our risk management strategy was to reduce year-over-year profit or loss volatility via a rolling hedge horizon. Since December 2024, our forecasted exposure hedging strategy is aimed at reducing volatility from foreign currency fluctuations on the forecasted Free Cash Flow (FCF) of a calendar year by preserving foreign exchange rates on which the FCF guidance is based on. Notwithstanding the change in foreign currency exchange rate risk management, our hedged item remains a layer of the forecasted cash flows from royalty payments to IP holders as they correlate to our FCF. Due to the change in our foreign currency exchange rate risk management, we de-designated all existing cash flow hedge relationships and entered into new cash flow hedge relationships in December 2024.
We enter into derivative financial instruments, primarily foreign exchange forward contracts, to hedge such significant forecasted cash flows (royalties) from foreign subsidiaries denominated in foreign currencies with a hedge ratio of 1:1 and a hedge horizon of up to
For all years presented, no previously highly probable transaction designated as a hedged item in a foreign currency cash flow hedge relationship ceased to be probable. Therefore, we did not discontinue any of our cash flow hedge relationships except for those affected by the change in our foreign currency exchange rate risk management. Also, ineffectiveness was either not material or non-existent in all years reported. Generally, the cash flows of the hedged forecasted transactions are expected to occur and to be recognized in profit or loss monthly within the respective calendar year.
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Currency Hedges Designated as Hedging Instruments (Cash Flow Hedges and Net Investment Hedges)
The amounts as at December 31 relating to items designated as hedged items were as follows:
Designated Hedged Items in Foreign Currency Exchange Rate Hedges
Forecasted | Forecasted | |||||||
| License Payments | | Net Investment | | License Payments | | Net Investment | |
€ millions | 2025 | 2024 | ||||||
Change in value used for calculating hedge ineffectiveness | - | | | | ||||
Cash flow hedge | - | - | | | ||||
Cost of hedging | | | | | ||||
Balances remaining in cash flow hedge reserve for which hedge accounting is no longer applied | | - | | - |
The amounts as at December 31 designated as hedging instruments were as follows:
Designated Hedging Instruments in Foreign Currency Exchange Rate Hedges
| Forecasted License | | Net Investment | | Forecasted License | | Net Investment | |
Payments in EUR | in USD | Payments in EUR | in USD | |||||
€ millions | 2025 | 2024 | ||||||
Nominal amount |
| | | | | |||
Carrying amount |
| |||||||
Other financial assets |
| | | | | |||
Other financial liabilities |
| - | | - | | |||
Change in value recognized in OCI |
| | | - | | |||
Hedge ineffectiveness recognized in Finance income, net |
| - | | | | |||
Cost of hedging recognized in OCI |
| - | | - | | |||
Amount reclassified from cash flow hedge in OCI to Other non-operating income, net |
| | | - | | |||
Amount reclassified from cost of hedging in OCI to Finance income, net |
| - | | - | | |||
On December 31, we held the following instruments to hedge exposures to changes in foreign currency:
Details on Hedging Instruments in Foreign Currency Exchange Rate Hedges
Maturity | ||||||||
2025 |
| 2024 | ||||||
| 1–6 Months | | 7–12 Months | | 1–6 Months | | 7–12 Months | |
Forward exchange contracts | | | | |||||
Net exposure in € millions |
| |
| | |
| | |
Average EUR:GBP forward rate |
| |
| | |
| | |
Average EUR:JPY forward rate |
| |
| | |
| | |
Average EUR:CHF forward rate |
| |
| | |
| | |
Average EUR:USD forward rate | | | | | ||||
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Remaining Foreign Currency Exchange Transaction Risk Exposure
Our risk exposure is based on the following assumptions:
| - | The SAP Group’s entities generally operate in their functional currencies. In exceptional cases and limited economic environments, operating transactions are denominated in currencies other than the functional currency, leading to a foreign currency exchange rate risk for the related monetary instruments. Where material, this foreign currency exchange rate risk is hedged. Therefore, fluctuations in foreign currency exchange rates only have an impact on profit and loss with regard to our unhedged non-derivative monetary financial instruments and related income or expenses. |
| - | Our free-standing derivatives designed for hedging foreign currency exchange rate risks almost completely balance the changes in the fair values of the hedged item attributable to exchange rate movements in the Consolidated Income Statements in the same period. As a consequence, the hedged items and the hedging instruments are not exposed to foreign currency exchange rate risks, and thereby have no effect on profit and loss. |
Consequently, we are only exposed to significant foreign currency exchange rate fluctuations with regard to the following:
| - | The spot component of derivatives held within a designated cash flow hedge relationship affecting other comprehensive income |
| - | Foreign currency embedded derivatives affecting other non-operating expense, net |
| - | Unhedged foreign - currency monetary assets and liabilities affecting other non - operating expense, net |
Thus, our foreign currency exposure (and our average/high/low exposure) as at December 31 was as follows:
Foreign Currency Exposure
€ billions | | 2025 | | 2024 |
Year-end exposure toward all our major currencies |
| |
| |
Average exposure |
| |
| |
Highest exposure |
| |
| |
Lowest exposure |
| |
| |
Foreign Currency Exchange Rate Sensitivity
If, on December 31, the foreign currency exchange rates had been higher/lower as described below, this would have had the following effects on other non-operating expense, net and other comprehensive income:
Foreign Currency Sensitivity
Effects on Other Non-Operating Expense, Net | Effects on Other Comprehensive Income | |||||||||||
€ millions | | 2025 | | 2024 | | 2023 | | 2025 | | 2024 | | 2023 |
Derivatives held within a designated cash flow hedge relationship |
| |||||||||||
All major currencies – |
| | | | ||||||||
All major currencies + |
| - | - | - | ||||||||
thereof: USD – |
| | | | ||||||||
thereof: USD + | - | - | - | |||||||||
Embedded derivatives | ||||||||||||
All currencies – |
| - | - | - | ||||||||
All currencies + | | | | |||||||||
thereof: EUR – | - | - | - | |||||||||
thereof: EUR + | | | | |||||||||
Unhedged monetary assets and liabilities | ||||||||||||
All currencies – | - | - | - | |||||||||
All currencies + | | | | |||||||||
thereof: USD – | - | - | - | |||||||||
thereof: USD + | | | | |||||||||
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Interest Rate Risk
We are exposed to interest rate risk as a result of our investing and financing activities mainly denominated in euros and U.S. dollars, since a significant portion of our investments is based on variable rates and/or short maturities (2025:
The objective of our interest rate risk management is to reduce profit or loss volatility and optimize our net interest result within the framework of an asset-liability matching approach. We achieve this by incorporating interest rate derivatives into our portfolio of investments and debt financing.
Derivatives Designated as Hedging Instruments (Fair Value Hedges)
To align the interest rate risk from our financing transactions with our investments, we enter into receiver interest rate swaps to convert the interest cash flows of certain fixed-rate financial liabilities to floating rates, and by this means secure the fair value of the swapped financing transactions on a 1:1 ratio. When including interest rate swaps,
The amounts as at December 31 relating to items designated as hedged items were as follows:
Designated Hedged Items in Interest Rate Hedges
2025 |
| 2024 | ||||||
Fixed-Rate | Fixed-Rate | Fixed-Rate | Fixed-Rate | |||||
€ millions | | Borrowing in EUR | | Borrowing in USD | | Borrowing in EUR | | Borrowing in USD |
Notional amount |
| |
| |
| |
| |
Carrying amount |
| |
| |
| |
| |
Accumulated fair value adjustments in Other financial liabilities |
| |
| |
| |
| - |
Change in fair value used for measuring ineffectiveness for the reporting period |
| |
| |
| |
| - |
Accumulated amount of fair value hedge adjustments for hedged items ceased to be adjusted for hedging gains/losses |
| |
| |
| |
| - |
The amounts as at December 31 designated as hedging instruments were as follows:
Designated Hedging Instruments in Interest Rate Hedges
2025 |
| 2024 | ||||||
Interest Rate | Interest Rate | Interest Rate | Interest Rate | |||||
Swaps for | Swaps for | Swaps for | Swaps for | |||||
€ millions | | EUR Borrowing | | USD Borrowing | | EUR Borrowing | | USD Borrowing |
Notional amount |
| |
| |
| |
| |
Carrying amount |
| |||||||
Other financial assets |
| |
| |
| |
| |
Other financial liabilities |
| - |
| |
| - |
| |
Change in fair value used for measuring ineffectiveness for the reporting period |
| - |
| |
| - |
| - |
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As at December 31, we held the following instruments to hedge exposures to changes in interest rates:
Details on Hedging Instruments in Interest Rate Hedges
2025 |
| ||||||||||
Maturity |
| ||||||||||
€ millions | | 2027 | 2028 | 2029 | 2030 | 2031 |
| ||||
EUR interest rate swaps |
|
|
|
| | ||||||
Nominal amounts |
| |
| |
| | | | |||
Average variable interest rate1 |
| | % | | % | | % | | % | | % |
USD interest rate swaps |
|
| |
| |
| | ||||
Nominal amounts |
| ||||||||||
Average variable interest rate1 |
|
| | | | | | | | | 2024 |
| |
Maturity |
| ||||||||||
€ millions | 2027 | 2028 | 2029 | 2030 | 2031 |
| |||||
EUR interest rate swaps |
| |
| |
| |
| |
| | |
Nominal amounts |
| |
| |
| |
| |
| |
|
Average variable interest rate1 |
| | % | | % | | % | | % | | % |
USD interest rate swaps |
| |
| |
| |
| |
| | |
Nominal amounts |
| |
| |
| |
| |
| | |
Average variable interest rate1 |
| |
| |
| |
| |
| |
1 Computed based on the interest rate curve as at December 31 of the respective reporting period.
Remaining Interest Rate Exposure
Our interest rate exposure (and our average/high/low exposure) as at December 31 was as follows:
Interest Rate Risk Exposure
2025 | 2024 | |||||||||||||||
€ billions | | Year-End | | Average | | High | | Low | | Year-End | | Average | | High | | Low |
Fair value interest rate risk | ||||||||||||||||
From investments |
| |
| |
| |
| |
| |
| |
| |
| |
Cash flow interest rate risk |
|
|
|
|
|
|
| |||||||||
From investments (including interest - bearing cash) |
| |
| |
| |
| |
| |
| |
| |
| |
From financing |
| |
| |
| |
| |
| |
| |
| |
| |
From interest rate swaps |
| |
| |
| |
| |
| |
| |
| |
| |
Interest Rate Sensitivity
In compliance with IFRS 7, the following sensitivity analysis is provided to show the potential impact of interest rate fluctuations on profit or loss and equity, based on the following considerations:
| - | Non-derivative fixed-rate instruments: Changes in interest rates only affect the accounting for non-derivative fixed-rate financial instruments if they are recognized at fair value. Therefore, such interest rate changes do not change the carrying amounts of our non-derivative fixed-rate financial liabilities, as we account for them at amortized cost. Investments in fixed-rate financial assets classified as fair value through profit or loss were not material at each year end reported. Thus, we do not consider any fixed-rate instruments in the profit-related sensitivity calculation. |
| - | Non-derivative variable-rate instruments: Income or expenses arising from non-derivative variable interest rate financial instruments are subject to interest rate risk if they are not hedged items in an effective hedge relationship. Thus, we take into consideration interest rate changes relating to our variable-rate financing and our investments in money market instruments in the profit-related sensitivity calculation. |
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| - | Derivative hedging instruments: The designation of interest rate receiver swaps in a fair value hedge relationship leads to interest rate changes affecting Financial income, net. The fair value movements related to the interest rate swaps are not reflected in the sensitivity calculation, as they offset the fixed interest rate payments for the bonds and private placements as hedged items. However, changes in market interest rates affect the amount of interest payments from the interest rate swap. As a consequence, we include those effects of market interest rates on interest payments in the profit-related sensitivity calculation. |
If, on December 31, interest rates had been higher/lower, this would have had the following effects on Financial income, net:
Interest Rate Sensitivity
Effects on Financial Income, Net | ||||||
€ millions | | 2025 | | 2024 | | 2023 |
Derivatives held within a designated fair value hedge relationship | ||||||
Interest rates + |
| - |
| - |
| - |
Interest rates – |
| |
| |
| |
Variable-rate financing |
|
|
| |||
Interest rates + |
| |
| - |
| |
Interest rates – | | | | |||
Variable-rate investments | ||||||
Interest rates + | | | | |||
Interest rates – |
| - |
| - | - | |
Equity Price Risk
Equity Price Risk Management
We are exposed to equity price risk with regard to our investments in equity securities, as well as through the cash settled components of our share based compensation (SBC) programs.
