Citizens downgraded SAP from Market Outperform to Market Perform on Friday after the company's fourth-quarter results failed to meet several key revenue and cloud-growth expectations.
Shares of SAP are trading around $200.21 and have declined by more than 13% over the past week. The company experienced an even larger one-day move earlier in the week, with shares falling roughly 15% on Thursday, and are down about 18% year-to-date. By comparison, both the Russell 3000 and the S&P 500 have each risen by about 2% year-to-date.
On the earnings front, SAP reported fourth-quarter non-IFRS earnings per share of 1.62, beating the consensus estimate of 1.51. The company also posted operating profit of 2.83 billion, above the expected 2.75 billion. InvestingPro data shows SAP retains a Piotroski Score of 9, a figure that indicates strong financial metrics under that scoring system.
Despite those upside surprises on the bottom line and operating-profit measure, total revenue for the quarter was 9.68 billion, below the consensus outlook of 9.75 billion. Cloud revenue reached 5.61 billion, narrowly missing the anticipated 5.64 billion.
Citizens highlighted additional weakness in SAP's cloud backlog growth. The firm noted cloud backlog grew 25% in constant currency in the quarter, the slowest rate in nine quarters and slightly under the expected pace of 26%.
Separate reporting of fourth-quarter 2025 results included figures presented in dollars: earnings per share of $1.62, which was below the $1.76 analysts had expected, and quarterly revenue of $9.68 billion, missing a $11.35 billion projection. According to those reports, the company's shares were stable in pre-market trading and saw no significant immediate price change after that earnings release.
Taken together, SAP's results combined pockets of outperformance with several notable shortfalls. Citizens' downgrade reflects concern about the revenue and cloud-growth trajectory even as SAP delivered on certain profit measures. Market reaction to the mixed set of metrics has been pronounced, producing sharp near-term share-price moves.