SAP Stock Sees Biggest Drop Since 2020 Over Cloud Concerns

Shares in German tech giant SAP have reportedly seen their largest one-day loss since 2020.

The decline came as the company rattled investors over the health of its cloud computing business, the Financial Times (FT) reported Thursday (Jan. 29).

This came after the company said growth of its cloud backlog, an important metric to measure future sales contracts, would “slightly decelerate” this year from the 25% reached in 2025, with recent large contracts set to tick up more slowly than anticipated, the FT said.

The report added that SAP also projected cloud revenue growth of 23% to 25% for the year, figures in keeping with analysts’ expectations but down slightly from last year’s 26%. The news caused SAP’s shares to drop more than 16% to their lowest level in almost two years, on pace for their largest one-day decline since October 2020.

CEO Christian Klein tried to downplay the decline, the FT added, saying SAP needed to remain focused on executing its strategy, and not on reacting to short-term changes in share price.

He said software-as-a-service companies were “in the penalty box” as investors questioned their role at a time when AI can perform their applications, but argued that SAP could benefit from integrating AI into business data and processes.

“It always starts with the chips and the hardware, but to create real value for businesses, you have to move up the stack,” Klein said. “These AI agents need to understand business data and processes to deliver value for customers, and we are uniquely positioned to win in business AI.”

As covered here last year, SAP in May debuted several new solutions centered around agentic AI applications for the enterprise, along with applications that can help accelerate cloud adoption by organizations.

“These cloud-based advances are not just about adding AI capabilities but about rethinking how businesses operate at a fundamental level by combining simplicity, flexibility and automation,” PYMNTS wrote at the time.

More recently, SAP introduced a series of artificial intelligence enhancements for retailers, including the Retail Intelligence solution in SAP Business Data Cloud, designed for retailers and direct-to-consumer businesses.

“Retailers face a landscape where AI is no longer optional,” Balaji Balasubramanian, SAP’s chief product officer for customer experience and consumer industries, said in a news release. “SAP provides one closed-loop, AI-enhanced retail operating system that ties planning, execution and engagement together. We put data and AI at the heart of retail, delivering speed, personalization and growth across every channel and segment.”