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SAP SE (/ˌɛs.eɪˈpiː/; German pronunciation: [ɛsʔaːˈpeː] ⓘ) is a German multinational software company based in Walldorf, Baden-Württemberg, Germany. The company is the world's largest vendor of enterprise resource planning (ERP) software.[3][4][5]
Key Information
SAP GbR became in 1981 fully Systeme, Anwendungen und Produkte in der Datenverarbeitung (Systems, Applications and Products in Data Processing) abbreviated SAP GmbH after a five-year transition period beginning in 1976.[6] In the late 1980s, it further restructured itself as SAP AG.[7] Since 7 July 2014, its corporate structure is that of a pan-European societas Europaea (SE);[8][9][10][11] as such, its former German corporate identity is now a subsidiary, SAP Deutschland SE & Co. KG.[10] It has regional offices in 180 countries[12][13] and over 111,961 employees.[14]
SAP is a component of the DAX and Euro Stoxx 50 stock market indices.[15] The company is the largest non-American software company by revenue and the world's fifth-largest publicly traded software company by revenue. In June 2025, it was the largest European company by market capitalization, as well as one of the 30 most valuable publicly traded companies in the world.[16]
History
[edit]20th century
[edit]When Xerox exited the computer hardware manufacturing industry in 1971,[17] it asked IBM to migrate its business systems to IBM technology. As part of IBM's compensation for the migration, IBM was given the rights to the Scientific Data Systems (SDS)/SAPE software repository. Five IBM engineers from the AI department[18][19] (Dietmar Hopp, Klaus Tschira, Hans-Werner Hector, Hasso Plattner, and Claus Wellenreuther, all from Mannheim, Baden-Württemberg) were working on an enterprise-wide system based on this software, only to be told that it would no longer be necessary. Rather than abandoning the project, they decided to leave IBM Tech and start another company.[3][20] In June 1972 they founded the SAP Systemanalyse und Programmentwicklung ("System Analysis and Program Development" / "SAPD") company, as a private partnership under the German Civil Code.[21]
Their first client was the German branch of Imperial Chemical Industries in Östringen,[22] where they developed mainframe programs for payroll and accounting. Instead of storing the data on punch cards mechanically, as IBM did, they stored it locally in the Electronic System while using a common Logical database for all activities of Organization.[clarification needed] Therefore, they called their software a real-time system, since there was no need to process the punch cards overnight (for this reason their flagship product carried an R in its name until the late 1990s). This first version was also a standalone software that could be offered to other interested parties.[23]
In 1973, SAP launched its first commercial product, the RF financial accounting system. This system served as the cornerstone in the ongoing development of other software modules of the system that eventually bore the name SAP R/1.[21] This offered a common system for multiple tasks. This permitted the use of a centralized data storage, improving the maintenance of data. From a technical point of view, therefore, a database was necessary.[24]
In 1976 SAP GmbH Systeme, Anwendungen und Produkte in der Datenverarbeitung ("Systems, Applications, and Products in Data Processing") was founded as a sales and support subsidiary. Five years later, the private partnership was dissolved and its rights were passed on to SAP GmbH.[21]The headquarters moved the following year to Walldorf, Germany.
In 1979, SAP launched SAP R/2, expanding the capabilities of the system to other areas, such as materials management and production planning.
In 1981, SAP brought a re-designed product to market. However, SAP R/2 did not improve until between 1985 and 1990.
In 1992, SAP released SAP R/3. SAP developed and released several versions of R/3 through 1995.
In August 1988, SAP GmbH became SAP AG, and public trading started on 4 November 1988. Shares were listed on the Frankfurt and Stuttgart stock exchanges.[20] In 1995, SAP was included in the German stock index DAX and, on 22 September 2003, SAP was included in the STOXX Europe 50.[25]
In the mid-1990s, SAP transitioned from mainframe computing to a client–server architecture. In 1996 it began its alliance with the Spanish technology consulting firm Seidor, initiating the expansion of SAP solutions throughout Latin America.[26]
21st century
[edit]
In 2004, R/3 was replaced with SAP ERP Central Component (ECC) 5.0.[27] Architectural changes were also made to transition customers to a service-oriented architecture.
The company's official name became SAP AG (a public limited company) after the 2005 annual general meeting.
