July 26, 2025
5 min read
Mark Brohan
SAP's Q2 revenue rose 12% to €9B, fueled by cloud ERP growth and AI-powered agents automating business tasks.
SAP Sees Strong Demand for Cloud, AI, and Data Tools
SAP reported strong Q2 results, highlighting rising global demand for its cloud software, artificial intelligence (AI) tools, and data platforms despite economic and geopolitical uncertainties affecting some sectors. CEO Christian Klein emphasized that SAP's long-term investments in cloud infrastructure and AI are paying off, even as industries like the U.S. public sector and manufacturing delay purchases due to trade concerns.“Whatever the market environment may bring, SAP is well prepared,” Klein said during the earnings call. “We’re making big moves in product innovation and rapidly improving our own productivity with AI.”
How SAP Invested in AI Agents in Q2
- Cloud revenue increased 28% in the quarter.
- The core Cloud ERP suite, covering finance, supply chain, and human resources, grew 34%, marking over three years of consistent double-digit growth.
- Total revenue rose 12% to €9 billion (US$9.8 billion).
- Operating profit surged 35% to €2.6 billion (US$2.84 billion), driven by cloud growth, cost controls, and SAP’s internal use of AI to boost efficiency. SAP is heavily investing in AI-powered "agents" that automate common business tasks. In the first half of 2025, it launched 14 such agents. These AI agents assist with generating quotes, managing expense reports, resolving service disputes, and financial forecasting. SAP plans to offer 40 agents by the end of 2025. Additionally, SAP is expanding its business data cloud platform, enabling companies to analyze and utilize data more effectively across operations. New customers such as Adobe, GSK, and BAE Systems have adopted the platform, with a growing sales pipeline. SAP is also deepening its partnership with Palantir to enhance data capabilities.
- 30% improvement in developer productivity
- 20% reduction in HR support response times
- Up to 50% efficiency boost for sales teams These improvements have helped SAP control expenses and improve profit margins.
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New SAP Features
With increasing demand for data sovereignty, SAP offers end-to-end control features including "bring your own key" encryption, localized data centers, and compatibility with global cloud providers and local infrastructure. New public-sector customers in Q2 include Germany’s federal pension agency and the German Armed Forces, which signed deals for SAP’s analytics, project management, and AI tools. SAP uses its AI assistant, Joule, internally, achieving:“It’s already clear that AI will increase productivity — not just at SAP, but across industries,” Klein said.CFO Dominik Asam maintained SAP’s full-year outlook but noted that trade uncertainty and regulatory risks are delaying some deals, especially in government procurement and global manufacturing sectors. SAP’s backlog of cloud business rose 28% to €18.1 billion (US$19.8 billion), and free cash flow increased 83% to €2.4 billion (US$2.63 billion).
“Our strategy is working, and our offerings are mission-critical to customers,” Asam said. “But we are preparing SAP for less favorable outcomes by focusing on disciplined execution and cost control.”SAP expects most new cloud business to close in the second half of 2025, consistent with its typical sales cycle, betting on continued AI and data tool innovation to meet evolving customer needs. Source: SAP sees strong demand for cloud, AI, and data tools on Digital Commerce 360.