SAP Faces a Pivotal May: Dividend Vote, Cloud Momentum, and a Key Acquisition on the Horizon

Shareholders in the German software giant have a busy month ahead. On May 5, they will convene for a virtual annual general meeting, where a proposed dividend increase and the company’s strategic direction will be in focus. The backdrop, however, is a stock that has shed more than 26% of its value since the start of the year, trading near €149—a far cry from its 52-week high of roughly €272.

A Dividend Decision and a Strategic Cloud Win

The board has put forward a dividend of €2.50 per share, representing a 6.4% increase over the regular payout for 2024. If approved, the funds are scheduled to reach shareholders' accounts on May 8. To vote at the meeting, investors must demonstrate their holdings by midnight on the day of the event.

Operationally, SAP delivered a solid first quarter. Cloud revenue jumped 27%, pushing total sales to €9.6 billion, while operating profit climbed 24% to €2.9 billion. A €408 million legal settlement weighed on free cash flow, but the underlying business momentum remains intact.

In a significant strategic move, the French technology group Thales has agreed to use SAP’s cloud software, delivered via the S3NS infrastructure—a joint venture between Thales and Google Cloud designed to meet stringent European data protection standards. This deal marks a breakthrough for SAP in the regulated public sector, addressing long-standing concerns about data sovereignty and opening the door to new market share.

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The Reltio Acquisition and AI Ambitions

Alongside the dividend vote, SAP is awaiting regulatory clearance for its planned acquisition of Reltio Inc., a specialist in master data management software. The deal, whose purchase price has not been disclosed, is expected to close in the second or third quarter of 2026. Reltio is central to SAP’s strategy to strengthen its Business Data Cloud, a cornerstone of the company’s artificial intelligence push. CEO Christian Klein has made AI a prerequisite for future cloud growth, and the integration of Reltio is seen as a critical piece of that puzzle.

Analyst Support and a Cautious Outlook

Barclays remains bullish, reiterating its buy rating with a price target of €220. Analysts praised the latest quarterly results, particularly the cloud order backlog, which rose 25% on a currency-adjusted basis to €21.9 billion. This is viewed as evidence that SAP’s transformation from a traditional software vendor to a cloud-first business is gaining traction.

Yet the company has tempered expectations. SAP’s full-year guidance for cloud revenue between €25.8 billion and €26.2 billion and non-IFRS operating profit of €11.9 billion to €12.3 billion is conditional on two factors: a de-escalation of tensions in the Middle East and the completion of the Reltio acquisition. Furthermore, management has warned of a slowdown in cloud growth during the second quarter, as certain one-off effects that boosted the first quarter will not recur.

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What’s Next: Sapphire in Orlando

The next major catalyst for the stock comes in mid-May, when SAP hosts its Sapphire customer conference in Orlando. There, the company will present further details on its AI integration, and investor relations has scheduled a financial analyst conference with board presentations and a Q&A session. According to Gartner, SAP grew roughly 15 percentage points faster than the global market for cloud enterprise applications in 2025. Whether that pace can be sustained will likely be the dominant theme in Orlando.

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