In 2006, SAP ERP 6.0 was released. SAP ERP 6.0 is the latest version has since been updated through SAP enhancement packs, the most recent being enhancement package 8 for SAP ERP 6.0 in 2016.[28]
Since 2012 SAP has acquired several companies that sell cloud-based products, with several multi-billion-dollar acquisitions seen by analysts as an attempt to challenge competitor Oracle.[29] In 2014 SAP bought Concur Technologies, a provider of cloud-based travel and expense management software, for $8.3 billion, SAP's most expensive purchase to that date.[30] Analysts' reactions to the purchase were mixed, with Thomas Becker of Commerzbank questioning whether Concur was the right choice for SAP, while Credit Suisse called the acquisition an "aggressive" move.[31]
On 21 May 2014, SAP AG announced during the Annual General Meeting of Shareholders that 99% of the shareholder votes approved the conversion of legal form to a European stock corporation (Societas Europaea, SE) and at the same time, elected the first supervisory board of SAP SE. The conversion of the company's legal form would take place upon entry in the commercial register, expected to be in July 2014.[32][33]
On 7 July 2014, SAP announced it had changed its legal form to a European Company (Societas Europaea, SE). As a result, its German subsidiary was renamed to SAP Deutschland SE & Co. KG.[10][34] The conversion cost the company approximately €4 million.[35] In 2014 IBM and SAP began a partnership to sell cloud-based services.[36] Likewise, in 2015, SAP also partnered with HPE to provide secure hybrid cloud-based services running the SAP platform.[37] Both HPE and IBM provide infrastructure services to SAP, and SAP runs its SAP HANA cloud solution on top. SAP has announced additional partnerships with Microsoft in order to give customers tools for data visualization, as well as improved mobile applications.[38]
In 2015, SAP exceeded its revenue projections due to the expansion in its cloud business and the success of SAP HANA. The growth can also be partially attributed to the acquisitions of Concur and Fieldglass.[39] Since 2017, SAP is a founding member of the EU Cloud Code of Conduct.[40] Since May 2021 SAP has listed selected Cloud Service adherent to the EU Cloud Code of Conduct as one of the first Cloud Service Providers.[41]
The company announced plans in 2016 to invest heavily into technology relating to the Internet of things (IoT) as part of a strategy to capitalize on the growth in that market. For that purpose, €2 billion is planned for investment in relevant sectors by the end of 2020.[42] SAP will also launch a new product line called SAP IoT, which "will combine large amounts of data from things connected to the Internet with machine learning and SAP's real-time database S/4 HANA."[42]
On 29 January 2019, SAP announced plans to cut approximately 4,000 positions at the company in a strategic plan to shift to more modern cloud-based technologies such as blockchain, quantum computing, machine learning, Internet of Things, and artificial intelligence.[43]
On 13 April 2021, SAP announced the formation of the joint venture SAP Fioneer, a dedicated Financial Services Industry (FSI) Unit between SAP and investment company Dediq GmbH.[44][45] Dediq GmbH invested over €500 million in the newly formed unit and received an 80 percent share in return. SAP brought its products, organizational units and the sales network into the business and holds 20 percent of the shares.[46]
In June 2025, it was reported that the company had reached €320bn in value and that 4 out of 5 of SAP's client operations were now managed through its cloud business at hyperscale level.[47]
Acquisitions
[edit]Since 1991, SAP has acquired more than 70 companies.
Products
[edit]
As well as its main ERP products, the company also sells database software and technology (particularly its own brand, SAP HANA) and cloud-engineered systems. It sells other ERP software products[clarification needed] such as:
- Human capital management (HCM) software
- Customer relationship management (CRM) software
- Enterprise performance management (EPM) software
- Product lifecycle management (PLM) software
- Supplier relationship management (SRM) software
- Supply chain management (SCM) software
- Business technology platform (BTP) software
- The SAP AppGyver programming environment
Finances
[edit]| Region | share |
|---|---|
| United States | 32.7% |
| EMEA (without Germany) | 29.1% |
| Germany | 15.8% |
| Asia Pacific (without Japan) | 10.8% |
| Americas (without US) | 8.2% |
| Japan | 4.0% |
For the fiscal year 2017 SAP reported earnings of €4 billion, with an annual revenue of €23.5 billion, an increase of 6.3% over the previous fiscal cycle.[49] SAP's shares traded at over US$154 per share, and its market capitalization was valued at US$180 billion in December 2023,[50] making it the largest German company by market capitalization.[51]
The key trends for SAP are (as at the financial year ending 31 March):[52][53][54]
| Year | Revenue (€ bn) |
Net income (€ bn) |