Venture Capital Activities
Our listed equity investments are monitored based on the current market value, which is affected by the fluctuations in the volatile stock markets worldwide. Unlisted equity investments are monitored based on detailed financial information provided by the investees. The fair value of our listed equity investments depends on the equity prices, while the fair value of the unlisted equity investments is influenced by various unobservable input factors.
Equity Price Exposure
On December 31, 2025, our exposure from our investments in equity securities was €
Equity Price Sensitivity
Our sensitivity towards a fluctuation in equity prices is as follows:
Equity Price Sensitivity
€ millions | | 2025 | | 2024 | | 2023 |
Investments in equity securities |
| |
| | ||
Increase in equity prices and respective unobservable inputs of | |
| |
| | |
Decrease in equity prices and respective unobservable inputs of | - |
| - |
| - |
For purposes of our equity price sensitivity disclosure, we benchmarked the historical average of public market returns of the NASDAQ and S&P 500 to the average annual venture capital benchmark returns over a 12-year period, which is the assumed average holding period of venture capital funds. Overall, our analysis indicated a blended return range of +/-
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Share-Based Compensation Hedging
As a result of the cash-settled components of SAP’s SBC programs, we are exposed to a Group-wide volatility in SAP’s share price, which directly impacts our SBC payment obligations (for more information about SBC payouts, see Note (B.3)). To manage this exposure on a consolidated basis, SAP started using total return equity swaps as hedging instruments in March 2025.
As at December 31, our exposure to the hedged risk represented by the number of cash-settled stock units held by employees was as follows:
Exposure to Cash-Settled RSUs
thousands | | 2025 | | 2024 |
Number of Restricted Stock Units (RSUs) |
| |
| |
Number of Performance Stock Units (PSUs) |
| |
| |
Total gross exposure |
| |
| |
Number of hedged RSUs |
| |
| |
Total net exposure |
| |
| |
SAP hedges a specific layer of cash flows from SBC programs based on grant date(s), with each forming a distinct hedge relationship. SAP hedges only RSUs, excluding PSUs, to minimize fluctuations in the hedged population, since PSU vesting quantities depend not only on employment status at time of vesting but also on performance metric achievement.
Furthermore, SAP hedges up to
All SBC hedge relationships maintain a
Under the equity swap arrangements, a swap contract is established between SAP and the counterparty bank for each grant date (or multiple grant dates), featuring multiple settlement dates corresponding to RSU vesting dates (tranches).
At each vesting date, SAP and the bank exchange the difference between the final share price and the initial swap price for that tranche. Additionally, SAP pays interest to the bank based on floating interest rates, which are adjusted to account for dividends that would otherwise be paid by the bank to SAP.
For all periods presented, no previously highly probable transactions designated as hedged items in SBC cash flow hedge relationships ceased to be probable. Consequently, no cash flow hedge relationships were discontinued.
The amounts as at December 31 relating to items designated as hedged items were as follows:
Designated Hedged Items in SBC Hedges
€ millions | | 2025 | | 2024 |
Change in value used for calculating hedge ineffectiveness |
| |
| |
Cash flow hedge reserve balance |
| |
| |
Balances remaining in cash flow hedge reserve for which hedge accounting is no longer applied |
| |
| |
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The amounts as at December 31 designated as hedging instruments were as follows:
Designated Hedging Instruments in SBC Hedges
€ millions, unless stated otherwise | | 2025 | | 2024 |
Nominal amount in number of RSUs, thousands |
| |
| |
Nominal amount in EUR |
| |
| |
Carrying amount: |
| |
| |
Other financial assets |
| |
| |
Other financial liabilities |
| - |
| |
Change in value used for calculating hedge ineffectiveness |
| - |
| |
Change in value recognized in OCI |
| - |
| |
Hedge ineffectiveness recognized in Finance income, net |
| |
| |
Amount reclassified from cash flow hedge in OCI to Operating profit |
| |
| |
On December 31, we held the following instruments designated in SBC hedging:
Details on Hedging Instruments in SBC Hedges
| | | | | | | | Maturity of the Remaining Tranches | ||||
2025 | | 2024 | ||||||||||
Less Than | More Than | Less Than | More Than | |||||||||
12 Months | 12-24 Months | 24 Months | 12 Months | 12-24 Months | 24 Months | |||||||
Nominal amount in number of RSUs, thousands | | | | | | | ||||||
Initial swap price, in EUR: | ||||||||||||
March 2025 swap |
| |
| — | ||||||||
April 2025 swap |
| |
|
| |
| — |
| | |||
Nominal amount in € millions |
| |
| |
| |
| |
| |
| |
Sensitivity Analysis
At year end 2025, fair value changes in the equity swaps impacted Group profit or loss and equity through the Cash flow hedge reserve and amounts reclassified from the Cash flow hedge reserve to profit or loss (hedge ineffectiveness from these relationships is immaterial). The primary driver of the fair value volatility of the equity swaps is SAP share price variability. However, since the same risk factor drives volatility in hedged SBC expenses, any change in the equity swaps’ impact on profit or loss is offset by corresponding changes in SBC expenses related to the hedged RSU population. Impacts on equity (other comprehensive income) are not offset; therefore, the table below presents the increase or decrease in other comprehensive income that would have resulted had SAP’s share price at year end increased or decreased by
Equity Swaps Sensitivity
| | Effects on Other Comprehensive Income | ||||
€ millions | 2025 | 2024 | 2023 | |||
Increase in SAP share price of | - | — | — | |||
Decrease in SAP share price of | | — | — | |||
Credit Risk
We are exposed to credit risk to the extent either our customers or our counterparts for financial instruments fail to meet their contractual obligations. In the absence of collateral or other significant agreements to reduce our credit risk exposure, the total nominal amounts of cash and cash equivalents, current investments, loans, other financial receivables, derivative financial assets, trade receivables, and financial guarantees represent our maximum exposure to credit risks.
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Cash at Banks, Time Deposits, and Debt Securities
To mitigate the credit risk from our investing activities and derivative financial assets, we conduct all our activities only with approved financial institutions and issuers that meet stringent credit quality standards as required by our internal treasury policies. These policies mandate a minimum credit rating of “BBB” (flat) for all investments, with exceptions to this threshold permitted only in limited circumstances. Such below-threshold investments were not significant relative to total investment balances in all years presented. The weighted average credit rating of our financial assets portfolio is “A–”.Our investment approach is characterized by prudent asset allocation, emphasizing short-term maturities, conventional investment instruments, and broad portfolio diversification across multiple counterparties.
To further reduce our credit risk, we require collateral for certain investments in the full amount of the investment volume (2025: €
In addition, the concentration of credit risk that exists when counterparties are involved in similar activities by instrument, sector, or geographic area is mitigated through global diversification of counterparties and adherence to an internal counterparty limit framework. This framework establishes exposure limits for individual counterparties based on the lowest available long-term credit rating from major rating agencies, the counterparty’s Tier 1 capital, or participation in deposit guarantee schemes such as the German Depositors’ Guarantee Fund or equivalent protection mechanisms. Compliance with these counterparty limits is monitored on an ongoing basis. Additionally, we actively monitor credit default swap spreads as a market-based indicator of counterparty creditworthiness, enabling timely identification of emerging credit risks and prompt implementation of appropriate risk mitigation measures.
For cash at banks, time deposits, and debt securities (including bonds and commercial paper), we apply the general impairment approach. As it is our policy to only invest in high-quality assets of issuers with a minimum rating of at least investment grade to minimize the risk of credit losses, we use the low credit risk exception. Thus, these assets are always allocated to stage 1 of the three-stage credit loss model and we record a loss allowance for an amount equal to 12-month expected credit losses. This loss allowance is calculated based on our exposure as at the respective reporting date, the loss given default for this exposure, and the credit default swap spread as a measure for the probability of default. To ensure continued compliance with investment-grade criteria throughout the life of our investments, we monitor changes in credit risk by tracking published external credit ratings.
We consider cash at banks, time deposits, and debt securities to be in default when the counterparty is unlikely to pay its obligations in full, there is evidence of significant financial difficulties, or credit default swap spreads widen materially for an extended period while broader market conditions remain stable. Such financial assets are written off either partially or in full if the likelihood of recovery is considered remote, which might be evidenced by, for example, counterparty bankruptcy or insolvency proceedings.
Trade Receivables
Credit risk associated with trade receivables is managed through a dedicated assessment process that evaluates customer creditworthiness using external credit ratings and the Company’s past experience of customer payment behavior. Based on this evaluation, individual credit limits are established for each customer, with any exceptions requiring management approval.
We apply the simplified impairment approach under IFRS 9, using a provision matrix to recognize lifetime expected credit losses for all trade receivables and contract assets at initial recognition.
For the provision matrix, customers are segmented into distinct risk categories primarily based on historical credit loss experience within the respective SAP subsidiaries.
Loss rates representing lifetime expected credit losses are determined using a roll-rate methodology that considers the probability of receivables progressing through successive stages of delinquency and actual historical credit loss experience. These loss rates are adjusted for forward-looking information to reflect differences between historical economic conditions, current circumstances, and anticipated economic developments over the expected life of the receivables. Forward-looking adjustments incorporate credit default swap fluctuations for countries in which our customers operate.
Outstanding receivables are monitored continuously at the local level to identify objective evidence of credit impairment. Indicators of credit impairment include overdue payment status, information regarding significant financial difficulty of the customer, or failure to adhere to agreed payment terms. Receivables are considered to be in default when the counterparty is unlikely to fulfill its payment obligations in full. However, payment delays (such as amounts overdue beyond 90 days) in the ordinary course of business do not automatically constitute default. Receivables are written off, either partially or fully, when recovery is deemed remote, as may be evidenced by completed bankruptcy proceedings or exhaustion of collection efforts and enforcement actions.
