SAP, and Oracle, and IBM, oh my! ‘Cloud and AI’ drive legacy software firms to record valuations

Legacy software firms like SAP, Oracle, and IBM are thriving due to the adoption of cloud and AI technologies, achieving record valuations.

: Legacy software firms such as SAP, Oracle, and IBM have achieved record valuations driven by cloud and AI adoption. SAP saw a 50% market cap increase in the past year, while Oracle's AI-fueled cloud growth has set new milestones. IBM's cloud journey and AI investments have also boosted its path, attracting positive investor sentiment.

Legacy software firms like SAP, Oracle, and IBM are experiencing a surge in valuations due to their transitions to cloud computing and AI integration. SAP's valuation has increased by over 50% in the past year, reaching $234 billion, mainly attributed to its cloud revenue growth and AI business suite.

Oracle has seen a 20% increase in valuation, surpassing its total license support revenue with cloud-specific revenue growing by 20%. Partnerships with major tech players such as Microsoft, Google, and OpenAI have fueled this growth, alongside its AI infrastructure initiatives.

Despite a slight dip, IBM's valuation remains 30% up from last year, supported by its strategic AI investments like Watsonx and cloud services. Goldman Sachs has given IBM a 'buy' rating, indicating confidence in its ongoing transition to modern application and infrastructure software.