SAP’s AI Bet Gets a $700 Billion Tailwind, But the Stock Still Needs to Prove Itself

The scale of anticipated capital expenditure on artificial intelligence is staggering. Foxconn now forecasts that global cloud providers will pour $700 billion into AI infrastructure by 2026, a figure that sent a wave of optimism through the technology sector on Friday. SAP rode that wave, with its shares climbing 3.36% to €156.18, joining a broad rally that lifted Salesforce 9.08%, Oracle 8.99%, and ServiceNow 13.46%. The move pushed SAP to the top of the STOXX 50, but the stock’s trajectory remains a study in contrasts.

On the surface, the weekly gain of 2.68% and a monthly advance of 6.86% suggest the worst may be over. Yet the longer-term picture tells a harsher story: the stock has lost 22.68% since the start of the year and 40.20% over the past twelve months. At Friday’s close, SAP still trades 42.50% below its previous-year high, while the 52-week high of €271.60 underscores just how far it has fallen. The current price sits 13.22% above the 12-month low of €137.62 reached in May, offering only modest comfort.

That backdrop makes the contrast with Salesforce particularly telling. The US rival beat earnings expectations handily — adjusted profit of $3.88 per share on revenue of $11.13 billion — but a disappointing quarterly outlook triggered a sharp sell-off. The market is increasingly nervous about software business models that depend on user licenses in an era where AI agents can automate tasks once performed by humans. For SAP, that anxiety is both a warning and an opening.

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

SAP is trying to position itself not as a victim of the disruption but as an enabler of it. At its Sapphire conference in Orlando, the company unveiled the “Autonomous Enterprise” initiative, built around a unified SAP Business AI Platform. The pitch is straightforward: rather than bolting AI onto individual functions, SAP wants to embed autonomous agents deep into core business processes — finance, supply chains, procurement, human resources, and customer experience. To that end, it introduced the Autonomous Suite, which connects more than 50 domain-specific Joule assistants and over 200 specialized agents. New partnerships with Anthropic, Amazon Web Services, Google Cloud, Microsoft, NVIDIA, and Palantir underscore the breadth of the ambition.

The numbers for the first quarter provide at least some operational grounding. SAP reported earnings of €1.66 per share, up from €1.52 a year earlier, on revenue of €9.56 billion — a year-over-year increase of 6.01%. That performance keeps the company from facing the same immediate pressure as Salesforce, but the challenge now is to convert the AI narrative into measurable growth contributions. Analyst sentiment remains broadly constructive: the average price target stands at €214.81, with a range from €154.99 to €290, and not a single sell recommendation among the 23 analysts covering the stock.

Still, technical indicators suggest caution. The relative strength index has climbed to 78.2, signalling overbought conditions after the recent run. The next major catalyst will be the second-quarter results, expected on 23 July 2026. By then, investors will want to see concrete signs that the cloud momentum, margin quality, and early commercial traction of the AI agents presented at Sapphire are translating into earnings. Until then, the grand vision of an autonomous enterprise has the tailwind of historic industry spending — but it must deliver results in a stock that has shed 40% of its value in a year.

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