The impact of individual customer defaults on our trade receivables portfolio is mitigated by our extensive and diversified customer base spanning multiple industries, customer sizes, and countries worldwide. For more information about trade receivables, see Note (A.2).
F-77
Table of Contents
Credit Risk Exposure
Cash, Time Deposits, and Debt Securities
As at December 31, our exposure to credit risk from cash, time deposits, and debt securities was as follows:
Credit Risk Exposure from Cash, Time Deposits, and Debt Securities
2025 | ||||||||||
| Equivalent to External | | Weighted Average Loss | | Gross Carrying Amount | | Gross Carrying Amount | | ||
€ millions, unless otherwise stated | Rating | Rate | Not Credit-Impaired | Credit-Impaired | ECL Allowance | |||||
Risk class 1 - low risk |
| AAA to BBB- |
| - | % | |
| |
| - |
Risk class 2 - high risk |
| BB+ to D |
| | % | |
| |
| |
Risk class 3 - unrated |
| NA |
| - | % | |
| |
| - |
Total |
|
| - | % | |
| |
| - | |
2024 | ||||||||||
| Equivalent to External | | Weighted Average Loss | | Gross Carrying Amount | | Gross Carrying Amount | | ||
€ millions, unless otherwise stated | Rating | Rate | Not Credit-Impaired | Credit-Impaired | ECL Allowance | |||||
Risk class 1 - low risk |
| AAA to BBB- |
| - | % | |
| |
| - |
Risk class 2 - high risk |
| BB+ to D |
| | % | |
| |
| |
Risk class 3 - unrated |
| NA |
| - | % | |
| |
| - |
Total |
|
| - | % | |
| |
| - | |
Master Netting and Similar Arrangements
We enter into derivatives on the basis of the German Master Agreement on Financial Derivatives Transactions (“Deutscher Rahmenvertrag für Finanztermingeschäfte”) and similar agreements. The regulations of these agreements apply particularly in the case of insolvency and not during the normal course of business.
The following table shows the derivative instruments that are subject to such netting arrangements:
Master Netting and Similar Arrangements
2025 | 2024 | |||||||||||
| | Nettable Amounts | | | | | ||||||
in Case of | Nettable amounts in | |||||||||||
€ millions | | Carrying Amounts | Insolvency | Net Amount | Carrying Amounts | Case of Insolvency | Net Amount | |||||
Financial assets |
| |
| |
| |
| |
| |
| |
Financial liabilities |
| - |
| - |
| - |
| - |
| - |
| - |
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Table of Contents
Trade Receivables
As at December 31, our exposure to credit risk from trade receivables was as follows:
Credit Risk Exposure from Trade Receivables
| 2025 | |||||||
| | Gross Carrying Amount | | Gross Carrying Amount | | |||
€ millions, unless otherwise stated | Weighted Average Loss Rate | Not Credit-Impaired | Credit-Impaired | ECL Allowance | ||||
AR not due and due |
| - | % | | | - | ||
AR overdue 1 to 30 days |
| - | % | | | - | ||
AR overdue 30 to 90 days |
| - | % | | | - | ||
AR overdue more than 90 days |
| - | % | | | - | ||
TOTAL |
| - | % | | | - | ||
| 2024 | |||||||
| Gross Carrying Amount | | Gross Carrying Amount | | ||||
€ millions, unless otherwise stated | Weighted Average Loss Rate | Not Credit-Impaired | Credit-Impaired | ECL Allowance | ||||
AR not due and due |
| - | % | | | - | ||
AR overdue 1 to 30 days |
| - | % | | | - | ||
AR overdue 30 to 90 days |
| - | % | | | - | ||
AR overdue more than 90 days |
| - | % | | | - | ||
TOTAL |
| - | % | | | - | ||
The movement in the ECL allowance for trade receivables is as follows:
Movement in ECL Allowance for Trade Receivables
| 2025 | | 2024 | |
€ millions | ECL Allowance | ECL Allowance | ||
Balance as at 1/1 | - | - | ||
Net credit losses recognized |
| - |
| - |
Amounts written off |
| |
| |
Balance as at 12/31 |
| - |
| - |
F-79
Table of Contents
Liquidity Risk
We are exposed to liquidity risk from our financial obligations including obligations towards suppliers, employees, and financial institutions.
Our liquidity is managed by our global treasury department with the primary aim of maintaining liquidity at a level that is adequate to meet our financial obligations and ensuring the availability of funding through adequate levels of committed credit facilities.
Our primary source of liquidity is represented by our operating cash flows. Our global treasury department centrally manages liquidity for all subsidiaries, pooling cash surpluses where possible to optimize deployment across the Group for operational requirements, subsidiary funding needs, or short-term investment opportunities.
This centralized approach enables us to optimize returns while maintaining adequate liquid assets and marketable securities, as strategic reserve to preserve our financial flexibility and strength.
In addition to effective working capital and cash management, we have reduced our liquidity risk by arranging an adequate volume of committed credit facilities with various financial institutions.
In 2023, SAP SE entered into a sustainability-linked revolving credit facility with a volume of €
In September 2019, we initiated a commercial paper (Commercial Paper, or CP) program. As at December 31, 2025, we had €
Additionally, as at December 31, 2025 and 2024, the Group had available lines of credit totaling €
The table below is an analysis of the remaining contractual maturities of all our financial liabilities and guarantees held as at December 31.
Financial liabilities for which repayment can be requested by the contract partner at any time are assigned to the earliest possible period. Variable interest payments were calculated using the latest relevant interest rate fixed as at December 31. As we generally settle our derivative contracts gross, we show the pay and receive legs separately for all our currency, interest rate and share-based compensation derivatives, whether or not the fair value of the derivative is negative. The cash outflows for the currency derivatives are translated using the applicable spot rate.
We continue to provide rental guarantees for certain offices used by Qualtrics. The amounts shown for the financial guarantees are the gross amounts we guarantee, however, we are entitled to indemnification payments by Qualtrics which will reduce the guarantee amounts disclosed.
F-80
Table of Contents
Contractual Maturities of Non-Derivative Financial Liabilities
Carrying | ||||||||||||||
Amount | Contractual Cash Flows | |||||||||||||
€ millions | | 12/31/2025 | | 2026 | 2027 | | 2028 | | 2029 | | 2030 | | Thereafter | |
Non-derivative financial liabilities | ||||||||||||||
Trade payables |
| - | - | | | | | | ||||||
Bonds | - | - | - | - | - | - | - | |||||||
Private placements | | | | | | | | |||||||
Loans | | | | | | | | |||||||
Commercial Paper | - | - | | | | | | |||||||
Lease liabilities |
| - | - | - | - | - | - | - | ||||||
Other financial liabilities1 |
| - | - | - | | | | | ||||||
Total of non-derivative financial liabilities |
| - | - | - | - | - | - | - | ||||||
Financial guarantees |
| | - | - | - | - | - | - | ||||||
Carrying | ||||||||||||||
Amount | Contractual Cash Flows | |||||||||||||
€ millions | | 12/31/2024 | | 2025 | | 2026 | 2027 | | 2028 | | 2029 | | Thereafter | |
Non-derivative financial liabilities | ||||||||||||||
Trade payables |
| - | - | | | | | | ||||||
Bonds | - | - | - | - | - | - | - | |||||||
Private placements | - | - | - | - | | | | |||||||
Loans | - | - | | | | | | |||||||
Commercial Paper | - | - | | | | | | |||||||
Lease liabilities |
| - | - | - | - | - | - | - | ||||||
Other financial liabilities1 |
| - | - | - | | | | | ||||||
Total of non-derivative financial liabilities |
| - | - | - | - | - | - | - | ||||||
Financial guarantees |
| | - | - | - | - | - | - | ||||||
1 The carrying amount of other financial liabilities includes accrued interest for our non - derivative financial debt as well as for derivatives, while the cash outflow of this accrued interest is presented together with the underlying liability in the maturity analysis.
F-81
Table of Contents
Contractual Maturities of Derivative Financial Liabilities and Financial Assets
Carrying | Carrying | |||||||||||
Amount | Contractual Cash Flows | Amount | Contractual Cash Flows | |||||||||
€ millions | | 12/31/2025 | | 2026 | | Thereafter | | 12/31/2024 | | 2025 | | Thereafter |
Derivative financial liabilities and assets | ||||||||||||
Derivative financial liabilities | | | | | | | | | | | | |
Currency derivatives not designated as hedging instruments | - | - | ||||||||||
Cash outflows | - | | - | | ||||||||
Cash inflows | | | | | ||||||||
Currency derivatives designated as hedging instruments | - |
| - |
| ||||||||
Cash outflows |
|
| - |
| - | |||||||
Cash inflows |
|
| |
| | |||||||
Interest rate derivatives without designated hedge relationship | | | ||||||||||
Cash outflows | ||||||||||||
Cash inflows | ||||||||||||
Interest rate derivatives designated as hedging instruments | - | - | ||||||||||
Cash outflows | - | - | - | - | ||||||||
Cash inflows | | | | | ||||||||
Equity swaps designated as hedging instruments |
| - |
|
| |
|
| |||||
Cash outflows |
|
| - |
| - |
| |
| | |||
Cash inflows |
|
| | |
| | | |||||
Total of derivative financial liabilities |
| - |
| - |
| - | - |
| - |
| - | |
Derivative financial assets |
| |||||||||||
Currency derivatives not designated as hedging instruments |
| |
|
| |
|
| |||||
Cash outflows |
|
| - |
|
| - |
| |||||
Cash inflows |
|
| |
|
| |
| |||||
Currency derivatives designated as hedging instruments |
| |
|
| |
|
| |||||
Cash outflows |
|
| - |
|
| - |
| |||||
Cash inflows |
|
| |
|
| |
| |||||
Total of derivative financial assets |
| |
| |
| | |
| |
| | |
Total of derivative financial liabilities and assets |
| - |
| - |
| - | - |
| - |
| - | |
Other
In the fourth quarter of 2025, SAP entered into physical power purchase agreements (PPAs) with delivery start in 2026 to increase the share of renewable electricity and to achieve price stability. In this context, we early adopted the 2024 amendments to IFRS 9 and IFRS 7 ‘Contracts Referencing Nature-dependent Electricity’ in 2025, which had no material impact on our financial statements.
(F.2) Fair Value and Other Disclosures on Financial Instruments
y Level Transfers
It is our policy that transfers between the different levels of the fair value hierarchy are deemed to have occurred at the beginning of the period of the event or change in circumstances that caused the transfer.
Fair Value of Financial Instruments
We use various types of financial instruments in the ordinary course of business, which are classified as either amortized cost (AC), fair value through other comprehensive income (FVOCI), or fair value through profit or loss (FVTPL). For those financial instruments measured at fair value or for which fair value must be disclosed, we have categorized the financial instruments into a three-level fair value hierarchy depending on the inputs used to determine fair value and their significance for the valuation techniques.
