SAP’s Cloud Backlog Hits €22 Billion, But the Stock Is Stuck in the Doldrums

SAP shares near 52-week low despite 19% cloud revenue growth, as analysts split on outlook and sovereign cloud deals expand in Europe.

SAP’s business is humming along nicely, yet its share price tells a very different story. The German software giant has watched its stock shed more than 28% since the start of the year, with the shares trading at around €145 — uncomfortably close to the 52-week low of €139.12 and a world away from the €271.60 peak seen just 12 months ago. That disconnect between operational performance and market sentiment is about to be tested in a busy May.

A Divided Analyst Camp

The divergence of opinion among analysts is striking. Goldman Sachs has trimmed its price target from €260 to €230, but analyst Mohammed Moawalla maintains a “Buy” rating, pointing to the company’s resilient order book. Barclays is similarly bullish with an “Overweight” and a €220 target. JPMorgan’s Toby Ogg, who rates the stock “Neutral” at €175, described the latest quarterly figures as reassuring but cautioned that growth for the full year is likely to plateau at last year’s level. At the other end of the spectrum, DZ Bank has a “Sell” rating with a target of just €130.

Cloud Momentum Remains Intact

The first quarter provided a solid foundation. Cloud revenue climbed 19%, with the core cloud ERP suite accelerating to 23% growth. The current cloud backlog swelled to €21.9 billion, up 20%, while total revenue reached €9.6 billion. Operating profit under IFRS rose 17%. The only blemish was a €408 million legal settlement with Teradata, which weighed on the bottom line.

Management has held its full-year guidance, targeting cloud revenue of around €26 billion. However, the tone has shifted: the company now expects growth to match last year’s pace rather than accelerate, with a renewed push delayed until 2027.

Sovereign Cloud Push Continues

On the strategic front, SAP is deepening its footprint in regulated cloud markets. On April 27, it announced a partnership with S3NS — the trusted cloud provider jointly operated by Thales and Google Cloud. The SAP RISE Private Cloud Edition will run on S3NS’s SecNumCloud-certified PREMI3NS platform, with commercial availability slated for the second half of 2026. Data will be stored and processed in France under French jurisdiction, giving defence, healthcare and critical infrastructure clients access to SAP’s full AI stack without compromising sovereignty. Thales has already signed on as the first reference customer, migrating its entire SAP ERP landscape — from finance to supply chain — onto the platform.

The S3NS deal follows a similar agreement with Bleu in March, underscoring a broader European sovereign cloud strategy. S3NS is no pilot project: it already runs more than 60 customers and 30 managed services in production.

M&A and Buyback Activity

SAP is also awaiting regulatory clearance for its planned acquisition of Reltio Inc., a master data management specialist. The deal is expected to close in the second or third quarter of 2026 and is designed to bolster SAP’s Business Data Cloud, a cornerstone of its AI strategy.

Meanwhile, the company has been supporting its stock with its own firepower. A multi-billion-euro share buyback programme is underway, with the first tranche of €2.6 billion already completed in April.

A Pivotal May Ahead

The coming weeks offer several potential catalysts. SAP’s annual general meeting takes place in Walldorf on May 5, followed by the Sapphire conference in Orlando, where CEO Christian Klein and his team will lay out their product roadmap. A decisive move above the 50-day moving average of €156.85 would brighten the technical picture considerably. For a stock that has lost nearly a third of its value in four months, the stakes could hardly be higher.