SAP's Fractured Recovery: Legal Challenges, Margin Pressure, and a Pivotal Quarterly Test
28.06.2026 - 08:06:25 | boerse-global.de
SAP’s stock limped into the weekend with a fragile bounce, closing Friday at €136.16 — nearly 4% above the previous day’s level. The gain, however, masks a brutal reality: the shares stand about 49% below their 52-week peak of €266.00 and have shed roughly 33% since the start of 2026. A technical rebound after hitting a 52-week low of €130.80 is hardly a vote of confidence.
The cloud over the stock is not just about earnings. A significant legal threat has emerged from process-mining rival Celonis, which accuses SAP of deliberately blocking customer data access to favor its own Signavio product. A federal judge in San Francisco has set trial for December 7, 2026, after denying SAP’s motion to dismiss the bulk of the antitrust claims. Celonis now has the green light to demand internal documents on APIs, pricing, partner programs, and RISE contracts. SAP has countered that parts of the lawsuit were thrown out and reiterated its intent to “vigorously defend ourselves.” Separately, the European Commission is reviewing SAP’s concessions — including greater provider flexibility and the removal of certain fees — though the company does not expect material financial repercussions.
On the margin front, analysts are turning more cautious. Goldman Sachs trimmed its second-half 2026 gross margin estimate for SAP to 72.8% from 73.3%, citing higher hardware costs and weakness at a major Middle Eastern customer. Jefferies analyst Charles Brennan slashed his price target from €230 to €210, pointing to sluggish conditions across European software firms. Both houses maintain buy recommendations, but the tone has soured. UBS analyst Michael Briest, also a buyer with a €205 target, cautioned that margin improvements in the second quarter are likely to be less dynamic than in the opening months of the year.
The external environment has compounded the pressure. Accenture’s recent third-quarter revenue and guidance miss — which triggered a 16% plunge in its own stock — infected the European software sector, SAP included. Oracle’s announcement of a $95 billion AI infrastructure plan through 2027 further raises the bar for SAP’s own capital expenditure commitments.
Should investors sell immediately? Or is it worth buying SAP?
Despite the gloom, the underlying business shows resilience. First-quarter cloud revenue rose 27% on a currency-adjusted basis to €5.96 billion, accelerating from the prior quarter. The cloud backlog stood at €21.9 billion, up 20%. For the full year 2026, management targets cloud revenue between €25.8 billion and €26.2 billion, implying growth of 23% to 25%, and non-IFRS operating profit of €11.9 billion to €12.3 billion. Those goals, however, are contingent on de-escalation in the Middle East and the closing of the Reltio acquisition.
SAP’s ongoing share buyback provides a structural floor. The second tranche, running until July 27, has a volume of up to €2.6 billion. So far, the company has repurchased 16.3 million shares at an average price of €161.16 — roughly 18% above current levels — spending about €2.6 billion in the first tranche alone. The entire program totals up to €10 billion. Yet even that bought support has failed to arrest the downtrend.
Now enters the quiet period, which began June 22 and will last until the second-quarter earnings release on July 23. Management is barred from commenting on business developments, leaving the stock hypersensitive to external signals. Investors will scrutinize two metrics above all: cloud backlog and cloud gross margin, both of which will indicate whether SAP’s AI strategy is translating into commercial traction.
SAP at a turning point? This analysis reveals what investors need to know now.
The next few weeks promise minimal noise. The real verdict arrives July 23, when earnings and guidance go on trial simultaneously — and the stock, already near its yearly low, has everything to prove.
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