F-82
Table of Contents
Fair Values of Financial Instruments and Classification Within the Fair Value Hierarchy
12/31/2025 | ||||||||||||||||
Measurement Categories | Fair Value | |||||||||||||||
| | Carrying | | At | | At | | | | | ||||||
€ millions | Category | Amount |
| Amortized Cost |
| Fair Value | Level 1 | Level 2 | Level 3 | Total | ||||||
Assets | | |||||||||||||||
Cash and cash equivalents |
|
| |
| ||||||||||||
Cash at banks1 | AC | | | |||||||||||||
Time deposits1 | AC | | | |||||||||||||
Money market and similar funds | FVTPL | | | | | |||||||||||
Trade and other receivables |
| |
| |
| |||||||||||
Trade receivables1 |
| AC |
| |
| | ||||||||||
Other receivables2 |
|
| |
| ||||||||||||
Other financial assets |
| |
| |
| |||||||||||
Debt securities |
| AC |
| |
| | |
|
|
| | |||||
Debt securities | FVOCI | | | | | |||||||||||
Equity securities |
| FVTPL |
| |
| | |
|
| |
| | ||||
Investments in associates2 |
|
| |
| ||||||||||||
Time deposits1 |
| AC |
| |
| | ||||||||||
Financial instruments related to employee benefit plans2 |
|
| |
| ||||||||||||
Loans and other financial receivables |
| AC |
| |
| |
| |
|
| | |||||
Derivative assets |
| |
|
|
|
|
| |||||||||
Designated as hedging instrument |
| |
|
|
|
|
| |||||||||
FX forward contracts |
|
| |
| |
| |
|
| | ||||||
Not designated as hedging instrument |
| |||||||||||||||
FX forward contracts |
| FVTPL |
| |
| |
| |
|
| | |||||
Liabilities |
| |
|
|
|
|
|
|
| |||||||
Trade and other payables |
| |
| - |
| |||||||||||
Trade payables1 |
| AC |
| - |
| - | ||||||||||
Other payables2 |
|
| - |
| ||||||||||||
Financial liabilities |
| |
| - |
| |||||||||||
Non-derivative financial liabilities |
| |
|
|
| |||||||||||
Loans1 |
| AC |
| |
| | ||||||||||
Bonds |
| AC |
| - |
| - | - |
| - | |||||||
Private placements |
| AC |
| |
| | |
| | |||||||
Lease liabilities3 | - | - | ||||||||||||||
Commercial paper | AC | - | - | - | - | |||||||||||
Other non-derivative financial liabilities |
| AC |
| - |
| - | - |
| - | |||||||
Derivative liabilities |
| |
|
|
| |||||||||||
Designated as hedging instrument |
| |
|
|
| |||||||||||
FX forward contracts |
|
| - |
| - | - |
| - | ||||||||
Interest rate swaps |
|
| - |
| - | - |
| - | ||||||||
Equity swaps | - | - | - | - | ||||||||||||
Not designated as hedging instrument |
| |
|
|
| |||||||||||
FX forward contracts |
| FVTPL |
| - |
| - | - |
| - | |||||||
Total financial instruments, net |
| |
| |
| | | - | - | |
| | ||||
F-83
Table of Contents
Fair Values of Financial Instruments and Classification Within the Fair Value Hierarchy
12/31/2024 | ||||||||||||||||
| | | Measurement Categories | | Fair Value | |||||||||||
Carrying | At |
| At | |||||||||||||
€ millions | Category | Amount | Amortized Cost | Fair Value | Level 1 | | Level 2 | | Level 3 | | Total | |||||
Assets | ||||||||||||||||
Cash and cash equivalents |
|
| |
|
|
|
| |||||||||
Cash at banks1 | AC | | | |||||||||||||
Time deposits1 | AC | | | |||||||||||||
Money market and similar funds | FVTPL | | | | | |||||||||||
Trade and other receivables |
| |
| |
|
|
|
| ||||||||
Trade receivables1 |
| AC |
| |
| |
|
|
| |||||||
Trade receivables1 | FVOCI | |
| |
| | ||||||||||
Other receivables2 |
| — |
| |
|
|
|
| ||||||||
Other financial assets |
| |
| |
|
|
|
| ||||||||
Debt securities | AC |
| |
| | |
|
|
| | ||||||
Debt securities |
| FVOCI | | | | | ||||||||||
Equity securities |
| FVTPL |
| |
| | |
|
| |
| | ||||
Investments in associates2 |
| — |
| |
|
|
|
| ||||||||
Time deposits1 |
| AC | |
| |
|
|
| ||||||||
Financial instruments related to employee benefit plans2 |
| — | |
|
|
|
| |||||||||
Loans and other financial receivables |
| AC |
| |
| |
| |
|
| | |||||
Derivative assets |
| |
|
|
|
|
| |||||||||
Designated as hedging instrument |
| |
|
|
|
|
| |||||||||
FX forward contracts |
| — |
| |
| |
| |
|
| | |||||
Interest rate swaps |
| — |
| |
| |
| |
|
| | |||||
Not designated as hedging instrument |
| |
| |||||||||||||
FX forward contracts |
| FVTPL |
| |
| |
| |
|
| | |||||
Call options for share-based payments |
| FVTPL |
| |
| |
| |
|
| | |||||
Call option on equity shares |
| FVTPL |
| | | | ||||||||||
Liabilities |
| |
|
|
|
|
|
|
| |||||||
Trade and other payables |
|
| - |
|
| |||||||||||
Trade payables1 |
| AC |
| - |
| - |
| |||||||||
Other payables2 |
| — |
| - |
|
| ||||||||||
Financial liabilities |
| |
| - |
|
| ||||||||||
Non-derivative financial liabilities |
| |
|
|
| |||||||||||
Loans1 |
| AC |
| - |
| - | - |
| - | |||||||
Bonds |
| AC |
| - |
| - | - |
| - | |||||||
Private placements |
| AC |
| - |
| - | - |
| - | |||||||
Lease liabilities3 | — | - | - | |||||||||||||
- | - | - | - | |||||||||||||
Other non-derivative financial liabilities |
| AC |
| - |
| - | - |
| - | |||||||
Derivative liabilities |
| |
| |||||||||||||
Designated as hedging instrument |
| |
|
|
| |||||||||||
FX forward contracts |
| — |
| - |
| - | - |
| - | |||||||
Interest rate swaps |
| — |
| - |
| - | - |
| - | |||||||
Not designated as hedging instrument |
| |
|
|
| |||||||||||
FX forward contracts |
| FVTPL |
| - |
| - | - |
| - | |||||||
Total financial instruments, net |
| |
| |
| | | - | - | |
| | ||||
1 We do not separately disclose the fair value for cash and cash equivalents, trade receivables, and accounts payable as their carrying amounts are a reasonable approximation of their fair values.
2 Since the line items Trade receivables, Trade payables, and Other financial assets contain both financial and non-financial assets or liabilities (such as other taxes or advance payments), the carrying amounts of non-financial assets or liabilities are shown to allow a reconciliation to the corresponding line items in the Consolidated Statements of Financial Position.
3 For lease liabilities, separate disclosure of fair value is not required.
F-84
Table of Contents
Fair Values of Financial Instruments by Instrument Classification
12/31/2025 | ||||||||
€ millions | | Category | | Carrying Amount | | At Amortized Cost | | At Fair Value |
Financial assets | ||||||||
At fair value through profit or loss |
| FVTPL |
| |
|
| | |
At fair value through other comprehensive income | FVOCI | | | |||||
At amortized cost |
| AC |
| |
| |
| |
Financial liabilities |
| |
|
|
| |||
At fair value through profit or loss |
| FVTPL |
| - |
|
| - | |
At amortized cost |
| AC |
| - |
| - |
| |
Fair Values of Financial Instruments by Instrument Classification
12/31/2024 | ||||||||
€ millions | | Category | | Carrying Amount | | At Amortized Cost | | At Fair Value |
Financial assets | ||||||||
At fair value through profit or loss |
| FVTPL |
| |
|
| | |
At fair value through other comprehensive income | FVOCI | | | |||||
At amortized cost |
| AC |
| |
| |
| |
Financial liabilities |
| |
|
|
| |||
At fair value through profit or loss |
| FVTPL |
| - |
|
| - | |
At amortized cost |
| AC |
| - |
| - |
| |
F-85
Table of Contents
Determination of Fair Values
A description of the valuation techniques and the inputs used in the fair value measurement is given below:
Financial Instruments Measured at Fair Value on a Recurring Basis
Type | | Fair Value | | Determination of Fair | | Significant | | Interrelationship |
|---|---|---|---|---|---|---|---|---|
Other financial assets | ||||||||
Money-market and similar funds | Level 1 | Quoted prices in an active market | NA | NA | ||||
Debt securities | Level 1 | Quoted prices in an active market | NA | NA | ||||
Listed equity securities | Level 1 | Quoted prices in an active market | NA | NA | ||||
Unlisted equity securities | Level 3 | Market approach. Comparable company valuation using revenue multiples derived from companies comparable to the investee. | Peer companies used (revenue multiples range from Revenues of investees Discounts for lack of marketability ( to %) | The estimated fair value would increase (decrease) if: -The revenue multiples were higher (lower) -The investees’ revenues were higher (lower) -The liquidity discounts were lower (higher) | ||||
Market approach. Venture capital method evaluating a variety of quantitative and qualitative factors such as actual and forecasted results, cash position, recent or planned transactions, and market comparable companies. | - Nature and selection of financing rounds - Weighting of financings rounds - Discounts for lack of marketability - Weighting of equity allocation method such as option pricing model and common stock equivalent model - Volatility assumptions - Estimated time to exit - Imminent exit value | The estimated fair value would increase (decrease) if: - Different financing rounds are selected - Weighting of financing rounds changes -Weighting of the applied equity allocation methods changes - Volatility assumptions were higher (lower) - Estimated time to exit increases (decreases) - The imminent exit value increases (decreases) | ||||||
Last financing round valuations | Nature and pricing indication of latest financing round | The estimated fair value would increase (decrease) if: -Price of latest financing round would increase (decrease) - the overall company value would be higher (lower) - the respective analyzed share class would be affected by this change due to its rights and preferences | ||||||
Net asset value/fair market value as reported by the respective funds | Net asset value calculations of the respective funds | The estimated fair value would increase (decrease) if: Reported net asset value of respective fund would be higher (lower) | ||||||
Call option on equity shares | Level 3 | Market approach. Venture capital method evaluating a variety of quantitative and qualitative factors such as actual and forecasted results, cash position, recent or planned transactions, and market comparable companies. | NA | NA | ||||
Other financial assets/ Financial liabilities | ||||||||
FX forward contracts | Level 2 | Discounted cash flow using par method. Expected future cash flows based on forward exchange rates are discounted over the respective remaining term of the contracts using the respective deposit interest rates and spot rates. | NA | NA | ||||
Interest rate swaps | Level 2 | Discounted cash flow. Expected future cash flows are estimated based on forward interest rates from observable yield curves and contract interest rates, discounted at a rate that reflects the credit risk of the counterparty. | NA | NA | ||||
Equity swaps | Level 2 | Discounted cash flow. Expected future cash flows are estimated based on projected share prices and projected interest rates. Projected share prices are calculated in a manner similar to the method applied for RSUs under IFRS 2. Projected interest rates are calculated from Euribor 3-month zero coupon yield curve, unless the rate for a particular period is already fixed with the bank . | NA | NA | ||||
F-86
Table of Contents
Financial Instruments Not Measured at Fair Value
Type | | Fair Value Hierarchy | | Determination of Fair Value/Valuation Technique |
Financial liabilities | ||||
Fixed-rate bonds (financial liabilities) | Level 1 | Quoted prices in an active market | ||
Fixed-rate private placements/ loans (financial liabilities) | Level 2 | Discounted cash flows Future cash outflows for fixed interest and principal are discounted over the term of the respective contracts using the market interest rates as at the reporting date. |
For other non-derivative financial assets/liabilities and variable rate financial debt, it is assumed that their carrying value reasonably approximates their fair values.
