SAP shares fall after reporting disappointing cloud contract value

German software giant SAP tumbled as much as 11 percent on Thursday after reporting weaker-than-expected growth in its cloud contract backlog in the fourth quarter.

That’s the biggest one-day decline since October 2020, when its shares fell 22% following disappointing third-quarter results. The stock is also on track to close at its lowest price since mid-2024.

Shares were last traded down 9.7%.

SAP’s current cloud backlog increased by 16% to 21.1 billion euros in the fourth quarter [$25.3 billion]. Cloud savings growth will be a “disappointment” compared to previous expectations of 26% growth, UBS analysts said on Thursday.

“Large transformational deals involving high cloud revenue increases in foreign years and terminations under regulatory relief provisions negatively impacted existing cloud backlog growth at constant currency in the fourth quarter by approximately 1 percentage point,” SAP said in its earnings release. he said.

Chief Executive Christian Klein said the current cloud backlog in the final quarter of the year provides a “strong foundation” to accelerate revenue growth through 2027.

However, the German company guided for cloud accumulation growth to “slow down slightly” in 2026.

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