- SAP cuts travel expenses to refocus on AI-related hiring
- The company’s shares have fallen 46% in 12 months due to software problems
- Redeployment of existing employees is a priority over the dismissal of more employees
SAP is reportedly overhauling how it spends to free up more cash for its AI strategy, with a new internal memo seen by Bloomberg apparently confirming the company’s intentions to limit new hires, pause internal travel and reduce other expenses related to suppliers.
It is believed that the company will still continue to hire across certain AI roles, showing a shift towards AI engineers, researchers and other specialists, but other roles are likely to see a slowdown or pause.
The company told employees that AI is reshaping enterprise software, so targeting investments would be critical to keep it competitive in the long term.
SAP redirects internal spending to focus on AI
According to the report, citing an internal email, corporate travel unrelated to AI projects and customer relations has been suspended. The company also wants to reassign existing employees to fill new gaps instead of firing and rehiring. SAP laid off around 12,000 employees between 2023 and 2024.
“We are prioritizing investments in AI-related capabilities, talent and technologies while applying greater discipline to hiring, external spending and internal travel,” a company spokesperson said.
“I don’t expect to work with a smaller workforce, but with a very, very different workforce,” CEO Christian Klein had previously told New York time (via Investing.com), suggesting that jobs will continue to grow.
Despite a 6% rise in revenue in the latest quarter, SAP shares have fallen about 46% over the past 12 months on concerns that the software business may face longevity amid the ongoing AI boom.
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