SAP trims its 2026 profit outlook as AI acquisitions add near-term cost

SAP reported second-quarter adjusted earnings of 1.89 euros per share, well above the 1.68 euros analysts expected, with revenue up 11 percent year over year to 9.88 billion euros and operating profit rising to 4.16 billion euros from 3.54 billion euros a year earlier. The company’s cloud unit, its largest segment, grew sales 24 percent and its cloud backlog jumped 26 percent to 22.9 billion euros, results that helped ease a year of investor anxiety over whether AI coding tools could let companies build their own enterprise software rather than paying for SAP’s platforms, concerns that had contributed to a 40 percent decline in SAP’s stock this year. CEO Christian Klein pushed back directly on that narrative, arguing that generic AI tools cannot match the reliability of SAP’s embedded AI solutions for accurate, compliant outcomes grounded in a company’s actual business data, pointing to strong momentum in its Autonomous Suite and Business AI Platform. Despite the earnings beat, SAP cut its non-adjusted operating profit guidance by 100 million euros, citing the dilutive impact of its recent acquisitions of Dremio and Prior Labs, deals aimed at expanding its tabular AI capabilities, while leaving its cloud revenue targets unchanged. The results illustrate a split emerging among enterprise software vendors this earnings season: rather than being disrupted by AI, established players with deep enterprise data access like SAP are positioning themselves as AI beneficiaries, even as the acquisitions needed to build out that positioning weigh on near-term profitability.