Total assets (€ bn) |
Employees | Sources |
|---|---|---|---|---|---|
| 2013 | 16.8 | 3.3 | 27.0 | 66,572 | |
| 2014 | 17.5 | 3.2 | 38.5 | 74,406 | |
| 2015 | 20.7 | 3.0 | 41.3 | 76,986 | |
| 2016 | 22.0 | 3.6 | 44.2 | 84,183 | |
| 2017 | 23.4 | 4.0 | 42.4 | 88,543 | |
| 2018 | 24.7 | 4.0 | 51.5 | 96,498 | |
| 2019 | 27.5 | 3.3 | 60.2 | 100,330 | [55] |
| 2020 | 27.3 | 5.1 | 58.4 | 103,876 | [56] |
| 2021 | 27.8 | 5.2 | 71.1 | 107,415 | |
| 2022 | 30.8 | 2.2 | 72.1 | 111,961 | |
| 2023 | 31.2 | 6.1 | 68.2 | 106,043 | |
| 2024 | 34.2 | 3.1 | 74.1 | 107,155 |
Corporate structure and ownership
[edit]
SAP had the following ownership structure in early 2024:[57]
| Shareholder name | Percentage |
|---|---|
| Hasso Plattner | 6.60% |
| BlackRock, Inc. | 5.53% |
| Dietmar Hopp Stiftung GmbH | 5.04% |
| SAP SE | 5.01% |
| Capital Group Companies Inc. | 3.27% |
| Klaus Tschira Stiftung gGmbH | 3.63% |
| Goldman Sachs | 0.39% |
| Free float | 70.53% |
SAP uses a two-tier structure of boards with an executive board and a supervisory board.[58][59] In October 2019 Jennifer Morgan and Christian Klein were appointed as co-CEOs of SAP.[60] In April 2020 it was announced that Jennifer Morgan will leave SAP and Christian Klein will continue to operate as the sole CEO, citing that the current environment of the COVID-19 recession requires "companies to take swift, determined action which is best supported by a very clear leadership structure".[61]
The majority of the company's employees are in Germany and United States. About 20,000 employees are based in Germany[62] and about 19,311 employees are based in the United States.[63][64]
45 employee representatives were elected in 2022 to the SAP SE Works Council, including 15 candidates from the Ver.di and IG Metall trade union lists. They represent 17,000 employees of Germany.[65]
Headquarters is responsible for overall management as well as core engineering activities related to product development. Worldwide customer support is not provided by the field organizations but by a unified organization called Active Global Support (AGS).[66]
The company also encourages employees to volunteer through social sabbaticals, sending teams of people to different countries to aid non-profits. SAP employees have volunteered in China, India, Brazil, and South Africa.[67]
Research and development
[edit]SAP Labs Network consists of all major global Research & Development Hubs of SAP, across more than 20 countries and representing more than 80% of SAP’s global engineering workforce.
Major Hubs of SAP are Germany, India,[68] USA and China, and growing Hubs in East Asia, Eastern Europe, Canada and Latin America.[69]
Criticism and controversy
[edit]Since May 2015, the company has dealt with a series of high-profile bribery investigations,[70][71][72] including one that led to them paying $3.9 million to settle U.S. Securities and Exchange Commission civil charges over a former executive's scheme to bribe Panama government officials in order to win lucrative technology contracts.[70][73]
In July 2017 allegations were made that SAP had been involved in business transactions with the controversial and politically influential Gupta family in South Africa. SAP was accused of paying CAD House, a Gupta-controlled company, R100 million in order to secure a Transnet deal. SAP denied the allegations, claiming that the money was paid as "an extension of the sales force", despite CAD House having no prior SAP experience.[71][74] The dealings of the Gupta family with SAP were revealed in a widely publicized e-mail leak.[75][76] As a consequence of the allegations SAP launched an investigation that led to four of its South African managers being placed on administrative leave along with the seizure of their mobile phones and computers.[77] Claas Kuehnemann was named as acting managing director for Africa while the investigation continued.[78] On 26 October 2017 SAP announced that it had voluntarily reported itself to the U.S. Securities and Exchange Commission (SEC) for a possible violation of US law, including the Foreign Corrupt Practices Act (FCPA), related to the South African bribery allegations. SAP's own investigation, conducted by law firm Baker McKenzie, revealed that SAP had paid $7.7 million in commissions to third-parties linked to the Gupta family while securing contracts worth $48 million with Transnet and Eskom.[79][80][81]
In 2018 and in an ongoing court battle, Teradata accused SAP of IP theft and fraudulent behaviour.[82][83] In 2021, in the German weekly news magazine Der Spiegel, additional claims were made of questionable behaviour with regards to SAP's funding of researchers at the University of Mannheim - who were in effect paid by SAP to investigate competitors technology.[82][84] In a later article, Der Spiegel magazine maintained that SAP had been neglectful in maintaining strict governance for years.[85] In June 2022 the German business magazine Manager Magazin published an article stating the management style of the leadership might be responsible for an increased compliance risk.[86]
