SAP SE (SAP Quick QuoteSAP - Free Report) recently announced plans to acquire master data management (MDM) software provider Reltio, marking an important step in its transformation into an AI-first enterprise software company. Many large enterprises run both SAP and non-SAP systems, and their data is often fragmented across different platforms, departments and formats. This fragmentation makes it difficult for AI systems to generate reliable insights or automate workflows effectively.

Reltio specializes in MDM technology that unifies, cleans and harmonizes data across multiple systems into a single, trusted source of truth. By acquiring Reltio, SAP aims to ensure that enterprise data is consistent, accurate and ready for AI applications. SAP plans to integrate Reltio into SAP Business Data Cloud (SAP BDC), which is becoming the core of its AI strategy. The move directly supports SAP’s AI-First and Suite-First strategy, where AI agents and automation tools operate across the entire enterprise software suite.

Reltio’s platform helps organizations manage and unify structured and unstructured enterprise data to create a single, reliable “golden record” for customers, suppliers, products and employees. Its key capabilities include AI-based entity resolution to merge duplicate records, data cleansing and harmonization across systems, cloud-native architecture, real-time data delivery for AI and analytics, industry-specific data models, and support for multi-agent AI workflows. These capabilities are critical for agentic AI, where AI agents automate tasks like procurement, supply-chain decisions, customer service and risk management.

The acquisition is strategically important for SAP’s AI strategy, particularly around its Joule AI copilot and Joule Agents. By integrating Reltio, SAP customers will gain trusted, unified enterprise data, enabling AI agents to make faster and more accurate decisions, reducing integration complexity and allowing data to be used across both analytics and AI workloads. This move transforms SAP BDC into a fully interoperable enterprise data platform rather than just a database or analytics tool.

SAP SE Price and Consensus

SAP SE price-consensus-chart | SAP SE Quote

The deal is expected to be completed in the second or third quarter of 2026, pending regulatory approvals and standard closing conditions. Importantly, SAP said Reltio will continue to be available as a standalone product, which means existing customers who do not use SAP can still use Reltio.

SAP’s BDC and AI Strategy Emerging as Major Catalyst

SAP Business Data Cloud is gaining traction and is expected to become a major platform for AI-driven operations by unifying enterprise data and powering AI applications with trusted, context-rich information. The platform generated about €2 billion in total contract value in its first year. SAP is also expanding its Business AI portfolio, launching 14 AI agents in the first half of 2025 for areas such as Commerce Cloud search, quoting, customer service, dispute resolution and finance.

SAP’s ongoing cloud transition remains its main growth driver. In the fourth quarter, two-thirds of cloud order entry included AI functionality, up more than 20 percentage points from the previous quarter, showing rapid adoption. Among the 50 largest deals, 90% included AI or Business Data Cloud, and adoption of the AI Copilot increased ninefold in 2025. SAP expects revenue growth to accelerate through 2027, even as software support revenues decline due to continued cloud migration.

Moreover, SAP is driving growth through a differentiated AI strategy that combines Joule, its data-rich AI copilot embedded across applications; extensible, process-integrated AI agents; industry-specific AI solutions; and SAP Business Data Cloud, which breaks down data silos by unifying SAP and non-SAP data. This is complemented by AI-powered ERP migration tools that lower cost and speed time to value. Strong customer adoption supported fourth-quarter deal momentum, while SAP’s own enterprise-wide AI transformation is unlocking efficiency gains, targeting roughly €2 billion in annual cost savings by 2028, reinforcing its position as a leading business AI company.

However, the cloud backlog is pressured by deal mix and longer sales cycles, delaying near-term recognition. Continued weak software license and services revenues hurt it.

SAP’s Zacks Rank & Stock Price Performance

SAP currently carries a Zacks Rank #3 (Hold). Shares of the company have fallen 38.9% in the past year compared with the industry's loss of 10.1%.

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Key Picks From the Computer and Technology Space

Some better-ranked stocks from the broader technology space are Commvault Systems, Inc. (CVLT Quick QuoteCVLT - Free Report) , Pegasystems Inc. (PEGA Quick QuotePEGA - Free Report) and SS&C Technologies Holdings, Inc. (SSNC Quick QuoteSSNC - Free Report) . CVLT and PEGA currently sport a Zacks Rank #1 (Strong Buy), while SSNC carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Commvault Systems’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, while missing once, with the average surprise being 7.8%. In the last reported quarter, CVLT delivered an earnings surprise of 19.4%. Its shares have declined 51.8% in the past year.

Pegasystems’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 80.4%. In the last reported quarter, PEGA delivered an earnings surprise of 5.6%. Its shares have improved 16% in the past year.

SS&C Technologies’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 4.2%. In the last reported quarter, SSNC delivered an earnings surprise of 4.3%. Its shares have decreased 21.7% in the past year.