SAP SE's Upcoming Q2 2024 Earnings Release: Expected EPS Growth and Revenue Uptick

SAP SE is set to release Q2 2024 earnings on July 22nd. The consensus forecasts EPS to reach $1.08, a significant 74.2% increase YoY, and revenue at $8.99 billion, a 19.1% rise YoY. Over the past two years, SAP has met or exceeded EPS estimates half the time and revenue expectations 88% of the time. In the last three months, there have been four upward EPS revisions and two downward adjustments, alongside eight upward and two downward revisions to revenue estimates.

SAP SE (SAP), the leading provider of enterprise software, is set to report its second-quarter 2024 earnings on July 22 [1]. With consensus forecasts pointing to significant year-over-year (YoY) growth, the anticipation surrounding SAP's results is high.

According to the Zacks Consensus Estimate, SAP is projected to report earnings per share (EPS) of $1.08 [1], representing a considerable 74.2% increase YoY. Similarly, the consensus revenue forecast stands at $8.99 billion, a robust 19.1% rise YoY. Over the past two years, SAP has demonstrated a mixed record in meeting these expectations, exceeding EPS estimates half the time and revenue expectations 88% of the time [1].

The recent trend in EPS and revenue revisions provides insight into the positive sentiment surrounding SAP. Over the past three months, there have been four upward EPS revisions and two downward adjustments, alongside eight upward and two downward revisions to revenue estimates [1].

Several factors are expected to contribute to SAP's strong performance in the upcoming quarter. First, the company's cloud business, a key driver of growth, has shown significant momentum. In the previous quarter, SAP reported a 27% increase in its cloud backlog, indicating a successful go-to-market strategy for its cloud offerings [1]. Furthermore, the rapid adoption of Rise with SAP, a solution that helps companies transform their business processes, has gained significant traction. In the second quarter of 2024, Rise with SAP was selected by several prominent companies, including SKF, Mahle Group, RHI Magnesita, and Roca Group [1].

Moreover, the business technology platform, particularly S/4HANA solutions, is expected to continue gaining momentum as more companies adopt cloud-based ERP systems. However, challenges persist for SAP, including continued softness in the Software license and support business segment and global macroeconomic weakness and geopolitical instability [1].

In summary, SAP SE's Q2 2024 earnings preview suggests a strong performance driven by growth in its cloud business and the growing adoption of S/4HANA solutions. However, challenges such as softness in the Software license and support business segment and macroeconomic uncertainties remain.

References:
[1] https://finance.yahoo.com/news/sap-set-report-q2-earnings-133800717.html