By Mauro Orru

SAP is scheduled to report results for the first quarter on Thursday. Here is what you need to know:

REVENUE FORECAST: The German business-software group should post total revenue of 9.53 billion euros ($11.21 billion), according to a non-IFRS consensus provided by the company. The forecast represents 6% growth on year. Analysts expect cloud revenue to be up 18% to 5.87 billion euros, according to the consensus.

SAP analysts and investors tend to follow non-IFRS numbers, which exclude restructuring expenses as well as acquisition-related charges and aren't based on International Financial Reporting Standards.

OPERATING-PROFIT FORECAST: The company behind the Concur travel and expense-management platform is expected to report 11% growth in operating profit to 2.71 billion euros, generating a 28.5% operating margin.

SAP shares have fallen nearly 30% since the year began. Software stocks have taken a beating in recent months after advancements in artificial intelligence raised fears among investors that the technology could replace the services for which software-as-a-service companies like SAP charge clients.

WHAT TO WATCH:

-- MIDDLE EAST TENSIONS: Geopolitical uncertainty creates near-term uncertainty for SAP orders, Jefferies analysts wrote in a note to clients. They point out that oil-and-gas business and those that feed into the energy industry might be focusing more on making their supply chains more resilient right now than signing software deals.

-- CLOUD DEMAND: SAP's current cloud backlog--a closely watched measure of sales that SAP expects to recognize over the coming year based on existing contracts--is likely to range between 24% and 25%, Jefferies analysts said.

Citi analysts estimate SAP's current cloud backlog to come in at about 24% compared with 25% in the fourth quarter. "We acknowledge SAP's resilience credentials, still the group is not immune to macro uncertainty as we saw in bookings deceleration post liberation day," they said.

SAP is relatively insulated from the direct impact of tariffs or geopolitical tensions since it generates revenue from cloud and software services, and not hardware like many tech companies. However, the group is still vulnerable to economic uncertainty that might prompt some clients across sectors to review their spending plans.

Write to Mauro Orru at mauro.orru@wsj.com

(END) Dow Jones Newswires

April 20, 2026 12:38 ET (16:38 GMT)

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