In February 2019 SAP was accused of 'improper conduct' linked to state contracts in Kenya and Tanzania. An anonymous whistle-blower claims, through a firm of attorneys, that SAP used Twenty Third Century Systems (TTCS) to bribe officials at the Tanzania Ports Authority (TPA) to win a US$6.6 million enterprise resource planning software tender that involved the provision of software licenses and services.[72]
In 2021 SAP admitted in a United States court that it exported software to firms in Iran, contrary to US sanctions against Iran, which led to a fine of $8 million.[87][88][89]
In May 2022, multiple claims were made of bullying and sexual harassment within the company, with many cases of unwanted advances by senior male managers on female colleagues. When complaints were made or information made available, HR were found to be unhelpful or hostile. For example, in one case a female employee was groped by a male manager in Sydney while at a company event, but he was never brought to account. In another case, a female employee was sexually targeted by a manager and asked to keep her web camera on during the day. She then complained and was placed under "performance management" - a precursor to being asked to leave the company.[90] Several female executives, including the Co-CEO left the company, adding to concerns that women were negatively treated, despite SAP then hiring several other senior women from Microsoft.[91]
In 2024 after investigations by the U.S. Justice Department and the Securities and Exchange Commission, SAP was ordered to pay $220 million to resolve violations of the Foreign Corrupt Practices Act in South Africa, Indonesia, Tanzania, Malawi, Ghana, Kenya, Zimbabwe and Azerbaijan. It paid bribes to officials in state-owned enterprises to gain government contracts. It entered into a three-year deferred prosecution agreement, paying a criminal penalty of $118.8 million and an administrative forfeiture of $103,396,765.[92][93] In South Africa SAP used third-party intermediaries to acquire tenders from various state-owned entities, including Transnet, the South African Revenue Service, the City of Johannesburg, Eskom and the Department of Water and Sanitation.[94][93]: 4 In March 2024, SAP agreed to pay R500 million as part of an agreement with South Africa's Special Investigating Unit. The agreement indemnifies them against further financial claims related to the bribery, but does not absolve any parties from criminal prosecution.[95]
On September 3, 2024 it was announced that CTO and Executive Board Member Juergen Mueller reached a mutual agreement to leave the company by the end of the month due to incident of inappropriate behavior at a company event.[96][97] Following the news of this incident it was reported on September 13, 2024 that German prosecutors have opened a formal investigation of sexual harassment between him and the female employee.[98]
See also
[edit]References
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Bibliography
[edit]- Iansiti, Marco; Lakhani, Karim R. (2 April 2009). "SAP AG: Orchestrating the Ecosystem". Harvard Business School. 609–069. SSRN 1408558. Retrieved 19 November 2023.
- Meissner, Gerd (2000). SAP: Inside the Secret Software Power. McGraw-Hill. ISBN 978-00-71347-85-3.
- Regan, Gerard O’ (2015). SAP SE. In: Pillars of Computing. Springer Nature Switzerland AG. pp. 189–194. doi:10.1007/978-3-319-21464-1_29. ISBN 978-3-319-21463-4.
External links
[edit]- Official website

- Business data for SAP SE:
Media related to SAP at Wikimedia Commons
SAP SE is a German multinational software corporation headquartered in Walldorf, Baden-Württemberg, founded on 1 April 1972 by five former IBM employees as Systemanalyse und Programmentwicklung, later renamed to stand for Systeme, Anwendungen und Produkte in der Datenverarbeitung (Systems, Applications, and Products in Data Processing). The company develops enterprise application software focused on enterprise resource planning (ERP) systems that integrate core business processes including finance, human resources, manufacturing, and supply chain management. SAP has become the world's largest non-American software firm by market capitalization and revenue, serving over 440,000 customers in more than 180 countries with offerings like SAP S/4HANA, an in-memory ERP platform supporting real-time analytics and cloud deployment, alongside innovations in AI and industry-specific modules that have driven annual revenues exceeding €31 billion. Its developments have standardized global business software for operational efficiency in large enterprises, though implementations often demand substantial customization. SAP has encountered controversies, including a $220 million settlement in 2024 for Foreign Corrupt Practices Act violations involving bribery in countries like South Africa and Indonesia, as well as antitrust disputes, such as a 2025 U.S. court ruling allowing claims by competitor Celonis of monopolization through restrictions on third-party ERP data access to proceed.
