SAP's grand cloud escape plan €2B short of the runway
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SAP's RISE with SAP cloud migration strategy, launched in 2021 after a 2020 share price crash, is falling significantly short of its targets. On-premises software support revenue for 2025 came in at €10.5 billion — €2 billion higher than the €8.5 billion SAP had projected, indicating that far fewer customers have migrated to S/4HANA in the cloud than planned. Only 39% of SAP's 35,000 ECC customers had purchased licenses to begin their S/4HANA transition as of Q4 2024. Key barriers include a weak business case for migration, the complexity of removing ECC customizations for a 'clean core' approach, and economic uncertainty. Some large customers like Kingfisher have outright rejected the migration plan. SAP has since softened its stance on support deadlines and is now shifting focus toward upselling AI and innovation products — including its agentic AI platform Joule — to its legacy install base rather than purely pushing ERP modernization.
Table of contents
On-prem support revenue shows cloud migration behind scheduleBusiness case still a barrier for legacy usersECC users will migrate in the endSAP shifts focus from migration to 'innovation'Sort: