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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 2023 results on Jan 24.
The Zacks Consensus Estimate for revenues is pegged at $8.98 billion, implying an improvement of 4.3% from the year-ago quarter’s reported figure. The consensus mark for earnings is pegged at $1.64 per share, indicating an increase of 60.8% from the prior-year quarter.
SAP reported third-quarter 2023 non-IFRS earnings per share of €1.45 ($1.58), which increased 32% from the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.40. Total revenues on a non-IFRS basis of €7.744 billion ($8.428 billion) improved 4% year over year (up 9% at constant currency or cc). The Zacks Consensus Estimate was pegged at $8.578 billion.
SAP’s performance in the to-be-reported quarter is likely to have benefited from continued momentum in cloud business. SAP’s cloud business is gaining momentum across Asia-Pacific, Europe and the Middle East and Africa, and the Americas region.
The company’s cloud efforts have received a major push from the rapid adoption of Rise with SAP solution. This solution helps companies transform their business processes and operations to become more nimble, digital and intelligent. RISE with SAP solution continues to gain significant traction and will aid the company in driving its market share in the cloud ERP solutions space.
The company is also likely to have gained from growing momentum in SAP S/4HANA, SAP Business Technology Platform and Grow with SAP solution. Grow with SAP is designed especially for midsize customers to adopt cloud ERP and boost speed and predictability while fostering innovation.
In the last reported quarter, the current cloud backlog — a key indicator of go-to-market success in cloud business — increased 19%. Our estimate for cloud revenues (on a non-IFRS basis) for the fourth quarter is pegged at €4.03 billion, up 31.1% from the year-ago quarter.
However, the company’s performance is 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.
Recent Key Development
On Oct 25, 2023, SAP unveiled new generative AI capabilities across its SAP Customer Experience portfolio, including SAP’s natural-language generative AI copilot Joule.
What Our Model Says
Our proven model does not conclusively 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.
SAP has an Earnings ESP of -2.14% and a Zacks Rank #3. 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 season.
The Zacks Consensus Estimate for NFLX’s to-be-reported quarter’s earnings and revenues is pegged at $2.20 per share and $8.72 billion, respectively. Shares of NFLX have gained 41.7% in the past year.
Seagate Technology Holdings plc (STX - Free Report) has an Earnings ESP of +100.00% and presently carries a Zacks Rank #2. STX is slated to release quarterly numbers on Jan 24.
The Zacks Consensus Estimate for STX’s to-be-reported quarter’s revenues is pegged at $1.55 billion. The consensus estimate is pegged at a loss of 8 cents per share. Shares of STX have gained 41.5% of their value in the past year.
Western Digital Corporation (WDC - Free Report) has an Earnings ESP of +6.94% and a Zacks Rank #2. WDC is set to report quarterly figures on Jan 25.
The Zacks Consensus Estimate for WDC’s to-be-reported quarter’s revenues is pegged at $2.99 billion. The consensus estimate is pegged at a loss of $1.13 per share. Shares of WDC have increased 39.2% 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 2023 results on Jan 24.
The Zacks Consensus Estimate for revenues is pegged at $8.98 billion, implying an improvement of 4.3% from the year-ago quarter’s reported figure. The consensus mark for earnings is pegged at $1.64 per share, indicating an increase of 60.8% from the prior-year quarter.
SAP reported third-quarter 2023 non-IFRS earnings per share of €1.45 ($1.58), which increased 32% from the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.40. Total revenues on a non-IFRS basis of €7.744 billion ($8.428 billion) improved 4% year over year (up 9% at constant currency or cc). The Zacks Consensus Estimate was pegged at $8.578 billion.
SAP SE Price and EPS Surprise
SAP SE price-eps-surprise | SAP SE Quote
Factors to Note
SAP’s performance in the to-be-reported quarter is likely to have benefited from continued momentum in cloud business. SAP’s cloud business is gaining momentum across Asia-Pacific, Europe and the Middle East and Africa, and the Americas region.
The company’s cloud efforts have received a major push from the rapid adoption of Rise with SAP solution. This solution helps companies transform their business processes and operations to become more nimble, digital and intelligent. RISE with SAP solution continues to gain significant traction and will aid the company in driving its market share in the cloud ERP solutions space.
The company is also likely to have gained from growing momentum in SAP S/4HANA, SAP Business Technology Platform and Grow with SAP solution. Grow with SAP is designed especially for midsize customers to adopt cloud ERP and boost speed and predictability while fostering innovation.
In the last reported quarter, the current cloud backlog — a key indicator of go-to-market success in cloud business — increased 19%. Our estimate for cloud revenues (on a non-IFRS basis) for the fourth quarter is pegged at €4.03 billion, up 31.1% from the year-ago quarter.
However, the company’s performance is 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.
Recent Key Development
On Oct 25, 2023, SAP unveiled new generative AI capabilities across its SAP Customer Experience portfolio, including SAP’s natural-language generative AI copilot Joule.
What Our Model Says
Our proven model does not conclusively 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.
SAP has an Earnings ESP of -2.14% and a Zacks Rank #3. 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 season.
Netflix (NFLX - Free Report) has an Earnings ESP of +2.10% and currently carries a Zacks Rank #2. NFLX is scheduled to report quarterly earnings on Jan 23. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for NFLX’s to-be-reported quarter’s earnings and revenues is pegged at $2.20 per share and $8.72 billion, respectively. Shares of NFLX have gained 41.7% in the past year.
Seagate Technology Holdings plc (STX - Free Report) has an Earnings ESP of +100.00% and presently carries a Zacks Rank #2. STX is slated to release quarterly numbers on Jan 24.
The Zacks Consensus Estimate for STX’s to-be-reported quarter’s revenues is pegged at $1.55 billion. The consensus estimate is pegged at a loss of 8 cents per share. Shares of STX have gained 41.5% of their value in the past year.
Western Digital Corporation (WDC - Free Report) has an Earnings ESP of +6.94% and a Zacks Rank #2. WDC is set to report quarterly figures on Jan 25.
The Zacks Consensus Estimate for WDC’s to-be-reported quarter’s revenues is pegged at $2.99 billion. The consensus estimate is pegged at a loss of $1.13 per share. Shares of WDC have increased 39.2% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.