JP Morgan’s preview of The Sage Group PLC (LSE:SGE) third-quarter figures suggests there won’t be fireworks when the software group reports on July 30.
Analysts there reckon the company will deliver roughly the same 9% year-on-year organic growth it achieved in the first half of its financial year, neither better nor worse.
Back in the first half (covering September to March), Sage grew total revenues by 9% once you strip out currency swings and acquisitions.
JP Morgan expects Q3 to mirror that performance, with the cloud-subscription side of the business climbing about 9.3%—a shade below the Street’s roughly 9.7% forecast, with the remainder of revenues holding up a little better than before.
In plain language, the steady businesses are doing a bit more of the heavy lifting while the subscription arm slightly lags consensus.
A similar story plays out on annual recurring revenue, or ARR, the subscription income Sage can count on each year.
ARR rose 10.1% in H1; JP Morgan models that slowing to about 9.9% in Q3, in line with peers such as Oracle’s NetSuite and Microsoft Dynamics.
That gradual easing means the upcoming results are unlikely to give Sage’s share price a boost.
That said, it’s not all flat news. Once the Q3 figures are behind us, investors will be looking for proof that Sage can lift margins and potentially kick off a fresh share buyback when it reports full-year results in early 2026.
Other positives could include the UK rollout of its Copilot AI assistant, deeper market penetration for Intacct (its US accounting platform), and further support from “Making Tax Digital” compliance rules here in Britain.
JPM has tweaked its profit forecasts down by just 1% for both 2025 and 2026, mainly to reflect currency movements.
It remains 'overweight' with a 1,500p price target. In afternoon trading, the stock was off almost 5% at 1,173p.