SAP refuses to budge on renewal discounts despite cloud growth slowdown

SAP is refusing to change tack on renewal discounts despite lower-than-expected cloud forecasts prompting its biggest share price slide in five years.

Amid a tumultuous week for enterprise software vendors' market caps, the European ERP giant saw its value drop 22 percent on January 29 after forecasting a slight fall in the growth of its cloud backlog.

The company met revenue expectations by posting €36.8 billion ($43.1 billion) for calendar 2025, an 8 percent increase on the prior year. Operating profit for Q4 2025 was €2.554 billion, 27 percent higher than the same quarter last year.

However, SAP's current cloud backlog – a measure of how quickly it is converting on-prem customers to a cloud and SaaS model – fell from 2024 to 2025 and was set to "slightly decelerate" further in 2026. Growth would remain around 25 percent, however.

SAP provides core business software for some of ...