SAP becomes Europe’s most valuable firm amid German stock boom

Software-maker SAP became Europe’s most valuable company this week, riding a wave of artificial intelligence enthusiasm and German stock market gains.

The company had a market capitalization of around $342.4 billion by Monday’s close, according to FactSet data, with shares up 1.16% on the day and up more than 40% over the last year.

SAP, which offers corporate products across cloud solutions, expenses, supply chain management and analytics, is widely seen delivering greater revenue as it taps its large customer base and wealth of business data to create opportunities from AI.

Bank of America’s analysts earlier this month reiterated SAP as its top large cap software pick for 2025, spying “further upside to street expectations on upsell including from AI.” The analysts also said business cloud migration remained in the “early stage” and would continue in recent years.

The company early last year embarked on a major restructure focusing the business on AI opportunities, and reported cloud revenue up 25% year-on-year in 2024.

CEO Christian Klein previously told CNBC it was the “best year in SAP’s history” with the company’s cloud backlog at 63.3 billion euros ($68.5 billion) in 2024.

“We are sitting on a very rich set of business data, HR data, finance data, supply chain data, sales data” from 40,000 customers, Klein said in January, calling this the “richest business data set of all tech companies.”

Through AI tools, SAP is allowing different departments such as sales, supply chains and procurements to access a high degree of automation, Klein continued, while itself remaining “agnostic to any kind of any large language model” — the form of AI which uses huge data sets to perform various tasks.

Dominik Asam, the company’s chief financial officer, told CNBC in January that the AI tool launched by Chinese startup DeepSeek which rocked financial markets earlier this year was “good news” for SAP.

German markets are meanwhile on a bull run this year, with the blue-chip DAX index up nearly 16% in the year to date — far outpacing European peers such as the FTSE 100, up around 6.6%, and France’s CAC 40, up around 9.91%.

Sentiment has been buoyed by a large fiscal package approved by German lawmakers this month enabling hundreds of billions of government spending on infrastructure, climate projects and defense.

SAP takes the spot as Europe’s most valuable company from Novo Nordisk, the Danish pharmaceutical giant known for weight management drugs Ozempic and Wegovy. After a period of intense hype, Novo has struggled in recent months with intense market competition and investor skepticism over its future product line. The company’s market capitalization was around $332 billion on Monday, Factset data showed.

French luxury group LVMH, which was dethroned from Europe’s top spot by Novo Nordisk in late 2023, has also seen shares decline this year on jitters over luxury sector demand.

— CNBC’s Karen Gilchrist contributed to this story