SAP leans on cloud momentum and agentic AI to drive growth
SAP's Q3 2025 shows steady cloud traction: cloud revenue rose 22% year over year, marking a fifth straight quarter of strong gains, though slightly below Q2's 24% pace. Total revenue hit roughly $10.5 billion, up 7% year over year, compared to 9% in Q2.
Leadership signaled confidence heading into Q4, citing a strong pipeline and an ambition to accelerate total revenue growth in 2026. The message is clear: cloud-first motion continues, and AI is the multiplier.
Where the growth is coming from
SAP is channeling demand through its cloud ERP suite and modernization programs like RISE and GROW to move customers off on-premise stacks and into subscription models. In Q3, enterprises such as Alphabet, Ericsson and Lufthansa opted for RISE with SAP.
The company's cloud backlog grew 23% year over year to $21.8 billion (18.8 billion euros), a concrete signal of committed demand. As Forrester's Akshara Naik Lopez put it, the performance of the cloud business is SAP's most critical focus.
For context on SAP's modernization program, see RISE with SAP.
The agentic AI thesis
SAP is building an agentic AI layer across its value chain, orchestrated through AI assistants that serve specific roles and functions. These assistants act as the interface to human operators while coordinating specialized agents under the hood.
Leadership described a supply chain planner's assistant that can reroute goods, optimize inventory and onboard suppliers in one thread-then pull in the right agents as needed. The goal: fewer handoffs, faster cycle times and measurable business value. SAP expects AI to be a key enabler for growth through 2027.
Signals from the market
Other large enterprises are moving in the same direction. BNY reports 117 agentic tools deployed across the bank, operating semi-autonomously with supervision. Walmart is pursuing similar capabilities.
BNY distinguishes between AI agents (defined scope, bounded autonomy) and "digital employees" (their own login, operating autonomously with oversight). "Our digital engineers are doing vulnerability management… If it's low complexity, they'll fix the code autonomously and submit to the manager. If it's high complexity, they'll notify the manager," said Leigh-Ann Russell, CIO and global head of engineering at BNY.
What this means for executives
- Cloud lock-in and upsell: Expect tighter packaging of ERP, data, and AI features through RISE and GROW. Budget for bundled pricing and the process redesign that comes with it.
- Backlog as a demand signal: A $21.8B backlog suggests capacity planning is critical-line up partners, integrations and change management early.
- Agentic operating model: Define autonomy levels, escalation paths and guardrails for agents and "digital employees." Track cycle time, exception rates, and human-in-the-loop interventions.
- Data readiness: Clean master data and event streams in S/4HANA and BTP so agents have reliable context. Poor data will stall outcomes.
- Skills and org: Build a core team-AI product owners, data engineers, security and compliance leads, and business SMEs. Upskill planners, buyers, and FP&A on agent workflows.
- Risk and compliance: Require traceability, audit trails and role-based access. Review third-party agent risk and negotiate data egress flexibility.
Moves to consider this quarter
- Pick two agentic use cases with direct P&L impact (e.g., inventory optimization, invoice matching) and define success metrics before you build.
- Request SAP's near-term agent roadmap, integration patterns and cost model; compare TCO with hyperscaler-native agents.
- Renegotiate RISE/GROW terms for AI entitlements, observability and data portability.
- Stand up an internal policy for "digital employees" clarifying autonomy, supervision, and accountability.
- Pilot with a co-development partner; measure throughput, exception reduction and user satisfaction over 60-90 days.
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