SAP Stakes €1 Billion on Structured Data as Cloud Migration Deadline Looms

SAP launches its most aggressive AI strategy yet with Joule assistants and Tabular Foundation Models, but shares remain under pressure despite 27% cloud revenue growth.

SAP used its Sapphire conference in Orlando to unveil the most aggressive artificial intelligence push in its history, yet the message from the Frankfurt exchange remains stark: the stock is trading within a whisker of its 52-week low. The software giant is betting heavily that proprietary data models — not flashy chatbots — will convince investors its cloud transformation is finally gaining traction.

More than 50 Joule assistant agents and over 200 specialized AI agents are being woven into the new SAP Autonomous Suite. The aim is to handle complex workflows across accounting, procurement, and human resources without human intervention. The in-house digital assistant Joule has been rebuilt from the ground up, while a fresh partnership with Anthropic brings the Claude language model into the ecosystem to power agents in HR, supply chain, and procurement.

The most capital-intensive part of the strategy targets the very nature of enterprise data. SAP is sinking over €1 billion into Tabular Foundation Models via its investment in Prior Labs, developing a model called SAP-RPT-1.5 that is designed to outperform large language models on structured, tabular corporate datasets. The logic is simple: enterprise software runs on rows and columns, not on polished text replies. To feed those models, SAP is integrating Reltio to merge SAP and non-SAP data, and working with Dremio to transform its Business Data Cloud into an Iceberg-native lakehouse.

The platform layer is being consolidated under a single SAP Business AI Platform, bringing together the Business Technology Platform, the Business Data Cloud, and Business AI. Joule Studio 2.0 is scheduled for June 2026, and an AI Agent Hub for centralized management of both proprietary and third-party agent solutions is expected to go live in the third quarter. An eight-figure partner fund has also been established.

Alongside Anthropic, Amazon Web Services is deepening its ties through a zero-copy integration between SAP Business Data Cloud and Amazon Athena. Google Cloud and Microsoft are working on agent interoperability with external frameworks. An open-source AI standards alliance that includes IBM and Adobe rounds out the partnership landscape.

The cloud business, meanwhile, is delivering the fundamental support for the narrative. Cloud revenue grew 27% on a currency-adjusted basis, and the order backlog has swelled to roughly €22 billion. Management has set a full-year cloud revenue target of €25.8 billion to €26.2 billion at constant currencies. A hard deadline is also working in SAP’s favor: the end of support for legacy systems in 2027 is forcing longtime customers to accelerate their migration to the cloud, a process the company claims its new migration tools can shrink by more than 35%.

Despite these tailwinds, the share price tells a different story. The stock closed Friday at €145.84, up 3.24% on the day, but that bounce does little to mask a year-to-date decline of 27.8%. The equity is barely above its 52-week trough and remains well below its long-term average.

Analyst opinions are split on whether the technology overhaul will lift the valuation. Wells Fargo maintains a buy rating with a €250 price target, Jefferies sees fair value at €230, and Bank of America pencils in €210. The DZ Bank is more cautious, warning that the new AI features currently serve mainly to deepen client stickiness rather than generate immediate revenue spikes. SAP is leaning on a €10 billion share buyback program to provide additional support; a quarter of that authorization has already been deployed in the market.

In the near term, macroeconomic signals will dominate sentiment. Nvidia’s upcoming quarterly report is widely seen as a barometer of corporate willingness to invest in AI infrastructure. A strong forecast from the chipmaker could lift beaten-down software names like SAP. Earnings from Walmart and Analog Devices will also offer clues about broader industrial spending appetite. For SAP, the real test will come over the summer, when the first product milestones from its data- and agent-heavy strategy start to arrive.