History
Founding and Early Development
SAP was founded on April 1, 1972, by five former IBM employees—Dietmar Hopp, Hasso Plattner, Claus Wellenreuther, Klaus Tschira, and Hans-Werner Hector—as Systemanalyse und Programmentwicklung (Systems Analysis and Program Development), abbreviated SAP.[1] The founders sought to create standardized software for real-time data processing, moving beyond batch methods, with initial headquarters in Weinheim, Germany, and an office in Mannheim.[2] Early efforts produced integrated business applications, starting with a materials, information, and accounting system (MIAS) in 1972 for the German subsidiary of Imperial Chemical Industries (ICI).[2] In 1973, SAP launched its first financial accounting module (RF), laying the groundwork for SAP R/1, a real-time system with modular design for flexible enterprise resource management.[2] Unlike batch processing on mainframes, R/1 enabled immediate data handling. By 1974, the company had 40 reference customers, such as Burda and Linde, and added a purchasing module; in 1975, it introduced the materials management system (RM) and completed its first international installation in Switzerland.[2] SAP formalized as SAP GmbH in 1976, with 25 employees and DM 3.81 million in revenue.[2] Operations moved to Walldorf in 1977, where the company held its first customer events. In 1978, development of R/2 began—a second-generation mainframe system integrating finance, logistics, and human resources—as staff grew to 60. By 1980, with about 80 employees, SAP occupied its first dedicated building in Walldorf, though co-founder Claus Wellenreuther left that year.[2][1] These innovations established SAP as a leader in real-time enterprise software, setting the stage for 1980s expansion.[2]Global Expansion and Standardization
SAP's initial foray into international markets occurred in 1975, when it installed its software for the first time outside Germany at Swiss customers Coop and Georg Fischer, marking the beginning of its global presence.[1] By 1982, over 250 companies in Austria, Germany, and Switzerland deployed SAP software.[3] This European focus expanded with the establishment of its first international subsidiary, SAP (Schweiz) AG, and SAP (International) AG in Biel, Switzerland, in 1984, aimed at boosting sales abroad.[3] The late 1980s saw accelerated expansion, with subsidiaries opened in Austria (1986), followed by France, the Netherlands, Spain, and the United Kingdom (1987), and Denmark, Italy, Sweden, and the United States (1988).[3] In 1989, SAP entered Asia with a subsidiary in Singapore, alongside outposts in Australia and Canada, managing 12 international subsidiaries through SAP (International) AG; revenues approached DM370 million across 15 countries that year.[3] By 1991, SAP had customers in 31 countries and 14 international subsidiaries, with operations extending to China (Beijing, Shanghai, Tianjin) and Latin America (Mexico City subsidiary) by 1994.[4] The launch of SAP R/3 in 1992 was pivotal for both expansion and standardization, as its client-server architecture enabled scalable, multiplatform deployment, supporting standardized business processes across global enterprises and smoothing integration into a globalized economy.[1] R/3's modular design, initially prototyped for financial accounting and materials management on UNIX systems, promoted uniform ERP practices by emphasizing configurable best-of-breed processes over bespoke customizations, facilitating multinational consistency in operations like supply chain and finance.[3] This propelled rapid adoption, with major clients such as IBM running global operations on R/3 by 1994 (its largest contract at the time), Coca-Cola implementing it in 1996, and 81% of 1997 revenues (DM6.02 billion) derived from outside Germany; by 2000, SAP operated in over 50 countries with a workforce exceeding 24,000.[4]Shift to Cloud and Digital Innovation
In the mid-2010s, SAP shifted from on-premise ERP systems to cloud-native architectures to improve scalability, real-time analytics, and IT efficiency. The launch of SAP S/4HANA on February 3, 2015, at the New York Stock Exchange marked a key milestone, offering an ERP suite powered by the in-memory SAP HANA database. This design removed redundant aggregate tables from systems like ECC, enabling instant data processing in finance, supply chain, and operations.[5] The change countered criticisms of legacy software's rigidity and costs, helping SAP compete with cloud providers like Salesforce and Workday.[6] SAP extended S/4HANA to cloud editions, starting with public cloud access in March 2016 for subscription-based updates without hardware needs.[7] By 2021, the RISE with SAP program bundled S/4HANA Cloud, process intelligence, and infrastructure from partners like AWS and Microsoft Azure to aid migrations from ECC, which ends support in 2027.[8] This reflected a move from on-premise dominance—over 90% of installations—to hybrid and public cloud models, driven by needs for remote access and API integrations. Cloud revenue rose from a small share in 2015 to 58% of total sales by Q3 2025, with 27% year-over-year growth in that quarter contributing to €9.01 billion overall.[9] [10] SAP also integrated advanced technologies into its applications for digital innovation, including machine learning and AI for predictive analytics and automation. SAP Leonardo, launched around 2017, added IoT, blockchain, and big data tools for applications like supply chain traceability and fraud detection, with blockchain co-innovation for asset tracking.[11] Later, generative AI via the Joule copilot was embedded in S/4HANA and the Business Technology Platform for tasks such as contract analysis and demand forecasting, boosting S/4HANA Cloud growth over 90% in years like 2022.[12] These features met demands for intelligent automation, though challenges included data privacy and legacy system integration.[13]Corporate Structure and Governance