Transfers Between Levels 1 and 2
Transfers of equity securities from Level 2 to Level 1, which occurred because disposal restrictions lapsed and deducting a discount for such restriction was no longer necessary, did
Level 3 Fair Value Disclosures
The following table shows the reconciliation of fair values from the opening to the closing balances for our unlisted equity securities and call options on equity shares, as well as the deal contingent forward from our net investment hedge classified as Level 3 fair values:
Reconciliation of Level 3 Fair Values
| 2025 | 2024 | ||
Unlisted Equity Securities | ||||
| and Call Options on | |||
€ millions | Unlisted Equity Securities | Equity Shares | ||
1/1 |
| | | |
Transfers |
| | ||
Into Level 3 |
| | | |
Out of Level 3 |
| - | - | |
Purchases |
| | | |
Sales |
| - | - | |
Settlements | ||||
Gains/losses |
| |||
Included in financial income, net |
| | | |
Included in exchange differences in other comprehensive income |
| - | | |
12/31 |
| | | |
Change in unrealized gains/losses in profit or loss for equity investments held at the end of the reporting period |
| | |
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Transfers out of Level 3 are due to initial public offerings of the respective investees or distributions in kind in the form of listed investees. Changing the unobservable inputs to reflect reasonably possible alternative assumptions would not have a material impact on the fair values of our unlisted equity securities held as FVTPL as at the reporting date.
Net Gains or Losses from Financial Instruments by IFRS 9 Measurement Category
€ millions | | 2025 | | 2024 |
Financial instruments at fair value through profit or loss |
| |
| |
Financial assets measured at amortized cost |
| - |
| |
thereof interest income |
| |
| |
Financial assets at fair value through other comprehensive income (debt securities) |
| - |
| - |
thereof interest expenses |
| - |
| - |
Financial liabilities measured at amortized cost |
| |
| - |
thereof interest expenses |
| - |
| - |
Gains and losses from the disposal of financial assets measured at amortized cost are not considered material in any of the years presented.
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Section G — Other Disclosures
This section provides additional disclosures on miscellaneous topics, including information pertaining to the Executive Board, the Supervisory Board, related-party transactions, and other corporate governance topics.
(G.1) Prepaid Expenses, Advance Payments, and Other Tax Assets
2025 | 2024 | |||||||||||
€ millions | | Current | Non-Current | Total | Current | | Non-Current | | Total | |||
Prepaid expenses |
| | | | | | | |||||
Advance payments | | | | | | | ||||||
Other tax assets |
| | | | | | | |||||
Total |
| | | | | | | |||||
/ Other non-financial assets | | | | | | | ||||||
Prepaid expenses, advance payments, and other tax assets as % of / Other non-financial assets | | | | | | | ||||||
Prepaid expenses primarily consist of prepayments for hyperscalers, support services, and software royalties. Prepaid expenses for hyperscalers relate to reserved instances for computing resources and other infrastructure prepayments, which are typically purchased and paid for a term of up to three years. These contract terms and conditions influence our prepaid expenses balance.
Advance payments relate to the investment into our supply chain by prepaying suppliers in exchange for discounts.
Other tax assets primarily consist of value-added tax (VAT).
(G.2) Provisions for Interest and Penalties Related to Taxes and Other Tax Liabilities
Provisions for Interest and Penalties Related to Taxes
| 2025 | |||||
€ millions | | Current | | Non-Current | | Total |
1/1/2025 | |
| |
| | |
Addition | |
| |
| | |
Utilization | - |
| - |
| - | |
Release | - |
| - |
| - | |
Additions from business combinations | |
| |
| | |
Transfer | |
| - |
| | |
Currency impact | |
| - |
| - | |
12/31/2025 | | | | |||
Total provisions | |
| |
| | |
Provision for interest and penalties related to taxes as % of Provisions | |
| |
| | |
The provisions primarily consist of interest related to income taxes.
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Other Tax Liabilities
2025 | 2024 | |||||||||||
€ millions | | Current | Non-Current | Total | Current | | Non-Current | | Total | |||
Other tax liabilities |
| | | | | | | |||||
/ Other non-financial liabilities | | | | | | | ||||||
Other tax liabilities as % of / Other non-financial liabilities |
| | | | | | | |||||
Other tax liabilities primarily consist of VAT, payroll tax, and withholding tax.
(G.3) Other Litigation, Claims, and Legal Contingencies
This Note discloses information about intellectual property-related litigation and claims, competition law matters, and tax-related litigation other than income tax-related litigation (see Note (C.5)).
y Uncertainty in Context of Legal Matters
The policies outlined in Note (A.4) for customer-related provisions, which include provisions for customer-related litigation cases and claims, equally apply to our other litigation, claims, and legal contingencies disclosed in this Note.
The outcome of litigation and claims is intrinsically subject to considerable uncertainty. Management’s view of these matters may also change in the future. Actual outcomes of litigation and claims may differ from the assessments made by management in prior periods, which could result in a material impact on our business, financial position, profit, cash flows, or reputation. Most of the lawsuits and claims are of a very individual nature and claims are either not quantified by the claimants or the claim amounts quantified are, based on historical evidence, not expected to be a good proxy for the expenditure that would be required to resolve the case concerned. The specifics of the jurisdictions where most of the claims are located further impair the predictability of the outcome of the cases. Therefore, it is typically not practicable to reliably estimate the financial effect that these lawsuits and claims would have if SAP were to incur expenditure for these cases.
Further, the expected timing of any resulting outflows of economic benefits from these lawsuits and claims is typically uncertain and not estimable, as it depends generally on the duration of the legal proceedings and settlement negotiations required to resolve them.
We are subject to a variety of claims and lawsuits that arise from time to time in the ordinary course of our business, including proceedings and claims that relate to companies we have acquired. We will continue to vigorously defend the Company against all claims and lawsuits against us. For the ongoing Teradata litigation, we have recorded a provision of €
Among the claims and lawsuits disclosed in this Note are the following classes:
Intellectual Property-Related Litigation
Intellectual property-related litigation and claims are cases in which third parties have threatened or initiated litigation claiming that SAP violates one or more intellectual property rights that they possess. Such intellectual property rights may include patents, copyrights, and other similar rights.
Contingent liabilities exist from intellectual property-related litigation and claims for which no provision has been recognized. Generally, it is not practicable to estimate the financial impact of these contingent liabilities due to the uncertainties around the litigation and claims, as outlined above. Based on our past experience, most of the intellectual property-related litigation and claims tend to be either dismissed in court or settled out of court for amounts significantly below the originally claimed amounts. In addition to the provision which is explained in this note, we currently believe that resolving the intellectual property-related claims and lawsuits pending as at December 31, 2025, will neither individually nor in the aggregate have a material adverse effect on our business, financial position, profit, or cash flows.
Individual cases of intellectual property-related litigation and claims include the following:
The Teradata litigation claims have been pending in the U.S. federal court since 2018 when Teradata Corporation, Teradata US, Inc. and Teradata Operations, Inc. (collectively “Teradata”) filed a civil lawsuit against SAP SE, SAP America, Inc. and SAP Labs, LLC. Teradata alleges trade secret misappropriation and U.S. antitrust violations concerning the development and commercialization of the SAP HANA database. While SAP initially secured a dismissal of these claims in 2021, a 2024 appellate ruling reinstated the case, and the U.S. Supreme Court declined to review the matter in October 2025. SAP will continue to defend itself vigorously at the jury trial scheduled for March to April 2026. We have recorded a provision of €
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In 2023 and 2024, Celonis SE (together with its subsidiary Celonis USA, Inc., “Celonis”) sent letters to SAP setting out various concerns and allegations. In early 2025, SAP filed a negative declaratory judgment action in Germany denying Celonis’ allegations. In March 2025, Celonis filed a lawsuit in the U.S. federal court in California, alleging that SAP had violated U.S. antitrust and competition laws relating to SAP’s sale of products from its subsidiary Signavio, and in SAP’s communications to SAP customers and the market concerning SAP’s policies for data access. Celonis requested a preliminary injunction against SAP requiring SAP to allow Celonis to continue to use its data extraction tool, and requiring SAP to retract or correct the alleged misstatements. The parties reached an agreement on June 5, 2025, whereby Celonis withdrew its request for a preliminary injunction. While the U.S. court initially dismissed the majority of Celonis’ claims in June 2025, it allowed additional claims to proceed in October 2025 after Celonis amended its complaint. SAP subsequently filed patent counterclaims against Celonis in November 2025. The trial is currently scheduled to begin on March 8, 2027. Celonis also filed a complaint against SAP in Germany (Munich), alleging unfair competition. In addition, both SAP and Celonis have initiated several patent cases in various courts in the United States and in Germany. Additionally, SAP is currently engaged in a constructive dialogue with the German Federal Cartel Office (FCO – Bundeskartellamt) regarding a complaint raised by Celonis. We are providing the FCO with comprehensive legal and factual arguments to support SAP’s position. Celonis has stated that it will seek damages from SAP based on its various claims. At present, Celonis has not made any formal monetary demands of SAP in connection with its claims in Germany or with any patent claims. In its U.S. antitrust case, Celonis is currently seeking damages of around US$
Competition Law Claims
In September 2025, the European Commission (EC) started formal proceedings concerning SAP’s on-premise maintenance and support policies, which are based on long-established standards that are common across the global software sector. The investigation does not relate to or affect our cloud offerings. To address the EC’s concerns and to end the formal proceedings, SAP suggested remedies which were market tested by the EC in 2025 and are pending final EC approval in 2026. The suggested remedies have no effect on our financial results in 2025, and we do not anticipate that they will have a material impact on our future financial performance.
Tax-Related Litigation
We are subject to ongoing audits by domestic and foreign tax authorities. In respect of non-income taxes, we are involved in various proceedings with foreign tax authorities mainly regarding assessments and litigation matters on intercompany services. The potential amount in dispute related to these matters for all applicable years is approximately €
For more information about our income tax-related litigation, see Note (C.5).
