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SAP Set to Report Q4 Earnings: Here's What You Should Know
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SAP SE (SAP - Free Report) is slated to report fourth-quarter and full-year 2022 results on Jan 26.
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $8.23 billion, which suggests a decline of 9.9% from the year-ago quarter’s reported figure. The consensus mark for earnings is pegged at $1.38 per share, indicating a year-over-year decrease of 35.2%.
For 2022, SAP anticipates cloud revenues in the range of €11.55-€11.85 billion, suggesting an increase of 23-26% at cc. For the full year, the company expects a negative impact of approximately €250 million at constant currencies due to a lack of new business and discontinuation of existing business. For non-IFRS operating profit, the impact is expected to be around €300 million at constant currencies.
The company’s performance in the fourth quarter is likely to have benefited from continued strength in its cloud business (especially the Rise with SAP solution) across all regions. In the last-reported quarter, the Current cloud backlog — a key indicator of go-to-market success in cloud business — increased 38%.
The RISE with SAP solution will likely help SAP increase its market share in the cloud ERP solutions’ space and boost the adoption of its cloud-based solutions, such as SAP S/4HANA. In the last-reported quarter, the Rise with SAP solution was adopted by clients, including Alpargatas, Dabur India Limited, Fonterra, Nikon Corporation, Prada, RICOH CO, Roborock, Salzburg AG, Schneider Electric, Wistron Corporation and 11teamsports.
The company is also likely to benefit from the growing momentum in the SAP Business Technology Platform and SAP Ariba and SAP Signavio solutions.
Apart from that, frequent product launches are likely to boost the top line. In November, the company announced the launch of SAP Build, which leverages the company’s Business Technology Platform to assist customers in easily creating and developing enterprise applications and automating processes etc.
However, global macroeconomic weakness, geopolitical instability and continued softness in software licenses are major headwinds for SAP. Stiff competition in the cloud space and increasing research & development and sales & marketing expenses are added concerns.
What Our Model Says
Our proven model predicts 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.
SAP has an Earnings ESP of +3.09% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combination
Here are some stocks you may consider, as our proven model shows that these have the right mix of elements to beat estimates this time around.
The Zacks Consensus Estimate for AAL’s to-be-reported quarter’s earnings and revenues is pegged at 84 cents per share and $12.96 billion, respectively. Shares of AAL have lost 0.4% in the past year.
Xcel Energy (XEL - Free Report) has an Earnings ESP of +2.99% and currently has a Zacks Rank #2. XEL is scheduled to report earnings on Jan 26.
The Zacks Consensus Estimate for XEL’s to-be-reported quarter’s earnings and revenues is pegged at 67 cents per share and $3.52 billion, respectively. Shares of XEL have gained 1.6% in the past year.
Axos Financial (AX - Free Report) has an Earnings ESP of +0.16% and currently has a Zacks Rank #2. AX is scheduled to report earnings on Jan 26.
The Zacks Consensus Estimate for AX’s to-be-reported quarter’s earnings and revenues is pegged at $1.24 per share and $216.37 million, respectively. Shares of AX have lost 24.9% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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SAP Set to Report Q4 Earnings: Here's What You Should Know
SAP SE (SAP - Free Report) is slated to report fourth-quarter and full-year 2022 results on Jan 26.
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $8.23 billion, which suggests a decline of 9.9% from the year-ago quarter’s reported figure. The consensus mark for earnings is pegged at $1.38 per share, indicating a year-over-year decrease of 35.2%.
For 2022, SAP anticipates cloud revenues in the range of €11.55-€11.85 billion, suggesting an increase of 23-26% at cc. For the full year, the company expects a negative impact of approximately €250 million at constant currencies due to a lack of new business and discontinuation of existing business. For non-IFRS operating profit, the impact is expected to be around €300 million at constant currencies.
SAP SE Price and EPS Surprise
SAP SE price-eps-surprise | SAP SE Quote
Factors to Note
The company’s performance in the fourth quarter is likely to have benefited from continued strength in its cloud business (especially the Rise with SAP solution) across all regions. In the last-reported quarter, the Current cloud backlog — a key indicator of go-to-market success in cloud business — increased 38%.
The RISE with SAP solution will likely help SAP increase its market share in the cloud ERP solutions’ space and boost the adoption of its cloud-based solutions, such as SAP S/4HANA. In the last-reported quarter, the Rise with SAP solution was adopted by clients, including Alpargatas, Dabur India Limited, Fonterra, Nikon Corporation, Prada, RICOH CO, Roborock, Salzburg AG, Schneider Electric, Wistron Corporation and 11teamsports.
The company is also likely to benefit from the growing momentum in the SAP Business Technology Platform and SAP Ariba and SAP Signavio solutions.
Apart from that, frequent product launches are likely to boost the top line. In November, the company announced the launch of SAP Build, which leverages the company’s Business Technology Platform to assist customers in easily creating and developing enterprise applications and automating processes etc.
However, global macroeconomic weakness, geopolitical instability and continued softness in software licenses are major headwinds for SAP. Stiff competition in the cloud space and increasing research & development and sales & marketing expenses are added concerns.
What Our Model Says
Our proven model predicts 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.
SAP has an Earnings ESP of +3.09% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combination
Here are some stocks you may consider, as our proven model shows that these have the right mix of elements to beat estimates this time around.
American Airlines Group (AAL - Free Report) has an Earnings ESP of +9.79% and currently has a Zacks Rank #2. AAL is scheduled to report earnings on Jan 26. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for AAL’s to-be-reported quarter’s earnings and revenues is pegged at 84 cents per share and $12.96 billion, respectively. Shares of AAL have lost 0.4% in the past year.
Xcel Energy (XEL - Free Report) has an Earnings ESP of +2.99% and currently has a Zacks Rank #2. XEL is scheduled to report earnings on Jan 26.
The Zacks Consensus Estimate for XEL’s to-be-reported quarter’s earnings and revenues is pegged at 67 cents per share and $3.52 billion, respectively. Shares of XEL have gained 1.6% in the past year.
Axos Financial (AX - Free Report) has an Earnings ESP of +0.16% and currently has a Zacks Rank #2. AX is scheduled to report earnings on Jan 26.
The Zacks Consensus Estimate for AX’s to-be-reported quarter’s earnings and revenues is pegged at $1.24 per share and $216.37 million, respectively. Shares of AX have lost 24.9% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.