SAP reported a 19% increase in its cloud revenue for the fourth quarter of 2025 (Q4 2025) to €5.61bn ($6.69bn), compared to €4.71bn ($5.61bn) in the same period of last year. This growth contributed to a total revenue increase of 3% for the reported quarter ended 31 December, reaching €9.68bn, compared to €9.37bn in Q4 2024. SAP’s net income for Q4 2025 rose by 17% to €1.89bn, up from €1.61bn in the same period the previous year. For the full year, SAP's financial performance showed a significant incre ...

Core Insights - SAP SE reported strong financial results for Q4 and FY2025, highlighting significant growth in cloud services and overall revenue [1][5][17] Financial Performance - Q4 2025 total revenue increased by 3% to €9.68 billion, with a 9% increase at constant currencies [4][11] - Full year 2025 total revenue rose by 8% to €36.80 billion, with an 11% increase at constant currencies [7][17] - Cloud revenue for Q4 grew by 19% to €5.61 billion, and for the full year, it increased by 23% to €21.02 billion [11][17] - The Cloud ERP Suite revenue in Q4 was up 23% to €4.86 billion, and for the full year, it rose by 28% to €18.12 billion [11][17] - Operating profit for Q4 increased by 27% to €2.55 billion, while for the full year, it surged by 111% to €9.83 billion [13][18] - Free cash flow for Q4 was €1.03 billion, a significant recovery from a loss in the previous year, and for the full year, it increased by 95% to €8.24 billion [15][20] Cloud Backlog and Growth - Total cloud backlog reached €77.29 billion, up 22% year-over-year, and 30% at constant currencies [5][32] - Current cloud backlog grew by 16% to €21.05 billion in Q4, with a 25% increase at constant currencies [10][32] Shareholder Returns - SAP announced a new share repurchase program of up to €10 billion, set to begin in February 2026 [23][24] Customer Engagement and Market Position - SAP's "RISE with SAP" initiative continues to attract global customers, driving significant business transformations [25][26] - The company reported strong cloud revenue performance across various regions, particularly in APJ and EMEA [28][29] Non-Financial Performance - Customer NPS decreased by 3 points to 9, primarily due to lower scores from on-premise customers [21] - Employee Engagement Index increased to 76%, and total carbon emissions decreased to 6.3 Mt [22]

AI Adoption & Strategy - Unifor observes deep AI adoption in specific industries and use cases, despite industry reports suggesting potential failures of AI agents [2] - Unifor focuses on "fit-for-purpose AI" and "business AI," aiming to deliver productivity and automation to businesses, contrasting with the "super intelligence" pursuit of companies like OpenAI and Grock [5] - Unifor's acquisitions of RBI and Autonomate are aimed at accelerating AI innovation, particularly in Agentic AI, to benefit its customers [3] Talent Acquisition & Competition - The AI talent pool is scarce and mission-driven, with researchers choosing between pursuing "super intelligence" or delivering real business applications [7][9] - Unifor attracts AI talent by offering the opportunity to deliver automation solutions to over 2,000 businesses, including Fortune 500 companies, emphasizing real-world impact [7][10] - Unifor competes with larger tech companies for talent by focusing on the mission-driven aspect of AI research, rather than solely on compensation [9][10] Future Outlook & IPO - Unifor aims to increase its customer base from 2,000 to 4,000 and then to 8,000, believing this growth will naturally lead to a potential IPO [14] - Unifor will consider going public when the timing and market conditions are favorable [14] - The company views the opening up of public markets for tech IPOs positively, noting anticipation for mega IPOs from companies like Data Bricks, Canva, and Stripe [13] Measuring AI Success - Unifor suggests that the success of AI in business can be measured by increased productivity, potentially leading to more long weekends for workers [11]

Core Insights - SAP SE will participate in two upcoming events featuring CFO Dominik Asam, including the Goldman Sachs Communacopia + Technology Conference and the Jefferies Structural Winners Series [1][2] Group 1: Event Participation - SAP executives will hold a Fireside Chat at the Goldman Sachs Communacopia + Technology Conference on September 9, 2025, from 5:50 pm to 6:25 pm CEST [1] - A second Fireside Chat will take place at the Jefferies Structural Winners Series on September 16, 2025, from 5:00 pm to 5:45 pm CEST [2] Group 2: Company Overview - SAP is a global leader in enterprise applications and business AI, with over 50 years of experience in uniting business-critical operations across various functions such as finance, procurement, HR, supply chain, and customer experience [3]

