FRANKFURT (dpa-AFX) - Following a brief respite the previous day, SAP shares returned to the bottom of the Dax on Thursday, shedding 3.7 percent by mid-morning. The stock remains the index's worst performer year-to-date, with losses nearing 31 percent. The German benchmark index itself retreated 1.3 percent on Thursday.
The downturn for the Walldorf-based software giant began well before the outbreak of the Iran conflict in late February. Since hitting a record high of over 283 euros in February 2025, the shares have lost approximately half of their value.
The software sector is particularly sensitive to investor fears regarding displacement by Artificial Intelligence (AI). JPMorgan analyst Toby Ogg views comments made by CEO Christian Klein to the "Financial Times" as further evidence of the structural shifts within SAP's business model.
Klein has prepared investors for "short-term pain." While AI is not expected to replace enterprise software, it is forcing companies to significantly ramp up their efforts. Ogg noted that Klein drew a parallel between the current AI transformation and the migration to the cloud six years ago. At that time, the company also had to accept initially lower margins.
Ogg maintains that adapting the business model is the correct path to ensuring long-term relevance, even if it is likely to be accompanied by heightened volatility in the near term./ag/la/jha/