(G.4) Board of Directors
Executive Board
Memberships on supervisory boards and other comparable governing bodies of enterprises, other than subsidiaries of SAP, on December 31, 2025:
Christian Klein
Chief Executive Officer
Corporate Development, Sustainability, Business AI, Compliance, Corporate Communications, Customer Success, Technology & Innovation
Supervisory Board, adidas AG, Herzogenaurach, Germany
Muhammad Alam
SAP Product & Engineering
Global responsibility for all SAP business software applications including product strategy, product management, design, and development
Dominik Asam
Chief Financial Officer
Global Finance & Administration including Legal, Investor Relations, Internal Audit, Data Protection & Export Control, Government Affairs
Supervisory Board, Bertelsmann Management SE and Bertelsmann SE & Co. KGaA, Guetersloh, Germany
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Thomas Saueressig
Customer Services & Delivery
Global responsibility for long-term customer value in the cloud including customer services, premium engagements and customer support; cloud infrastructure, cloud operations, cloud lifecycle management, and private cloud delivery
Board of Directors, Nokia Corporation, Espoo, Finland
Sebastian Steinhaeuser (from February 1, 2025)
Chief Operating Officer
Global responsibility for the Board area Strategy & Operations, accelerating SAP’s strategy execution and simplifying operations
Gina Vargiu-Breuer
Chief People Officer, Labor Director
Global responsibility for the People & Culture organization, owning SAP’s People Agenda
Supervisory Board
Memberships on supervisory boards and other comparable governing bodies of enterprises, other than subsidiaries of SAP, on December 31, 2025:
Dr. h. c. mult. Pekka Ala-Pietilä2, 6, 7
Chairperson
Chairperson of the Board of Directors of Sanoma Corporation, Helsinki, Finland
Chairperson of the Board of Directors of SITRA, Helsinki, Finland (from January 1, 2026)
Chairperson of the Supervisory Board of HERE Technologies B.V., Amsterdam, Netherlands
Lars Lamadé1, 2, 7
Deputy Chairperson
Head of Global Sponsorships, SAP SE, Walldorf, Germany
Supervisory Board, Rhein-Neckar Loewen GmbH, Kronau, Germany
Jakub Černý1, 4, 5
Demand Manager, SAP ČR, Prague, Czech Republic
Pascal Demat1, 5, 7
Solution Advisor HCM, SAP Belgium, Brussels, Belgium
SAP SE Works Council (Europe), Walldorf, Germany
Aicha Evans2, 4, 6
Chief Executive Officer and Member of the Board of Directors, Zoox, Inc., Foster City, CA, United States
Board of Directors, Joby Aviation LLC, Santa Cruz, CA, United States
Marielle Ehrmann1,4,5 (from January 1, 2026)
Chief Security Compliance & Risk Officer, SAP SE, Walldorf, Germany
Andreas Hahn1, 2, 4
Product Expert, Digital Supply Chain Standards SAP SE, Walldorf, Germany
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Chairperson of the SAP SE Works Council (Europe), Walldorf, Germany
Member of the SAP SE Works Council, Walldorf, Germany
Prof. Dr. Ralf Herbrich4, 5
Managing Director and Professor for artificial intelligence and sustainability, Hasso Plattner Institute for Digital Engineering gGmbH, Potsdam, Germany
Margret Klein-Magar1, 2, 3 (until December 31, 2025)
Head of SAP Alumni Relations SAP SE, Walldorf, Germany
Chairperson of the Spokespersons’ Committee of Senior Managers of SAP SE
Jennifer Xin-Zhe Li3, 5
General Partner of Changcheng Investment Partners, Beijing, China
Board of Directors, ABB Ltd., Zurich, Switzerland
Board of Directors, Full Truck Alliance Co. Ltd., Nanjing, Jiangsu, China, and Cayman Islands
Dr. Qi Lu4
CEO, MiraclePlus Ltd., Beijing, China
Board of Directors, Pinduoduo Inc., Shanghai, China
Chairperson of the Board of Directors, Pine Field Holding Limited, Cayman Islands
Chairperson of the Board of Directors, Pine Field Holding Limited, Hong Kong, China
Chairperson of the Board of Directors, Pine Field Ltd., Beijing, China
César Martin1, 3, 4
SAP EMEA Enterprise Architect, SAP Spain, Madrid, Spain
Chairperson of the SAP Spain Works Council, Madrid, Spain
Member of the SAP SE Works Council (Europe), Walldorf, Germany
Gerhard Oswald3, 4, 7
Managing Director of Oswald Consulting GmbH, Walldorf, Germany
Advisory Board, TSG 1899 Hoffenheim Fußball-Spielbetriebs GmbH, Sinsheim, Germany
Advisory Board, appliedAI Initiative GmbH, Munich, Germany
Dr. Friederike Rotsch2, 3, 6, 7
Attorney-at-law, Königstein im Taunus, Germany
Nicolas Sabatier1, 2, 4
Retired SAP Employee
Member of the Confédération Française de l’Encadrement – Confédération Générale des Cadres (CFE-CGC union, Paris, France)
Dr. Eberhard Schick1, 3, 5
Chairperson of the SAP SE Works Council, Walldorf, Germany
Nina Straßner1, 2, 3, 7
Head of People Transformation Management BTM, SAP SE, Walldorf, Germany
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Dr. Rouven Westphal2, 5, 6
Member of the Executive Board of the Hasso Plattner Foundation, Potsdam, Germany, and Managing Director of the General Partner of HPC Germany GmbH & Co. KG, Potsdam, Germany
Advisory Board, Sharks Sports & Entertainment LLC, San José, CA, United States
Dr. Gunnar Wiedenfels3, 5
Chief Financial Officer, Warner Bros. Discovery, Inc., New York, NY, United States
Board of Directors, OWN LLC, West Hollywood, CA, United States
1 Appointed by the SAP SE Works Council (Europe)
2 Member of the Company’s Personnel and Governance Committee
3 Member of the Company’s Audit and Compliance Committee
4 Member of the Company’s Product and Technology Committee
5 Member of the Company’s Finance and Investment Committee
6 Member of the Company’s Nomination Committee
7 Member of the Company’s Government Security Committee
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(G.5) Executive and Supervisory Board Compensation
y Accounting Policy
The short-term employee benefits disclosed below in the table “Executive Board Compensation” include a short-term, one-year performance-based compensation (“short-term incentive,” STI). The STI is granted in the Executive Board member’s home currency for a single year. Payment of part of the payout amount under the STI is deferred by one or two additional years and linked to the performance of the SAP share price (“STI deferral”). The short-term employee benefits include both the granted and the deferred amount.
The share-based payment amounts disclosed below in the table “Executive Board Compensation” are based on the grant date fair value of the share units in the respective year. In 2024 and 2025, share units were issued to the Executive Board members under the LTI 2024. In 2023, share units were issued to the Executive Board members under the LTI 2020. For more information about the terms and details of these plans, see Note (B.3).
In the table “Share-Based Payment for Executive Board Members,” the share-based payment expense is the amount recorded in profit or loss under IFRS 2 (Share-Based Payment) in the respective period.
The total compensation of the Executive Board members for each of the years 2025, 2024, and 2023 was as follows:
Executive Board Compensation
€ thousands | | 2025 | 2024 | | 2023 | |
Short-term employee benefits |
| | | | ||
Share-based payment |
| | | | ||
Subtotal |
| | | | ||
Post-employment benefits |
| | - | | ||
thereof defined-benefit |
| - | - | | ||
thereof defined-contribution |
| | | | ||
Termination benefits | NA | | NA | |||
Total |
| | | |
Share-Based Payment for Executive Board Members
| 2025 | 2024 | | 2023 | ||
Number of share units granted |
| | | | ||
Total expense in € thousands |
| | | |
The defined benefit obligation (DBO) for pensions to Executive Board members and the annual pension entitlement of the members of the Executive Board on reaching age
Retirement Pension Plan for Executive Board Members
€ thousands | | 2025 | 2024 | | 2023 | |
DBO 12/31 |
| | | | ||
Annual pension entitlement |
| | | |
The total annual compensation of the Supervisory Board members is as follows:
Supervisory Board Compensation
€ thousands | | 2025 | 2024 | 2023 | ||
Total compensation |
| | | | ||
thereof fixed compensation |
| | | | ||
thereof committee remuneration |
| | | |
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The Supervisory Board compensation is a short-term benefit. The Supervisory Board members do not receive any share-based payment for their services. As far as members who are employee representatives on the Supervisory Board receive share-based payment, such compensation is for their services as employees only and is unrelated to their status as members of the Supervisory Board.
Payments to/DBO for Former Executive Board Members
€ thousands | 2025 | 2024 | 2023 | |||
Payments | |
| |
| | |
DBO 12/31 | |
| |
| |
In 2023, SAP granted a loan within the SAP - Flex Loan program for its employees, amounting to €
(G.6) Related-Party Transactions Other Than Board Compensation
Certain Supervisory Board members of SAP SE currently hold, or held within the last year, positions of significant responsibility with other entities. We have relationships with certain of these entities in the ordinary course of business, whereby we buy and sell products, assets, and services on terms believed to be consistent with those negotiated at arm’s length between unrelated parties.
Occasionally, members of the Executive Board of SAP SE obtain services from SAP for which they pay a consideration consistent with those negotiated at arm’s length between unrelated parties.
All amounts related to the abovementioned transactions were immaterial to SAP in all periods presented.
SAP has relationships with joint ventures and associates in the ordinary course of business whereby SAP buys and sells a wide variety of products and services generally on arm’s length terms.
Related-Party Transactions
Companies Controlled by | ||||||||||||||||
Executive Board Members | Supervisory Board Members | Supervisory Board Members | Associated Entities | |||||||||||||
€ millions | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | ||||||||
Products and services provided | | NA | | NA | | NA | | NA | | NA | | | | | | |
Products and services received |
| NA |
| NA |
| | 1 | 1 | NA |
|
| |
| | ||
Sponsoring and other financial support provided |
| NA |
| NA |
| NA |
| NA |
| NA |
|
| NA |
| NA | |
Outstanding balances at year end (Vendors) |
| NA |
| NA |
| NA |
| NA |
| NA |
| NA |
| |
| |
Outstanding balances at year end (Customers) |
| NA |
| NA |
| |
| |
| NA |
| NA |
| |
| |
Commitments at year end |
| NA |
| NA |
| NA |
| NA |
| NA | NA |
| NA |
| NA | |
1 including services from employee representatives on the Supervisory Board in their capacity as employees of SAP
All of these balances are unsecured and interest-free and settlement is expected to occur in cash.
For information about the compensation of our Executive Board and Supervisory Board members, see Note (G.5).
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(G.7) Principal Accountant Fees
At the Annual General Meeting of Shareholders held on May 13, 2025, our shareholders elected BDO AG Wirtschaftsprüfungsgesellschaft (BDO) as SAP’s independent auditor for 2025. BDO has been the Company’s principal auditor since the fiscal year 2023.
BDO and other firms in the global BDO network charged the following fees to SAP for audit and other professional services related to 2025 and previous years:
2025 | 2024 | 2023 | ||||||||||||||||
| BDO AG | | Foreign BDO | | | BDO AG | | Foreign BDO | | | BDO AG | | Foreign | | ||||
€ millions | (Germany) | Firms | Total | (Germany) | Firms | Total | (Germany) | BDO Firms | Total | |||||||||
Audit fees |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Audit-related fees |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Tax fees |
| |
| |
| |
| |
| |
| |
| |
| |
| |
All other fees |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Total |
| |
| |
| |
| |
| |
| |
| |
| |
| |
Audit fees are the aggregate fees charged by BDO for auditing our consolidated financial statements and the statutory financial statements of SAP SE and its subsidiaries. Audit-related fees are fees charged by BDO for assurance and related services that are reasonably related to the performance of the audit and for service organization attestation procedures. The increase in audit-related fees in 2024 was mainly related to attestation services for System and Organization Controls (SOC) reports in the United States, and for the assurance engagement on the Group Sustainability Statement.
