Christian Klein, CEO of Europe’s AI firm SAP, stated on Thursday that artificial intelligence is the primary reason customers are signing deals with the company. He also revealed that 80-85% of SAP’s revenue for next year is already done after the company closes Q4.
Klein acknowledged that as the company closes the quarter, its customers and investors can expect a positive output from SAP. The firm revealed in its earnings report published late on Wednesday that SAP’s cloud backlog surged by 23% in the third quarter to €18.8 billion.
SAP sees an increase in revenue driven by cloud and AI operations
According to data compiled by LSEG, SAP reported a 7% increase in revenue to €9.08 billion ($10.53 billion), which was lower than the expected €9.15 billion. However, Klein revealed that the firm increased its cloud revenue by 22%, citing a rise in AI and data cloud market share as the reason for the revenue growth.
Deutsche Bank also acknowledged that SAP remains a top pick in the European tech and global software sector. The financial institution added that the AI firm is heading toward the lower end of its forecast for cloud revenue, which is €21.6 billion to €21.9 billion this year.
Deutsche Bank analysts, led by Johannes Schaller, stated in a note that, in their view, SAP continues to execute very well against an environment of continued deal cycles and pushouts. The bank also stated that SAP is performing well despite the delays in deal closings that have resulted in the firm guiding toward the lower end of its cloud revenue growth range for FY25.
“I was very optimistic last night, and I’m still optimistic as the pipeline looks good. We actually now have our biggest quarter.”
–Christian Klein, CEO of SAP.
At the time of publication, SAP shares are down nearly 0.80% to €234.95. However, the firm’s stock price has surged by 2.40% over the last five days and increased by 3.78% in the past month.
SAP was ranked as the most valuable company in Europe in March, following a wave of AI enthusiasm and gains on the German stock market. Bank of America’s analyst earlier that month said SAP, which offers corporate products across cloud solutions, expenses, supply chain management, and analytics, was its top large-cap software pick for 2025.
EU businesses call for AI deregulation
Businesses have expressed concerns about the European Union’s legislative approach to AI, with some calling for deregulation in an effort to catch up with the global AI momentum. Klein expressed his uncertainty about whether the EU is adopting the right strategy compared with the U.S. approach of giving AI initiatives a chance in the industry.
Klein told CNBC’s Europe Early Edition that his goal is to create value for AI firms, arguing that it’s exactly what customers are looking for. The chief executive believes that his stance mirrors the message of other AI firms and investors in Europe.
Klein also highlighted that the U.S. and China are currently dominating the training of large language models, which is the infrastructure needed for AI. He believes that Europe has a chance to be a leader in leveraging AI training.
The tech executive argued that training large language models is now a commodity. He also expects the application of AI will be prioritized for businesses, and SAP’s bet on the issue will be reflected in its share price in the future. Klein said it’s essential to witness real AI adoption in Europe, rather than being swayed by hype.
SAP’s CEO noted that geopolitical tensions have given the firm some exposure to China through partnerships that enable it to operate in the country. Klein acknowledged that Beijing’s speed of AI development, low regulation, and talent pool make it hard to ignore.
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