Why are SAP shares falling sharply?

SAP shares are falling due to widespread fears of AI disruption impacting software stocks, leading to a significant drop in market value.

What is the impact of AI on SAP's services?

AI could make software development easier to replicate, potentially lowering the average selling price of SAP's services and billable hours.

When will SAP report its next financial results?

SAP is scheduled to report its financial results next week.

Home / Business and Economy / SAP Stock Plunges Amid AI Disruption Fears

SAP Stock Plunges Amid AI Disruption Fears

22 Jan

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Summary

SAP shares hit their lowest point since August 2024.
The company's market value has declined by approximately $130 billion.
Analysts suggest SAP must accelerate its cloud transition to mitigate risks.

SAP Stock Plunges Amid AI Disruption Fears

Shares of German software giant SAP have fallen to their lowest point since August 2024, continuing a months-long downtrend. This slide has eroded approximately $130 billion in market value since the company's record high in February 2025. The selloff is part of a wider market correction affecting software stocks in Europe and the United States, driven by growing apprehension over artificial intelligence potentially disrupting established business models.

Market watchers note that while SAP's fundamental future isn't in question, the valuation of its services faces pressure. Analysts suggest that AI could simplify the development and replication of software modules, potentially leading to lower average selling prices for services and reduced billable hours. SAP, which previously forecast full-year cloud revenue at the lower end of its guidance in October, is scheduled to announce its latest results next week.