SAP FY 2025 free cash flow jumps 95% to EUR 8.2 billion

Reuters02-26
SAP FY 2025 free cash flow jumps 95% to EUR 8.2 billion

SAP reported FY 2025 results with total revenue of EUR 36.8 billion (up 8%). Cloud revenue was EUR 21.0 billion (up 23%), including Cloud ERP Suite revenue of EUR 18.1 billion (up 28%), while cloud and software revenue rose to EUR 32.5 billion (up 9%). Services revenue was EUR 4.3 billion (down 2%). Current cloud backlog was EUR 21.1 billion (up 16%) and total cloud backlog was EUR 77.3 billion (up 22%). FY 2025 operating profit was EUR 9.6 billion and operating margin was 26.1%, supported by sharply lower restructuring expenses of EUR 3 million following the company-wide restructuring program announced in January 2024 and concluded in early 2025. SAP also recorded EUR 238 million in termination benefits outside restructuring plans, including EUR 191 million tied to a workforce transformation announced in late July 2025, and booked a EUR 387 million provision related to the Teradata litigation. FY 2025 net cash flows from operating activities were EUR 9.2 billion (up 76%) and free cash flow was EUR 8.2 billion (up 95%). The IFRS effective tax rate was 28.7%. On the business side, SAP said customers increasingly prioritized AI embedded in core workflows, with more than two-thirds of cloud order entry in Q4 FY 2025 containing SAP Business AI. The company also highlighted continued momentum in its cloud portfolio, including RISE with SAP, SAP GROW, SAP Business Technology Platform, SAP Business Data Cloud and Joule, alongside growing demand for sovereign cloud deployments.

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