SAP's Counterweight to the AI Arms Race: Record Cloud Backlog Meets a Cautionary Rally
Published on 08/06/2026 at 10:41 | Redaktion boerse-global.de
The contrast could hardly be starker. While Microsoft, Meta, and Oracle have piled up a combined $1.09 trillion in data-center leasing commitments, SAP is preaching a different gospel: that artificial intelligence only creates value when it is embedded in the software enterprises actually run on, not in the sheer scale of computing horsepower behind it.
That message, delivered publicly by CEO Christian Klein, is landing at a moment when the Walldorf-based software giant is posting operational numbers it has rarely matched this year — and when its shares are in the middle of a sharp, if still incomplete, recovery.
A Quarter That Speaks for Itself
The numbers from July 23 tell the story of a company firing on most cylinders. Cloud revenue jumped 22 percent to €6.28 billion in the second quarter — or 24 percent on a currency-adjusted basis. The current cloud backlog, the contractual foundation of future revenue, expanded 27 percent to €22.9 billion. Non-IFRS operating profit rose 7 percent to €2.74 billion.
The one blemish: management trimmed its full-year 2026 outlook for non-IFRS operating profit to a range of €11.8 billion to €12.2 billion, down from the previous €11.9 billion to €12.3 billion. The adjustment, the company said, stems from the effects of recent acquisitions rather than any deterioration in the underlying business.
Klein put his money where his confidence is. The day after the earnings release, he bought 12,122 shares at an average price of €182.10 — a roughly €2.38 million vote of confidence, even if that purchase price now sits above where the stock trades.
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The Buyback Machine Keeps Humming
Alongside the operational momentum, SAP continues to return capital to shareholders. Between July 27 and 31, the company repurchased 2,184,430 of its own shares, totaling €344.3 million in the first interim report on its second 2026 buyback tranche. The program mechanically supports the per-share price by reducing the float, independent of how the business performs.
Analyst reaction to the quarter was broadly constructive, if not uniformly enthusiastic. Jefferies reaffirmed its "Buy" rating with a €210 price target on July 28. A day earlier, JPMorgan held at "Neutral" with a €175 target. Berenberg and UBS rounded out the picture with assessments ranging from "Buy" to "Neutral," producing a target spread of €164 to €210 — a consensus that leans toward moderate undervaluation, with UBS as the cautious outlier.
A Rally With a Temperature Check
The stock's recent climb has been anything but subtle. Since its 30-day low, SAP shares have gained 19 percent. Over the past seven trading sessions alone, the advance stands at 9.71 percent, fueled by the quarterly results and the analyst commentary that followed.
Yet the longer-term picture remains sobering. The stock is still down 18.85 percent since January. And while it closed Wednesday at €170.00, up 0.51 percent, it continues to trade just beneath its 200-day moving average of €173.41 — a level chart watchers often treat as the dividing line between a genuine trend reversal and a mere rebound. At its current price of €172.04, up 1.20 percent on the day, the gap has narrowed to roughly 0.79 percent.
Technical indicators are flashing a mixed signal. The relative strength index sits at 70.4, a classic overbought reading that suggests the recent run may be running on fumes in the short term. The annualized volatility of 48.46 percent underscores a market that has yet to make up its mind.
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The European Data Play
Klein's push for European technological sovereignty — his warning against one-sided dependence on the US and China in AI — is more than rhetoric. On Thursday, the company showcased its "Industry Network for Automotive," built around Catena-X, its data infrastructure for the auto sector. With the "Data Space Accelerator Program" and new certificate management solutions, SAP is positioning AI in the European context as fundamentally a data problem: solve that first, the logic goes, and the investment pays off.
The strategic contrast with Oracle is instructive. The US rival is wrestling with debt at 4.3 times EBITDA and a negative outlook from rating agencies. SAP's answer to the hardware arms race is industrial networks, digital product passports, and product carbon footprint management — applications with direct industrial utility rather than raw compute capacity.
Whether this more measured approach gains further traction depends on whether skepticism toward the billion-dollar US bets on AI infrastructure continues to build. Klein's caution has been heard. Whether it has been priced in is another question entirely. The next clue arrives with the third-quarter report on October 21.
