SAP Prepares for Economic Challenges Amid US Trade Policy Shifts, Sees 9% YoY Revenue Growth

SAP reported Q2 2025 revenue of $10.6 billion, up 9% YoY, driven by cloud and cloud ERP suite revenue surges of 24% and 30%, respectively. However, the company's cloud backlog declined slightly QoQ to $21.3 billion. Executives attributed the decline to stricter cost controls and longer deal cycles due to US trade policy shifts. SAP is bracing for economic challenges and focusing on AI adoption to drive transformation.

WALLDORF — SAP SE reported its second-quarter (Q2) 2025 financial results, highlighting a 9% year-over-year (YoY) increase in total revenue to $10.6 billion. The company's cloud and cloud ERP suite revenue surged by 24% and 30%, respectively. However, the company's current cloud backlog declined slightly quarter-over-quarter (QoQ) to $21.3 billion [1].

Christian Klein, SAP's CEO, attributed the decline in cloud backlog to stricter cost controls and longer deal cycles due to recent US trade policy shifts. Despite this, SAP maintains a cautious optimism for the remainder of 2025, focusing on AI adoption to drive transformation and mitigate potential economic challenges [1].

Dominik Asam, SAP's CFO, noted that the company's performance was supported by continued customer demand and disciplined cost control. The company's IFRS operating profit reached €2.5 billion, while non-IFRS operating profit was €2.6 billion, both showing a 32% and 35% increase at constant currencies, respectively [1].

West Pharmaceutical Services Inc (NYSE: WST), a key competitor in the pharmaceutical packaging market, also reported strong Q2 2025 results. The company's net sales increased by 9.2% to $766.5 million, driven by accelerating demand for high-value products and GLP-1-related components. West Pharmaceutical's stock surged over 10% in premarket trading, reflecting investor enthusiasm for the company's performance and improved outlook [2].

SAP shares were down close to 2% in extended trading following the Q2 report. The stock was up nearly 25% for 2025 through Tuesday’s close, demonstrating resilience despite the recent decline in cloud backlog [3].

References:
[1] https://news.sap.com/2025/07/sap-announces-q2-and-hy-2025-results/
[2] https://za.investing.com/news/company-news/west-pharmaceutical-q2-2025-slides-revenue-jumps-92-guidance-raised-on-glp1-strength-93CH-3802354
[3] https://www.investopedia.com/sap-earnings-q2-fy2025-11776634