(G.8) Events After the Reporting Period
New Share Repurchase Program
Following SAP’s strong free cash flow generation, the Executive Board and the Supervisory Board authorized a new share repurchase program with a volume of up to €
(G.9) Scope of Consolidation, Subsidiaries and Other Equity Investments
Entities Consolidated in the Financial Statements
| Total | |
12/31/2023 |
| |
Additions |
| |
Disposals |
| - |
12/31/2024 | | |
Additions | | |
Disposals | - | |
12/31/2025 |
| |
The additions relate to legal entities added in connection with acquisitions and foundations. The disposals are mainly due to mergers, liquidations, and divestitures of legal entities.
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Subsidiaries1
Major Subsidiaries
| | | Profit/Loss | | | Number of | | |||||
Owner- | Total Revenue | (–) After Tax for | Total Equity as | Employees as | ||||||||
Name and Location of Company | ship | in 20252 | 20252 | at 12/31/20252 | at 12/31/20253 | Footnote | ||||||
| % |
| € thousands |
| € thousands |
| € thousands | |||||
Ariba Technologies India Private Limited, Bengaluru, India | | | | | | |||||||
Ariba, Inc., Palo Alto, CA, United States |
| |
| |
| |
| |
| | ||
Concur Holdings (Netherlands) B.V., 's-Hertogenbosch, the Netherlands | | | | | | |||||||
Concur Technologies, Inc., Bellevue, WA, United States |
| |
| |
| |
| |
| | ||
SAP (China) Co., Ltd., Shanghai, China | | | | - | | |||||||
SAP (Schweiz) AG, Biel, Switzerland | | | | | | |||||||
SAP (UK) Limited, Feltham, United Kingdom |
| |
| |
| |
| |
| | 13 | |
SAP America, Inc., Newtown Square, PA, United States |
| |
| |
| - |
| |
| | ||
SAP Argentina S.A., Buenos Aires, Argentina | | | | | | 13 | ||||||
SAP Asia Pte. Ltd., Singapore, Singapore |
| |
| |
| |
| |
| | 13 | |
SAP Australia Pty. Ltd., Sydney, Australia |
| |
| |
| - |
| |
| | ||
SAP Belgium – Systems, Applications and Products S.A., Brussels, Belgium | | | | | | |||||||
SAP Brasil Ltda., São Paulo, Brazil |
| |
| |
| - |
| |
| | 13 | |
SAP Canada Inc., Toronto, Canada |
| |
| |
| |
| |
| | ||
SAP Deutschland SE & Co. KG, Walldorf, Germany |
| |
| |
| |
| |
| | 9 | |
SAP España - Sistemas, Aplicaciones y Productos en la Informática, S.A., Madrid, Spain | | | | | | |||||||
SAP France S.A., Levallois-Perret, France |
| |
| |
| |
| |
| | ||
SAP Hungary Rendszerek, Alkalmazások és Termékek az Adatfeldolgozásban Informatikai Kft., Budapest, Hungary |
| |
| |
| |
| |
| | ||
SAP India Private Limited, Bengaluru, India |
| |
| |
| |
| |
| | ||
SAP Industries, Inc., Newtown Square, PA, United States |
| |
| |
| |
| |
| | ||
SAP Italia Sistemi Applicazioni Prodotti in Data Processing S.p.A., Vimercate, Italy |
| |
| |
| |
| |
| | ||
SAP Japan Co., Ltd., Tokyo, Japan |
| |
| |
| |
| |
| | ||
SAP Labs Bulgaria EOOD, Sofia, Bulgaria | | | | | | |||||||
SAP Labs India Private Limited, Bengaluru, India |
| |
| |
| |
| |
| | ||
SAP Labs, LLC, Palo Alto, CA, United States |
| |
| |
| |
| |
| | ||
SAP México S.A. de C.V., Mexico City, Mexico |
| |
| |
| |
| |
| | 13 | |
SAP National Security Services, Inc., Newtown Square, PA, United States | | | | | | |||||||
SAP Nederland B.V., 's-Hertogenbosch, the Netherlands |
| |
| |
| |
| |
| | ||
SAP Österreich GmbH, Vienna, Austria | | | | | | |||||||
SAP Philippines, Inc., Taguig City, Philippines | | | | | | 13 | ||||||
SAP Service and Support Centre (Ireland) Limited, Dublin, Ireland |
| |
| |
| |
| |
| | ||
SAP Services s.r.o., Prague, Czech Republic | | | | | | 13 | ||||||
SC SAP Romania SRL, Bucharest, Romania | | | | | |
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Other Subsidiaries4
Name and Location of Company | | Ownership | | Footnote |
% | ||||
"SAP Kazakhstan" LLP, Almaty, Kazakhstan |
| | ||
110405, Inc., Newtown Square, PA, United States |
| | ||
Ambin Properties Proprietary Limited, Johannesburg, South Africa |
| | 13 | |
Ariba Czech s.r.o., Prague, Czech Republic |
| | 13 | |
Ariba India Private Limited, Gurugram, India |
| | ||
Ariba International Holdings, Inc., Wilmington, DE, United States |
| | ||
Ariba Technologies Netherlands B.V., 's-Hertogenbosch, the Netherlands |
| | ||
Baiza Capital Designated Activity Company, Dublin, Ireland | | 8 | ||
Baiza Capital Italia s.r.l., Milan, Italy | | 8 | ||
Baiza Capital LLC, Newark, NJ, United States | | 8 | ||
Baiza Capital S.A., Luxembourg, Luxembourg | |
| 8 | |
Business Objects Option, LLC, Wilmington, DE, United States |
| | ||
Business Objects Software Limited, Dublin, Ireland |
| | 13 | |
Callidus Software Inc., San Ramon, CA, United States | | |||
CallidusCloud (India) Private Limited, Hyderabad, India | |
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
CNQR Operations Mexico S. de. R.L. de. C.V., Mexico City, Mexico |
| | ||
Concur (Canada), Inc., Toronto, Canada |
| | ||
Concur (Czech) s.r.o., Prague, Czech Republic | | 13 | ||
Concur (France) S.A.S., Levallois-Perret, France |
| | ||
Concur (Germany) GmbH, Frankfurt am Main, Germany |
| | 10, 11 | |
Concur (Japan) Ltd., Tokyo, Japan |
| | ||
Concur (Philippines) Inc., Makati City, Philippines |
| | ||
Concur (Switzerland) GmbH, Zurich, Switzerland |
| | ||
Concur Technologies (Australia) Pty. Ltd., Sydney, Australia |
| | ||
Concur Technologies (Hong Kong) Limited, Hong Kong, China |
| | ||
Concur Technologies (India) Private Limited, Bengaluru, India |
| | ||
Concur Technologies (Singapore) Pte. Ltd., Singapore, Singapore |
| | 13 | |
Concur Technologies (UK) Limited, Feltham, United Kingdom |
| | 13 | |
ConTgo Limited, Feltham, United Kingdom |
| | ||
Delos Cloud GmbH, Walldorf, Germany | | |||
Emarsys eMarketing Systems GmbH, Vienna, Austria | | 13 | ||
Emarsys İletişim Sistemleri Tic. Ltd Şti., Istanbul, Turkey | | |||
Emarsys Interactive Services GmbH, Berlin, Germany | | |||
Emarsys Limited, Hong Kong, China | | |||
Emarsys North America, Inc., Indianapolis, IN, United States | | |||
Emarsys Pte. Ltd., Singapore, Singapore | | |||
Emarsys Pty. Ltd., Sydney, Australia | | |||
Emarsys S.A.S., Levallois-Perret, France | | 13 | ||
Emarsys Schweiz GmbH, Zurich, Switzerland | | |||
Emarsys UK Ltd, London, United Kingdom | | 13 | ||
EMARSYS-Technologies Informatikai Szolgáltató Kft., Budapest, Hungary | |
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
FreeMarkets Ltda., São Paulo, Brazil |
| | | |
LeadFormix, Inc., San Ramon, CA, United States | | |||
LeanIX UK Limited, London, United Kingdom | | |||
LLC “SAP Labs“, Moscow, Russia |
| | | |
LLC “SAP Ukraine”, Kyiv, Ukraine |
| | 13 | |
Loyalsys Technologies Israel Ltd., Tel Aviv - Yafo, Israel |
| | ||
LXTECH India Private Limited, Hyderabad, India | | |||
Outerjoin, Inc., San Ramon, CA, United States | | |||
OutlookSoft Deutschland GmbH, Walldorf, Germany |
| | 10, 11 | |
PT SAP Indonesia, Jakarta, Indonesia |
| | | |
Quadrem Africa Pty. Ltd., Johannesburg, South Africa |
| | | |
Quadrem Brazil Ltda., Rio de Janeiro, Brazil |
| | | |
Quadrem Chile Ltda., Santiago de Chile, Chile |
| | | |
Quadrem International Ltd., Hamilton, Bermuda |
| | |
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
Quadrem Netherlands B.V., 's-Hertogenbosch, the Netherlands | | |||
Quadrem Overseas Cooperatief U.A., 's-Hertogenbosch, the Netherlands | | |||
Quadrem Peru S.A.C., Lima, Peru | | |||
SAP (Beijing) Software System Co., Ltd., Beijing, China |
| | ||
SAP (China) Holding Co., Ltd., Beijing, China | | |||
SAP Andina y del Caribe C.A., Caracas, Venezuela |
| | 13 | |
SAP AZ LLC, Baku, Azerbaijan |
| | ||
SAP Beteiligungs GmbH, Walldorf, Germany |
| | | |
SAP Bulgaria EOOD, Sofia, Bulgaria |
| | | |
SAP Chile Limitada, Santiago de Chile, Chile |
| | 13 | |
SAP CIS, LLC, Moscow, Russia |
| | | |
SAP Colombia S.A.S., Bogotá, D.C., Colombia |
| | 13 | |
SAP Costa Rica, S.A., San José, Costa Rica |
| | 13 | |
SAP ČR, spol. s r.o., Prague, Czech Republic |
| | | |
SAP Cyprus Limited, Strovolos, Cyprus |
| | | |
SAP Danmark A/S, Copenhagen, Denmark |
| | | |
SAP Dritte Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany |
| | | |
SAP društvo s ograničenom odgovornošću za digitalnu ekonomiju novog tisućljeća, Zagreb, Croatia | | |||
SAP East Africa Limited, Nairobi, Kenya |
| | 13 | |
SAP Egypt LLC, Cairo, Egypt |
| | 13 | |
SAP EMEA Inside Sales S.L., Madrid, Spain |
| | |
F-102
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
SAP Erste Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany |
| | 10, 11 | |
SAP Estonia OÜ, Tallinn, Estonia |
| | | |
SAP Financial, Inc., Toronto, Canada |
| | | |
SAP Finland Oy, Espoo, Finland |
| | | |
SAP Foreign Holdings GmbH, Walldorf, Germany |
| | | |
SAP France Holding S.A., Levallois-Perret, France |
| | | |
SAP Global Marketing, Inc., New York, NY, United States |
| | | |
SAP Hellas Single Member S.A., Athens, Greece |
| | | |
SAP Hong Kong Co., Ltd., Hong Kong, China |
| | 13 | |
SAP Hosting Beteiligungs GmbH, St. Leon-Rot, Germany |
| | 10, 11 | |
SAP India (Holding) Pte. Ltd., Singapore, Singapore |
| | | |
SAP International Panama, S.A., Panama City, Panama |
| | | |
SAP International, Inc., Miami, FL, United States |
| | | |
SAP Investments, Inc., Wilmington, DE, United States |
| | | |
SAP Ireland Limited, Dublin, Ireland |
| | ||
SAP Ireland US - Financial Services Designated Activity Company, Dublin, Ireland |