Leadership and Organizational Hierarchy
SAP SE follows a two-tier governance structure under German law, featuring an Executive Board for operations and strategy execution, overseen by a Supervisory Board that appoints, supervises, and advises it.[14] The Executive Board consists of six members as of 2025 and is led by CEO Christian Klein, who directs overall strategy, financial performance, and global operations.[15] Klein joined the board in 2018, served as co-CEO from October 2019, and became sole CEO in April 2020.[16] Other board members include Muhammad Alam (Product & Engineering); Dominik Asam (Chief Financial Officer since 2024); Thomas Saueressig (Technology & Innovation); Sebastian Steinhaeuser (Customer Operations); and Gina Vargiu-Breuer (Human Resources, Sustainability, Real Estate).[17] In January 2025, SAP created an Extended Executive Board to advance AI-first and suite-first priorities, adding leaders from areas like Strategy & Operations who report to Klein but lack voting rights.[18] This setup centralizes decisions while delegating across regions, product lines, and units such as cloud services and analytics. The Supervisory Board, comprising 16 members including employee representatives, reviews Executive Board reports on performance, risk management, and compliance.[19] Chaired by Pekka Ala-Pietilä since 2021, with Lars Lamadé as deputy and independents like Aicha Evans and Prof. Dr. Ralf Herbrich, it balances shareholder needs with strategic guidance and has approved investments in cloud migration and AI since 2020 to support long-term innovation.[19][14]Ownership and Shareholder Dynamics
SAP SE maintains a stable, dispersed ownership structure with a free float of 83.8% as of December 31, 2024, excluding treasury stock and strategic investments.[20] Its total issued share capital consists of 1,228,504,232 no-par value shares.[20] This high free float reflects consistent broad participation by institutional and public investors, without dominant controlling interests.[21] Founding shareholders and affiliates hold approximately 12-15% through direct and indirect stakes, aligning with long-term governance and innovation goals. Hasso Plattner, co-founder and chairman emeritus, owns about 6.2% (76 million shares) as of early 2024. Dietmar Hopp, another co-founder, holds 5.33% personally (62,103,267 shares), plus 5.37% (62,548,065 shares) via Dietmar Hopp Stiftung GmbH, totaling over 10%.[22] Periodic sales have occurred, such as Plattner's partial divestment of up to 60% of a 1.46 million share block in 2023.[23] Institutional investors lead the free float, with BlackRock, Inc. at 6.92% (80,647,548 shares), followed by The Vanguard Group and Capital Research & Management Co.[22][24] Overall institutional ownership stands at 6-7%, indicating diversified global exposure without concentrated activist influence.[25] Dynamics remain subdued, with minor insider transactions—like 2,358 shares sold by Lars Lamade in April 2025—having negligible impact.[26] SAP's dividend policy includes a proposed €2.35 per share for fiscal 2024 (up €0.15), bolstering shareholder value alongside over 40% total shareholder return in the past year.[27][28] This balance ensures predictability, absent contentious proxy battles or ownership challenges in recent filings.Products and Solutions
Core Enterprise Resource Planning Systems
SAP's core enterprise resource planning (ERP) systems integrate finance, human resources, manufacturing, supply chain, and procurement into a unified platform for real-time operational management.[29] Originating from financial and inventory modules in the 1970s, these systems evolved into comprehensive ERP solutions that standardized enterprise data processing.[1] The foundational system, SAP R/3, launched on July 6, 1992, with a client-server architecture enabling multi-platform compatibility, real-time processing, and scalability beyond the mainframe limits of predecessors like R/2.[1] It supported modular applications for logistics, finance, and human resources, gaining rapid adoption through global standardization and exceeding 1,000 installations shortly after release.[1] R/3 established SAP's ERP dominance, with enhancements continuing via versions like R/3 Enterprise into the mid-2000s.[1] SAP ERP, extending R/3, reached version 6.0 in 2006, incorporating service-oriented architecture for improved integration and flexibility; its final enhancement arrived in 2016.[1] The current core, SAP S/4HANA, debuted February 3, 2015, optimized for the in-memory SAP HANA database to eliminate aggregate tables and simplify data models for accelerated analytics and decisions.[5] S/4HANA delivers real-time transactions and insights, with embedded AI supporting automation, predictive analytics, and optimization in finance, sales, and supply chain modules.[29] S/4HANA offers on-premises, public cloud, and private cloud deployments, including a 2025 private edition focused on seamless data integration and AI-driven governance.[30] As SAP's digital core, it manages end-to-end operations for over 25,000 customers, cutting complexity by up to 50% versus legacy ECC systems via intelligent technologies and preconfigured industry processes.[29] ECC maintenance ends in 2027, prompting migrations to S/4HANA for ongoing innovation.[1]Cloud-Based and SaaS Offerings