Financial Data and Key Metrics Changes - Total revenues for Q4 were $1,310,000,000, with organic year-over-year growth excluding AMC, IP rights, and DXC [9] - For the full fiscal year 2025, total revenues were $5,170,000,000, down 3% excluding AMC and approximately 1% excluding IP rights and DXC [10] - Adjusted EBITDA for Q4 was $444,000,000, representing a 34% margin, significantly up excluding AMC [9] - Free cash flow for the year was $687,000,000, exceeding the high end of the target range [13] - Adjusted EPS was $3.82, showing strong growth excluding AMC [13] Business Line Data and Key Metrics Changes - Cloud revenue for Q4 was $475,000,000, reflecting a 2% year-over-year growth [9] - Cloud bookings surged to $238,000,000, marking a 32% year-over-year increase [9] - Cybersecurity accounted for 30% of cloud revenues, with content and Business Network also at 30%, while OSM and DevOps made up 10% each [11] - Content, OSM, and DevOps each grew faster than 10% year-over-year, while cybersecurity experienced a negative growth of 4% [11] Market Data and Key Metrics Changes - Total cloud RPO increased by 13%, with current cloud RPO up 8% and long-term RPO up 17% [12] - Cloud renewal rate stood at 96% at the end of Q4 [12] - The company reported a strong annual recurring revenue of approximately 81% in Q4, up 20 basis points year-over-year [47] Company Strategy and Development Direction - The company aims to expand its competitive advantage through Business AI, Business Clouds, and Business Security, with a focus on delivering total revenue growth through compelling solutions [7] - The medium-term business model targets approaching the "Rule of 40," balancing revenue growth with adjusted EBITDA margin [23] - The company plans to grow its annual dividend by 5% and repurchase $300,000,000 of its stock in fiscal year 2026 [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in fiscal year 2026, projecting total revenue growth of 1% to 2% and cloud revenue growth of 3% to 4% [19] - The geopolitical environment is seen as a driver for customers to invest in sovereign clouds, which is expected to positively impact bookings growth [56] - Management acknowledged challenges in fiscal year 2025 but emphasized a strong outlook for fiscal year 2026, driven by cloud and AI innovations [15] Other Important Information - The company completed a significant divestiture of its mainframe business and executed a large business optimization program [6] - A new $30,000,000 share repurchase program was announced alongside a return to M&A activities [6] Q&A Session Summary Question: What are you seeing from end demand and customer behavior given uncertainties? - Management noted a strong trend towards sovereign cloud and an increase in customer control over deployments, which is seen as a positive driver for growth [56] Question: How much of the maintenance decline is operational, and can pricing be adjusted? - The decline in maintenance is improving due to performance and growth programs, with a focus on core operating metrics showing positive trends [60] Question: What cloud business units are seeing outsized growth? - All cloud business units are experiencing growth, with content, OSM, and DevOps growing faster than 10% year-over-year, while cybersecurity is expected to return to growth [72][73] Question: How much of the fiscal year 2026 growth is visible in RPO? - Current cloud RPO is approximately 60% of revenues, providing strong visibility for the projected growth [76] Question: What conditions would lead to M&A activities? - The company is interested in acquisitions that align strategically and financially, with a focus on cloud and high-growth areas [78] Question: Where is the company investing the most currently? - The company is focusing investments in content, security, and OSM, with an aim to return Business Network to growth [83]

Core Insights - SAP SE reported strong financial results for Q2 2025, highlighting significant growth in cloud revenue and profitability driven by customer demand and AI innovations [2][3][4] Financial Performance - Total revenue for Q2 2025 reached €9.03 billion, an increase of 9% year-over-year, with a 12% increase at constant currencies [5][12] - Cloud revenue grew by 24% to €5.13 billion, with a 28% increase at constant currencies [8][11] - SaaS/PaaS revenue increased by 26% to €5.05 billion, with a 30% increase in Cloud ERP Suite revenue to €4.42 billion [5][11] - IFRS operating profit rose to €2.46 billion, reflecting a growth of over 100% compared to the previous year [14] - Earnings per share (basic) increased by 91% to €1.45 [15] Operational Highlights - The current cloud backlog grew by 22% to €18.1 billion, with a 28% increase at constant currencies [8][11] - Operating cash flow for Q2 was up 71% to €2.58 billion, while free cash flow increased by 83% to €2.36 billion [16] - The share of more predictable revenue increased to 86%, up 2 percentage points from the previous year [12] Strategic Developments - SAP's "RISE with SAP" initiative continues to attract global customers, indicating strong demand for business transformation solutions [19][20] - Partnerships with Accenture and Alibaba Group were announced to enhance cloud transformation efforts [24][25] Outlook - SAP maintains its financial outlook for 2025, expecting cloud revenue to reach €21.6 – 21.9 billion, representing a growth of 26% to 28% at constant currencies [26][27] - The company anticipates a slight deceleration in current cloud backlog growth for 2025 [27]