| | | |
SAP Israel Ltd., Ra’anana, Israel |
| | 13 | |
SAP Korea Ltd., Seoul, South Korea |
| | | |
SAP Labs France S.A.S., Mougins, France |
| | | |
SAP Labs Israel Ltd., Ra’anana, Israel |
| | | |
SAP Labs Korea, Inc., Seoul, South Korea |
| | | |
SAP Latvia SIA, Riga, Latvia |
| | | |
SAP Lietuva UAB, Vilnius, Lithuania | | |||
SAP Malaysia Sdn. Bhd., Kuala Lumpur, Malaysia |
| | |
F-103
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
SAP Middle East and Africa North Regional Headquarter Company, Riyadh, Kingdom of Saudi Arabia | | |||
SAP Middle East and North Africa L.L.C., Dubai, United Arab Emirates |
| | 13 | |
SAP Middle East FZ-LLC, Dubai, United Arab Emirates |
| | 13 | |
SAP New Zealand Limited, Auckland, New Zealand |
| | | |
SAP Norge AS, Oslo, Norway |
| | | |
SAP North West Africa Ltd, Casablanca, Morocco |
| | 13 | |
SAP Perú S.A.C., Lima, Peru |
| | 13 | |
SAP Polska Sp. z o.o., Warsaw, Poland |
| | | |
SAP Portals Israel Ltd., Ra’anana, Israel |
| | | |
SAP Portugal – Sistemas, Aplicações e Produtos Informáticos, Sociedade Unipessoal, Lda., Porto Salvo, Portugal |
| | | |
SAP Projektverwaltungs- und Beteiligungs GmbH, Walldorf, Germany |
| | ||
SAP Public Services, Inc., Washington, DC, United States |
| | | |
SAP Puerto Rico GmbH, Walldorf, Germany |
| | 10, 11, 13 | |
SAP Retail Solutions Beteiligungsgesellschaft GmbH, Walldorf, Germany |
| | | |
SAP Saudi Software Services Ltd., Riyadh, Kingdom of Saudi Arabia |
| | | |
SAP Saudi Software Trading Ltd., Riyadh, Kingdom of Saudi Arabia |
| | 13 |
F-104
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
SAP Sechste Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany | | 10, 11 | ||
SAP Siebte Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany |
| | 10, 11 | |
SAP sistemi, aplikacije in produkti za obdelavo podatkov d.o.o., Ljubljana, Slovenia |
| | | |
SAP Slovensko s.r.o., Bratislava, Slovakia |
| | | |
SAP Software and Services WLL, Doha, Qatar |
| | 6 | |
SAP Svenska Aktiebolag, Stockholm, Sweden |
| | ||
SAP System Application and Products Asia Myanmar Limited, Yangon, Myanmar | | |||
SAP Systems, Applications and Products in Data Processing (Thailand) Ltd., Bangkok, Thailand |
| | | |
SAP Taiwan Co., Ltd., Taipei, Taiwan |
| | ||
SAP Technologies Inc., Palo Alto, CA, United States |
| | ||
SAP Training and Development Institute FZCO, Dubai, United Arab Emirates |
| | ||
SAP Türkiye Yazilim Üretim ve Ticaret A.Ş., Istanbul, Turkey |
| | | |
SAP Ventures Investment GmbH, Walldorf, Germany |
| | 10, 11 | |
SAP Vierte Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany |
| | | |
SAP Vietnam Company Limited, Ho Chi Minh City, Vietnam | | |||
SAP West Balkans d.o.o., Belgrade, Serbia |
| | | |
SAP Zweite Beteiligungs- und Vermögensverwaltungs GmbH, Walldorf, Germany |
| | 10,11 | |
SAP.io Fund, L.P., Austin, TX, United States | | 7 | ||
Sapphire Fund Investments II Holdings, LLC, Austin, TX, United States | | 7 | ||
Sapphire Fund Investments II, L.P., Austin, TX, United States | | 7 | ||
Sapphire Fund Investments III Holdings, LLC, Austin, TX, United States | | 7 | ||
Sapphire Fund Investments III, L.P., Austin, TX, United States | | 7 | ||
Sapphire SAP HANA Fund of Funds, L.P., Austin, TX, United States |
| | 7 | |
Sapphire Ventures Fund I, L.P., Austin, TX, United States |
| | 7 | |
Sapphire Ventures Fund II, L.P., Austin, TX, United States |
| | 7 | |
Sapphire Ventures Fund III, L.P., Austin, TX, United States | | 7 | ||
Sapphire Ventures Fund IV, L.P., Austin, TX, United States | | 7 | ||
Sapphire Ventures Fund V, L.P., Austin, TX, United States | | 7 | ||
Sapphire Ventures Fund VI Holdings, LLC, Austin, TX, United States | | 5,7 | ||
Sapphire Ventures Fund VI, L.P., Austin, TX, United States | | 7 | ||
Sapphire Ventures Fund VII-A, L.P., Austin, TX, United States | | 7 | ||
Shanghai SAP Cloud Technology Company, Ltd., Shanghai, China |
| | ||
SmartRecruiters Australia Pty Ltd, Sydney, Australia | | 5 | ||
SmartRecruiters GmbH, Walldorf, Germany | | 5 | ||
SmartRecruiters Inc., San Francisco, CA, United States | | 5 | ||
SmartRecruiters Ltd., London, United Kingdom | | 5,13 | ||
SmartRecruiters Sarl., La Garenne Colombes, France |
| | 5 | |
SuccessFactors (Philippines), Inc., Pasig City, Philippines |
| | 13 |
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Name and Location of Company | | Ownership | | Footnote |
% | ||||
SuccessFactors, Inc., Newtown Square, PA, United States | | |||
Sybase Angola, LDA, Luanda, Angola |
| | ||
Sybase, Inc., San Ramon, CA, United States |
| | | |
Systems Applications Products (Africa Region) Proprietary Limited, Johannesburg, South Africa |
| | | |
Systems Applications Products (Africa) Proprietary Limited, Johannesburg, South Africa |
| | | |
Systems Applications Products (South Africa) Proprietary Limited, Johannesburg, South Africa |
| | 13 | |
Systems Applications Products Nigeria Limited, Victoria Island, Nigeria |
| | 13 | |
Taulia (Shanghai) Smart Technology Co. Ltd., Shanghai, China | | |||
Taulia Arabia LLC, Riyadh, Kingdom of Saudi Arabia | | |||
Taulia Australia Pty. Ltd., Sydney, Australia | | |||
Taulia Bulgaria EOOD, Sofia, Bulgaria | | |||
Taulia GmbH, Düsseldorf, Germany | | 12 | ||
Taulia LLC, San Francisco, CA, United States | | |||
Taulia Singapore Pte. Ltd., Singapore, Singapore | | |||
Taulia Trade Technology GmbH, Düsseldorf, Germany | | |||
Taulia UK Ltd., London, United Kingdom | | 13 | ||
Tereina Employee Holdings LLC, Palo Alto, CA, United States |
| |
| 5,7 |
Tereina LLC, Palo Alto, CA, United States | | 5 | ||
TRX Technologies India Private Limited, Bengaluru, India | | |||
TRX, Inc., Bellevue, WA, United States | | |||
Volume Integration, Inc., Chantilly, VA, United States | | |||
WalkMe Australia Pty. Ltd., Sydney, Australia | | |||
WalkMe Canada Ltd., Toronto, Canada | | |||
WalkMe Germany GmbH, Frankfurt am Main, Germany | | 12 | ||
WalkMe K.K., Tokyo, Japan | | |||
WalkMe Ltd., Tel Aviv–Yafo, Israel | | |||
WalkMe Singapore Pte. Ltd., Singapore, Singapore | | |||
WalkMe UK Limited, London, United Kingdom | | |||
WalkMe, Inc., San Francisco, CA, United States | |
1 For the classification of the subsidiaries, the following figures are considered: revenues, profit/loss after tax, total equity, and number of employees.
2 These figures are based on our local IFRS financial statements prior to eliminations resulting from consolidation and therefore do not reflect the contribution of these companies included in the Consolidated Financial Statements. The translation of the equity into Group currency is based on period-end closing exchange rates, and on average exchange rates for revenue and net income/loss.
3 As at December 31, 2025, including managing directors, in FTE.
4 Figures for profit/loss after tax and total equity pursuant to HGB, section 285 and section 313 are not disclosed if they are of minor significance for a fair presentation of the profitability, liquidity, capital resources, and financial position of SAP SE, pursuant to HGB, section 313 (2) sentence 3 no. 4 and section 286 (3) sentence 1 no. 1.
5 Consolidated for the first time in 2025.
6 Agreements with the other shareholders provide that SAP SE fully controls the entity.
7 Structured entity belonging to SAP SE. The results of operations of these entities are included in SAP’s Consolidated Financial Statements in accordance with IFRS 10 (Consolidated Financial Statements).
8 In accordance with IFRS 10, the structured entity does not include the receivables and liabilities resulting from the supply chain financing (SCF) activities.
9 Entity whose personally liable partner is SAP SE.
10 Entity with (profit and) loss transfer agreement.
11 Pursuant to HGB, section 264 (3) or section 264b, the subsidiary is exempt from applying certain legal requirements to their statutory stand-alone financial statements including the requirement to prepare notes to the financial statements and a review of operations, the requirement of independent audit, and the requirement of public disclosure.
12 Pursuant to HGB, section 316 (1), the subsidiary is exempt from having its financial statements audited in respect of its financial year ended December 31, 2025.
13 Entity with support letter issued.
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Other Equity Investments
Name and Location of Company | | Ownership |
% | ||
Joint Arrangements and Investments in Associates | ||
China DataCom Corporation Limited, Guangzhou, China |
| |
Procurement Negócios Eletrônicos S/A, Rio de Janeiro, Brazil | | |
SAP Fioneer GmbH, Walldorf, Germany |
| |
Name and Location of Company | |
Equity Investments with Ownership of at Least 5% | |
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F-108
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F-109
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F-110
FAQ
How did SAP (SAP) perform financially in 2025?
What were SAP’s 2025 cloud and software revenues?
How much free cash flow did SAP generate in 2025?
What dividend is SAP proposing for the 2025 financial year?
Which non-IFRS financial measures does SAP emphasize?
What key risks does SAP highlight in its 2025 20-F filing?
How many SAP ordinary shares were outstanding at the end of 2025?
