SAP tightens hiring, travel spend as it ramps up AI investments

German software major SAP is tightening hiring, travel and third-party spending as it steps up investments in artificial intelligence, according to an internal email sent to employees, according to a Shilpa Phadnis’ TOI report.

In the email, SAP said the rapid pace of AI adoption is driving significant investments in AI products, strategic acquisitions and the infrastructure needed to support AI workloads. The company also pointed to rising token consumption and related costs as more AI-powered applications are deployed internally and for customers.

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"As AI reshapes the future of our industry, we are making significant investments in the products and AI capabilities we build, complemented by strategic acquisitions in data and AI where we need additional expertise and technology," the company said in the email to employees.

"We are also investing in how we consume AI across SAP, with token usage and related costs increasing as more AI-driven scenarios go live," it added.

To fund these priorities, SAP said it will "exclusively focus new hiring on selected profiles only," primarily core AI roles critical to its long-term strategy.

The company is also evaluating further reductions in third-party spending, saying AI is making both suppliers and internal teams more efficient. As part of the effort, SAP will reintroduce its Spend Council process through its procurement organisation to tighten oversight of external spending.

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SAP is also pausing internal travel across the company. However, customer-facing travel, trips directly related to its "All in on AI" programme, and travel for mission-critical AI training for employees will continue.

(With inputs from TOI)