SAP SE SAP is scheduled to post results for the first quarter of 2025 on April 22.

The Zacks Consensus Estimate for first-quarter 2025 earnings has moved south 1 cent in the past 60 days and is pegged at $1.38 per share. The consensus mark implies a 56.8% increase from the year-ago reported actuals. The Zacks Consensus Estimate for first-quarter 2025 revenues is currently pegged at $9.68 billion, indicating a 10.87% uptick from the year-ago figure.

SAP's earnings surpassed the Zacks Consensus Estimate in three of the preceding four quarters and missed in the other one, delivering an average beat of 6.38%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Factors Shaping the Upcoming Results for SAP

SAP’s performance is expected to have benefited from steady momentum in its cloud business. Rapid adoption of Rise with SAP solution has been one of the major drivers of cloud business, along with the Cloud ERP Suite, which has contributed significantly to the overall cloud revenue growth. The 33% rise in Cloud ERP Suite revenues for 2024 was a result of SAP’s focus on providing advanced, scalable solutions for enterprise resource planning in the cloud.

Momentum in other cloud offerings like Grow with SAP and SAP Datasphere, as well as strategic acquisitions and collaborations, bodes well for its cloud business.

SAP has been focusing on expanding its reach into the mid-market with a stronger emphasis on partner ecosystems. By empowering partners to target mid-market businesses, SAP has been working to tap into a highly profitable sales channel that has previously been underutilized.

The company has also been focusing on integrating AI across its product suite. It expects business AI to play a key role in driving cloud ERP suite revenues. SAP's cloud-focused strategy delivered strong results, with half of fourth-quarter cloud order entries incorporating AI-use cases. This highlights its growing focus on data and Business AI, which is poised to play a pivotal role in driving revenue growth through 2027.

SAP SE Price and EPS Surprise

SAP SE price-eps-surprise | SAP SE Quote

On the last earnings call, management highlighted that it has incorporated more than 1,300 skills into AI co-pilot, which can now automate 80% of the most-used activities by users. In go-to-market, AI-assisted contract validation has cut SAP's average contract booking time by 75%. In corporate functions, AI-powered quote-to-cash automation has boosted productivity tenfold.

However, the company’s performance has been affected by continued softness in the Software license and support business segment, coupled with global macroeconomic weakness and geopolitical instability.  Also, increasing research & development costs and stiff competition in the cloud space are concerns.

What Our Model Says About SAP

Our proven model does not predict an earnings beat for SAP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

SAP has an Earnings ESP of -0.49% and a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks you may consider, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

Check Point Software Technologies Ltd. CHKP currently has an Earnings ESP of +0.57% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Check Point Software is scheduled to report quarterly earnings on April 23. The Zacks Consensus Estimate for CHKP’s to-be-reported quarter’s earnings and revenues is pegged at $2.19 per share and $636.4 million, respectively. Shares of CHKP have gained 50.3% in the past year.

Woodward, Inc. WWD has an Earnings ESP of +3.95% and a Zacks Rank #2 at present. WWD is scheduled to report quarterly figures on April 28. The Zacks Consensus Estimate for Woodward’s to-be-reported quarter’s earnings and revenues is pegged at $1.44 per share and $829.3 million, respectively. Shares of WWD have gained 15.5% in the past year.

SLM Corporation SLM has an Earnings ESP of +0.51% and a Zacks Rank #3 at present. SLM is scheduled to report quarterly figures on April 24. The Zacks Consensus Estimate for SLM’s to-be-reported quarter’s earnings and revenues is pegged at $1.18 per share and $359.7 million, respectively. Shares of SLM have risen 26.4% in the past year.

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