SAP reported Monday fiscal first-quarter results that missed on both the top and bottom lines.

Still, SAP’s NYSE-listed shares (NYSE:SAP) rose 2.7% in premarket trading Tuesday.

For the three months ended Mar. 31, SAP reported adjusted earnings of €0.81 per share, missing the consensus estimate of €1.06 per share. Revenue came in at €8.04 billion, also below the €8.63 billion expected by analysts.

Cloud revenue jumped 24% to €3.93B in Q1 year on year.

The weaker results come despite a jump in cloud revenue as the company kicked off the implementation of its transformation program, strengthening its investments on the business AI opportunity.

However, analysts at Citi Research believe the print represents a “solid update against elevated expectation.”

“SAP delivered a solid overall update for Q1, characterized by continued underlying business momentum along with confident commentary on the drivers of future acceleration,” Citi analysts wrote.

“Increased restructuring cost and stock-based compensation expectations for 2024 vs. a robust FCF beat may drive small adjustments to the 2024 expectations,” they added.

The company reiterated its outlook for 2024, forecasting cloud revenue of €17.0B to 17.3B and adjusted operating between €7.6 and €7.9 billion.

SAP declared a dividend of €2.20 per share for fiscal year 2023, up 7% compared to the regular dividend paid for fiscal year 2022.

“On balance, we see the update meeting the elevated expectation bar, and expect shares to trade in line,” said Citi.

Meanwhile, UBS analysts reiterated a Buy rating on SAP, saying the bar for Q1 “was set quite high.” However, with strong growth in its current cloud backlog (CCB), gross margins and free cash flow (FCF), the software maker “has passed it,” they added.