Core Insights - SAP SE is set to report its second-quarter 2025 results on July 22, with earnings expected at $1.63 per share, reflecting a 38% increase year-over-year, and revenues projected at $10.4 billion, indicating a 16.47% rise from the previous year [1] Financial Performance - SAP has consistently surpassed earnings estimates in the last four quarters, achieving an average earnings beat of 10%. The company's stock has increased by 56.5% over the past year, significantly outperforming the Computers - Software industry, which grew by 21.4% [2] Cloud Transformation and AI Strategy - The ongoing cloud transformation and AI-driven growth strategy are expected to positively impact SAP's second-quarter performance. The company's cloud revenues rose by 27% year-over-year to €4.99 billion in Q1, with Cloud ERP Suite revenues growing by 34%, making up 85% of total cloud revenues [2][9] - SAP is focusing on Business AI as a key growth driver through 2027, with plans to introduce flexible licensing models for easier transitions to cloud-based versions of its business suite [3] - Significant investments in AI are planned for 2025, with over 30,000 developers dedicated to enhancing AI capabilities and aiming to increase user productivity by 30% by year-end [5][9] Generative AI and Productivity Enhancements - SAP is optimistic about the generative AI trend, expecting it to positively influence future revenues. The company has integrated over 1,300 skills into its AI co-pilot Joule, covering 80% of business and analytical transactions by the end of 2024. AI-assisted contract validation has reduced average contract booking time by 75%, while AI-powered quote-to-cash automation has increased productivity tenfold [4] Competitive Positioning - To maintain a competitive edge in the IT services industry, SAP continues to invest in technological innovations, which may increase research and development costs [7]

Core Insights - SAP SE has introduced innovations and partnerships aimed at enhancing business productivity by up to 30 percent through the use of Business AI [1][2] - The generative AI assistant Joule is designed to provide personalized answers and streamline workflows across various applications [2][3] AI Innovations - Joule can assist users throughout their workday, providing real-time insights and anticipating needs while adhering to ethical AI guidelines [3] - A collaboration with Perplexity enhances Joule's capabilities to answer complex business questions using structured and unstructured data [4] - An expanded library of Joule Agents is introduced to optimize business processes across various functions such as customer experience and supply chain management [5] AI Development and Applications - SAP has launched an AI Foundation that serves as an operating system for developing and scaling AI solutions, allowing for quicker creation of effective AI prompts [6] - New intelligent applications in SAP Business Data Cloud are designed to continuously learn and optimize business processes using critical data [7] Strategic Partnerships - SAP is partnering with Palantir to support joint customers in their cloud migration and modernization efforts, facilitating a harmonized data foundation [8] Cloud Solutions - SAP Business Suite packages are introduced to simplify cloud solution adoption for customers, allowing for customization to meet specific business needs [9] - A new solution leveraging Joule aims to accelerate cloud transition, potentially delivering up to 35 percent faster time to value [10]

Core Insights - Microsoft has a strong competitive advantage with its Windows operating system, which is considered attractive despite competition from the Apple ecosystem [1] - The company is characterized by growth in revenue, earnings, and free cash flow, making it appealing for investment [1] - Favorable valuations, high free cash flow margins, and generous share repurchase programs are key investment criteria for Microsoft [1] Company Characteristics - Microsoft is recognized for its excellent growth prospects, which contribute to its attractiveness as an investment [1] - The company has a history of steady growth, which is a preferred trait for investors [1] - Dividend stocks and companies with robust share repurchase programs are highlighted as favorable investment options [1]

Group 1: Netflix, Inc. (NFLX) - Netflix's shares have outperformed the Zacks Broadcast Radio and Television industry over the past year, increasing by 58.1% compared to the industry's 45.8% [4] - The company is benefiting from a growing subscriber base, with about two hours of viewing per member per day, indicating strong member retention [4] - The launch of a first-party ad tech platform in Canada and other countries in 2025 is expected to double ad revenues year-over-year, with raised revenue guidance for 2025 between $43.5 billion and $44.5 billion [5] Group 2: SAP SE (SAP) - SAP's shares have outperformed the Zacks Computer - Software industry over the past year, increasing by 46.4% compared to a decline of 2.9% in the industry [7] - The company is experiencing growth due to rising cloud demand, particularly from its Rise with SAP and Grow with SAP solutions [7] - SAP's revised 2025 outlook expects cloud and software sales in the range of €33.1 billion to €33.6 billion, up from a previous forecast of €29.83 billion [9] Group 3: Shell plc (SHEL) - Shell's shares have declined by 8.1% over the past year, while the Zacks Oil and Gas - Integrated - International industry saw a decline of 12.7% [10] - The company faces challenges in its Renewable segment and has a sub-100% reserve replacement ratio, indicating difficulties in replenishing produced energy [10] - Despite these challenges, Shell remains a global leader in liquefied natural gas, leveraging its strong LNG position to generate consistent earnings [11] Group 4: Preformed Line Products Co. (PLPC) - Preformed Line Products has outperformed the Zacks Electronics - Miscellaneous Products industry over the past year, increasing by 13.8% compared to a decline of 50.3% in the industry [13] - The company has a robust balance sheet with $57.2 million in cash and $56.2 million in free cash flow, supporting liquidity and potential M&A [13] - Global diversification offsets U.S. market weakness, with strong growth in EMEA, Asia-Pacific, and The Americas [14] Group 5: ImmuCell Corp. (ICCC) - ImmuCell shares have outperformed the Zacks Medical - Products industry over the past six months, increasing by 48.7% compared to a decline of 5.7% in the industry [16] - The company is experiencing strong operational recovery, with fourth quarter and full-year 2024 product sales rising by 52% year-over-year [16] - Gross margin improved to 36.5% in the fourth quarter, and EBITDA turned positive at $1.1 million for the year [17]