SAP accelerated its shift to cloud-based and SaaS models in the late 2000s, launching SAP Business ByDesign in 2007—a fully hosted, multi-tenant ERP aimed at midmarket companies.[31] Adoption grew substantially in the 2010s through acquisitions such as SuccessFactors in 2011 for human capital management and Ariba in 2012 for procurement, alongside native cloud developments. By 2021, RISE with SAP bundled ERP, database, and infrastructure services to support hybrid and full-cloud deployments.[32] Central to SAP's SaaS offerings is SAP S/4HANA Cloud, a next-generation ERP system on the in-memory HANA database. Announced in February 2015 and released in cloud edition by May, it enables real-time analytics, simplified data models, and automated processes in finance, supply chain, and sales.[33] The public edition provides multi-tenant SaaS with biannual updates, embedded AI, machine learning, and industry extensions, reducing customization compared to on-premises versions.[34] SAP SuccessFactors delivers cloud HR management, covering core HR, talent acquisition, performance, and payroll for over 100 million users via web and mobile.[35][36] SAP Ariba handles end-to-end procurement, linking buyers and suppliers in a network processing trillions in annual transactions, with AI insights for sourcing, contracts, invoicing, and compliance.[37][38] SAP Concur, acquired in 2014, manages expenses and travel, integrating with ERP for real-time compliance and analytics. These solutions feature subscription pricing, scalability, and integration via SAP's Business Technology Platform, though critics highlight higher migration costs from legacy systems and ecosystem dependency. As of 2024, cloud revenue represents a growing share of SAP's business, emphasizing agility over perpetual licenses.[39][40][31]Analytics, AI, and Industry-Specific Modules
SAP Analytics Cloud, launched in November 2015 as SAP Cloud for Analytics, unifies business intelligence, planning, and predictive analytics in a cloud platform.[41] It enables data visualization, augmented analytics, and collaborative planning, with quarterly updates adding AI-driven insights and integration with SAP Datasphere for data management.[42] These features support real-time analytics and scenario modeling on large datasets, forecasting outcomes from historical patterns with minimal custom coding.[43] SAP embeds artificial intelligence, including machine learning and generative AI, via SAP Business AI in processes like demand forecasting and anomaly detection within SAP S/4HANA.[44] Joule, an AI copilot announced in May 2024, aids users across applications by querying data, automating workflows, and delivering insights through natural language interfaces tailored to enterprise contexts.[45] [46] SAP AI Core manages AI model lifecycles, from training to deployment on the Business Technology Platform, enabling automated procurement via ML-analyzed transactions.[47] SAP offers over 27 industry-specific solutions extending its ERP core, addressing needs like regulatory compliance in healthcare and supply chain optimization in manufacturing with embedded AI for predictive maintenance and customer personalization.[48] Examples include SAP for Retail's demand-sensing for inventory management and oil, gas, and energy solutions integrating IoT for asset analytics.[49] SAP also hosts annual Aerospace & Defense Innovation Days events to showcase innovations for the sector, with the 10th edition held March 31–April 2, 2025, at the Omni San Diego Hotel in San Diego, California, and the 11th scheduled for March 9–11, 2026, at the JW Marriott Marco Island Beach Resort in Marco Island, Florida.[50][51] In S/4HANA, extensions customize processes, such as batch traceability and quality management in life sciences, using real-time data to reduce compliance risks without core modifications.[52]Acquisitions and Strategic Growth
Major Historical Acquisitions
SAP's strategy of acquisitions has been instrumental in expanding its capabilities beyond core ERP systems into analytics, mobility, human capital management, procurement, and cloud services, with several multi-billion-dollar deals marking pivotal shifts in the company's portfolio during the 2000s and early 2010s.[1] These moves addressed gaps in organic development, particularly in emerging technologies like business intelligence and SaaS, enabling SAP to compete more effectively in diversified enterprise software markets.[53] In 2008, SAP completed the acquisition of Business Objects, a leading provider of business intelligence and enterprise performance management software, which positioned SAP as a market leader in these areas and integrated advanced reporting tools into its ecosystem.[53] The deal, announced in October 2007 for approximately €4.8 billion (about $6.8 billion), represented one of SAP's largest early investments in analytics capabilities.[54] [55] The 2010 acquisition of Sybase for $5.8 billion enhanced SAP's mobile and database technologies, allowing it to extend business applications to mobile users and strengthen in-memory computing foundations that later supported innovations like SAP HANA.[53] SAP acquired SuccessFactors at the end of 2011 for €2.5 billion (approximately $3.4 billion), gaining a cloud-based human capital management platform that accelerated its transition to SaaS offerings and expanded its human resources software footprint.[8] [56] In 2012, SAP purchased Ariba for $4.3 billion, incorporating a cloud-based supplier network and procurement solutions that bolstered its business-to-business e-commerce and end-to-end spend management capabilities.[8] [57] The 2014 acquisition of Concur for $8.3 billion, SAP's largest to date at the time, integrated travel and expense management into its portfolio, targeting the $1.2 trillion business travel market and reinforcing its business network strategy.[8]| Acquisition | Date Completed | Cost (USD) | Key Focus Area |
|---|---|---|---|
| Business Objects | 2008 | ~$6.8B | Business intelligence |
| Sybase | 2010 | $5.8B | Mobility and databases |
| SuccessFactors | 2011 | ~$3.4B | Cloud HCM |
| Ariba | 2012 | $4.3B | Procurement and supplier networks |
| Concur | 2014 | $8.3B | Travel and expense management |
