SAP’s Pre-Earnings Moves: A Robot Alliance and a Cloud Reality Check

Ahead of its first-quarter results, SAP SE is navigating a stark disconnect between strategic ambition and market sentiment. The software giant’s stock, trading around €151, has shed roughly a quarter of its value since the start of the year and languishes nearly 45% below its 52-week high from June 2025. With the share price hovering just 9% above its April low of €139, Thursday’s earnings report is a critical test of confidence.

In a notable pre-earnings announcement, SAP revealed a pilot project with Accenture and Vodafone Procure Connect focused on integrating humanoid robots and Physical AI directly with its cloud solutions. The strategic aim is to automate logistics processes by linking them with real-time ERP data, potentially creating significant supply chain efficiencies. This move signals SAP’s push beyond traditional software, though its immediate financial impact remains uncertain.

Analyst consensus, drawn from 17 estimates, sets a high bar for the quarterly figures. For Q1 2026, the average forecast calls for earnings per share of €1.64, up from €1.52 a year earlier. Revenue is expected to reach €9.56 billion, representing year-over-year growth of just over six percent. The market’s focus, however, will extend far beyond these headline numbers.

Three key metrics will dictate the market’s reaction. Foremost is the pace of cloud revenue growth, which includes demand for AI-powered services. Secondly, investors will scrutinize concrete progress on the company’s ongoing restructuring program. The third and most critical indicator will be the “Current Cloud Backlog,” the value of contractually secured but not yet recognized cloud revenue, viewed as the most reliable leading indicator for future sales stability.

Management maintains its full-year 2026 guidance, targeting cloud revenues between €25.8 and €26.2 billion, representing currency-adjusted growth of 23% to 25%. The operating profit forecast stands at €11.9 to €12.3 billion. For the full year, analysts on average project earnings of €7.28 per share, a 16% increase over 2025.

Should investors sell immediately? Or is it worth buying SAP?

This optimistic long-term outlook contrasts with near-term concerns highlighted by analysts like those at JPMorgan. The bank recently reaffirmed its “Neutral” rating with a €175 price target, citing “short-term pain” from the ongoing costs of transitioning to a cloud subscription model. The stock’s current level is well below its 200-day moving average, which sits above €200.

Concurrently, SAP continues to advance its product roadmap and M&A strategy. The company recently released the 1H-2026 update for its SuccessFactors suite, featuring over 400 innovations that expand AI agent capabilities in recruiting, payroll, and talent management, with general availability slated for May 15. Furthermore, the planned acquisition of master-data-management software provider Reltio Inc. is expected to close in the second or third quarter of 2026, pending regulatory approvals. Reltio’s technology is designed to help SAP customers prepare data for AI applications, including information from third-party systems.

Separate from the earnings, shareholders will vote on a proposed dividend of €2.50 per share for fiscal 2025 at the Annual General Meeting on May 5.

CEO Christian Klein and CFO Dominik Asam will host an analyst conference on Thursday to detail the Q1 performance. With the stock under significant pressure, their commentary on the duration of transformation costs and the tangible benefits of initiatives like the AI and robotics pilot will be under intense scrutiny. Beating expectations could stabilize the share price, while a miss risks refocusing attention on the recent lows.