SAP Bets Big on AI With Two Acquisitions as Shareholders Gather for AGM

SAP announces dual acquisitions of Prior Labs and Dremio to embed AI deeper into its core, while shares edge up 2.7% ahead of AGM and dividend vote.

SAP is making a bold double bet on artificial intelligence, announcing the acquisition of two technology firms on the same day that its stock finally found some footing after months of heavy losses. The moves come just ahead of the company’s virtual annual general meeting on Tuesday, where investors will vote on a proposed dividend of €2.50 per share.

The Walldorf-based software giant revealed on May 4 that it plans to buy Prior Labs, a specialist in tabular data AI, and Dremio, a data-lakehouse platform provider. The deals signal a strategic push to embed artificial intelligence deeper into SAP’s core business while taking direct control over the data infrastructure that powers it.

A Billion-Euro Bet on Tabular AI

Prior Labs focuses on what it calls “tabular foundation models” — AI systems that analyze structured data in spreadsheets rather than text, predicting business outcomes such as late payments or customer churn. SAP intends to invest over €1 billion in the unit over the next four years, with plans to build a European AI research lab of global scale. Prior Labs will operate as a standalone entity within SAP, and its technology will be integrated into SAP AI Core and the SAP Business Data Cloud.

The Dremio acquisition addresses a different but equally critical bottleneck. SAP’s chief technology officer Philipp Herzig noted that corporate AI projects often fail not because of the algorithms, but because the underlying data isn’t ready. Dremio’s data-lakehouse platform is designed to unify SAP and non-SAP data on a single open platform, laying the groundwork for what SAP calls “agentic AI.”

Financial terms for both transactions were not disclosed. Both deals remain subject to regulatory approval, with closings expected in the third quarter of 2026 — though the Prior Labs acquisition could close earlier.

Stock Edges Higher, but Recovery Is a Long Way Off

SAP shares gained about 2.7 percent on Monday, closing at €148.26. That marks a modest bounce from recent lows, but the context is sobering: the stock has lost roughly 27 percent since the start of the year and remains far from its 52-week high of €271.60.

The uptick was driven by a combination of factors beyond the acquisition news. The upcoming Sapphire conference in Orlando, where SAP is expected to showcase new AI advances, is providing additional momentum. The company’s current cloud backlog recently rose 20 percent to €21.9 billion, or 25 percent on a currency-adjusted basis, while cloud ERP suite revenues climbed 30 percent in constant currency.

Still, the stock has struggled to hold gains above €150, repeatedly pushing up to that level only to fall back toward €145. Monday’s move could represent another attempt to break that pattern, but convincing AI demonstrations at Sapphire may be needed to restore lasting momentum.

A Bruised Stock Meets a Pivotal Week

Tuesday’s virtual AGM will see shareholders vote on the proposed dividend for fiscal 2025. The ex-dividend date is set for May 6, with payment scheduled for May 8.

The broader DAX landscape remains fractured. While SAP and Rheinmetall — which gained 2.4 percent on a Santander upgrade and a record order backlog of €63.8 billion — are providing bright spots, other heavyweights are struggling. Qiagen crashed nearly 40 percent after slashing its 2026 guidance, while Adidas lost 4.2 percent as US tariffs and currency headwinds weigh on margins.

For SAP, the twin acquisitions represent a clear strategic bet that AI will drive the next phase of enterprise software growth. But with the stock down by more than a quarter this year and the memory of a much higher valuation still fresh, the market is waiting for proof that the strategy will translate into results. The Sapphire conference and the AGM this week will provide the first test.