SAP Takes a Beating

After soaring in the cloud age, SAP is now taking a beating in the stock market and from analysts. What used to be true for Red Bull and SAP—that their offerings gave them wings—has turned into the opposite due to strategic mistakes and management decisions. Soccer, Formula 1, and the cloud are in crisis mode—SAP customer Red Bull and SAP itself are taking a beating.

Nicolas Ebert wrote in the Wall Street Journal: "Europe's software giants caught in a downward spiral!" SAP currently has no answer to the AI revolution, just as Red Bull has no answer to McLaren's superiority. Despite its excellent starting position, SAP was unable to develop its own large-scale B2B language model (LLM). SAP had the data and money, as well as two acquisitions, Signavio and LeanIX, that would have been capable of doing so in terms of process design and data expertise. However, SAP has been singularly focused on the cloud.

AI models

Powerful new AI models are causing concern in the financial and analyst communities. These models could put pressure on industries such as software, data analysis, and financial services faster than the SAP community had expected.

In Handelsblatt, a German business magazine, Thomas Jahn and Christof Kerkmann write that this fear has been around for some time. AI models are putting software values under pressure. At the beginning of August, OpenAI presented its new GPT-5 model, which shows a significant increase in performance compared to previous versions. Anthropic had previously published a version of its Claude model tailored to financial services. Handelsblatt Online reports: "SAP lost more than twelve billion dollars in value on the stock market in two days, while Salesforce lost almost ten billion dollars and Monday.com lost 4.6 billion dollars—all while the Nasdaq tech index and other stock market barometers reached a new high." This dichotomy has raised serious concerns among investors: AI could undermine the business model of certain software providers."

Artificial intelligence has destructive power. Why not use Lovable and a few AI agents to build a new, composable ERP based on SAP BTP and BDC? SAP could face challenges in the cloud with traditional Abap ERP and AI. With Lovable and other AI tools, large numbers of AI agents can be created quickly. Fast, large-scale AI production could replace the traditional programming of comprehensive ERP solutions. However, when using AI agents from different sources, such as SAP, UiPath, ServiceNow, Workday, Boomi, and Salesforce, the question of the leading system quickly arises.

The autonomy of AI agents raises the question of which stable platform the agents should operate on. With the (BTP Business Technology Platform) and the BDC (Business Data Cloud), SAP is in a good starting position. However, BTP and BDC do not offer SAP any unique selling points. Many of these SAP platforms' functions can also be found in hyperscalers or specialist providers, such as Boomi. BDC is essentially based on the concept of Databricks, a US IT company that collaborates with many other IT companies.

Open Source

The transformation of the formerly closed and homogeneous ERP market into an open, partially open-source conglomerate is an inevitable consequence. Due to developments in the IT platform economy and AI agents, the term "composable ERP" is undergoing a significant re-evaluation. In an interview with the German news magazine Der Spiegel (29/2025), American researcher and former OpenAI employee Daniel Kokotajlo shared his theory that AI could soon surpass human capabilities and potentially turn against its creators. The stage has been set.

his disruption will be painful and difficult. Harvard professor Clayton M. Christensen (1952-2020) aptly described this phenomenon in his book The Innovator's Dilemma: "If a company tries to develop a disruptive technology to the point where it meets the needs of customers in established markets—which most leading companies do—it is almost certain to fail."

Reinforcement learning in AI can analyze accounting and control systems and present SAP customers with a better perhaps license-free (open source) ERP system. LLMs will take over factories and logistics, and AI will pave the way for the next generation of ERP. AI disruption is definitely an innovator's dilemma. When will SAP shares no longer be worth anything? Strategic mistakes have been made. Protagonists such as Salesforce, Workday, Adobe, Capgemini, Red Bull, and SAP are taking a beating.