Recent Acquisitions and Their Impacts
In 2023, SAP acquired LeanIX, a provider of enterprise architecture management software, to strengthen business process modeling and IT landscape visualization.[58] This integrated LeanIX's capabilities with SAP Signavio, aiding alignment of IT strategies with business goals via improved data governance and transformation planning.[59] The acquisition advanced SAP's intelligent enterprise architectures, despite challenges in aligning LeanIX's agile tools with SAP's ERP ecosystem.[60] SAP acquired WalkMe, a digital adoption platform, on September 12, 2024, for about $1.5 billion.[61] WalkMe's in-app guidance and analytics reduce onboarding times and enhance adoption of SAP's cloud solutions, such as S/4HANA.[59] Early integration into SuccessFactors showed potential productivity gains of up to 30% in pilots, though full benefits hinge on API compatibility and data privacy adherence.[62] On September 12, 2025, SAP completed its acquisition of SmartRecruiters, an AI-driven talent acquisition platform announced in August 2025.[63] This expanded SAP's human capital management by adding machine learning for candidate sourcing and workflows, integrating with SuccessFactors to optimize talent processes.[64] It targets tech talent shortages with predictive hiring and cross-selling to SAP's customer base, balancing innovation gains against risks of cultural integration between startup and enterprise operations.[65] These moves have boosted SAP's cloud HR and analytics revenue by 15-20% year-over-year in key areas, enhancing competitiveness against Oracle and Workday through focused innovation.[60]Research, Development, and Innovation
R&D Investments and Global Labs
SAP allocates a substantial portion of its budget to research and development, with expenses reaching €6,514 million in 2024, marking a 3% increase from €6,324 million in 2023.[66] This represented 19.1% of total revenue under IFRS accounting, down from 20.3% the previous year, reflecting a strategic emphasis on innovation amid revenue growth.[67] The company's R&D efforts employ approximately 37,909 full-time equivalents as of September 2025, focusing on advancements in cloud computing, AI, and enterprise analytics.[68] The SAP Labs Network forms the backbone of these activities, encompassing major global research and development hubs across more than 20 countries and accounting for over 80% of SAP's worldwide development workforce.[69] Primary locations include the headquarters in Walldorf, Germany; development centers in Munich, Germany; multiple sites in the United States such as Palo Alto, California, and San Francisco; Bengaluru and Hyderabad in India; Montreal, Waterloo, and Vancouver in Canada; Ra'anana in Israel; and facilities in China.[70][71] These labs collaborate on product engineering, with India serving as one of the largest centers for global product distribution.[69] In August 2025, SAP announced an investment exceeding €150 million to establish a new R&D hub in Ho Chi Minh City, Vietnam, aimed at enhancing capabilities in AI, supply chain technologies, and regional innovation, joining its Southeast Asian operations.[72] This expansion underscores SAP's strategy to tap into emerging talent pools while maintaining a decentralized model that leverages local expertise for global software solutions.[73]Key Technological Breakthroughs
SAP R/3, released in 1992, advanced enterprise resource planning with a client-server architecture enabling real-time data processing across platforms and global standardization of business processes.[4][7] Unlike mainframe-based R/2, it supported modular, scalable integrations of functions like finance, logistics, and human resources, aiding multinational operations and minimizing data silos.[74] SAP HANA, an in-memory database platform, debuted for customers in late 2010 and widely in 2011.[75] Its columnar storage and in-memory processing enabled real-time analytics and transaction processing, accelerating data analysis from weeks to seconds by bypassing disk I/O.[76] This foundation powered later applications with predictive modeling and operational intelligence, obviating separate data warehouses.[77] Launched February 3, 2015, SAP S/4HANA embedded HANA into ERP, simplifying data models via structures like the Universal Journal for unified financial reporting. It featured embedded analytics for instant insights, removed aggregate tables for quicker queries, and introduced SAP Fiori for role-based interfaces.[78] These reduced deployment complexity, sped decision-making, and enabled intelligent automation, establishing S/4HANA as a digital transformation ERP.[78]Financial Performance
Revenue Trends and Profitability
SAP's revenue has shown steady growth over the past decade, accelerating due to the shift to cloud-based offerings since 2020. Annual revenue reached €31.2 billion in 2023 and €33.8 billion in 2024, yielding a compound annual growth rate of 4-5% from 2020 amid supply chain disruptions and inflation.[79] Growth strengthened in 2025, with first-nine-months revenue at €26.5 billion (up 9% year-over-year), driven by 25% cloud revenue growth to €14.2 billion.[80] Cloud backlog reached €18.84 billion as of September 2025 (up 27% at constant currencies), indicating strong future potential from subscriptions.[10]| Year | Total Revenue (€ billion) | Cloud Revenue Growth (YoY %) | Notes |
|---|---|---|---|
| 2020 | 27.3 | N/A | Pre-cloud acceleration baseline.[81] |
| 2021 | 27.8 | ~10 | Initial pandemic recovery.[82] |
| 2022 | 31.2 | 15 | Hybrid model expansion.[83] |
| 2023 | 31.2 | 20 | Stagnant total due to license decline offset by cloud.[79] |
| 2024 | 33.8 | 25 | Cloud overtakes legacy segments.[82] |
| 2025 (proj.) | 36-37 | 21-22 (full year est.) | Low-end cloud guidance amid trade uncertainties.[84][85] |