TL;DR

Sage said it is accelerating the rollout of AI across its product lines as revenue rose 11% to £2.06bn in the nine months to 30 June, with third-quarter growth quickening to 12%. Cloud revenue climbed 15% to £1.76bn and recurring subscription revenue rose 11% to more than £2bn, now accounting for 84% of the total.

Chief financial officer Jacqui Cartin described “nine months of accelerating revenue growth” reflecting “focused execution as we deepen AI capabilities across our platform”. The company held its full-year guidance of more than 9% organic revenue growth and further operating margin improvement.

Regionally, North America remains the fastest-growing market at 14% growth to £932m. The UK and Ireland grew 10% to £602m and Europe 7% to £528m. Cloud-native products — built for the cloud rather than adapted from older software — grew 25% to £794m.

The market has not rewarded any of this. Sage shares sit around 13% below where they were a year ago, having come under pressure earlier this year alongside other software companies as investors questioned whether rapid model advances, following Anthropic’s recent launch, threaten established software providers. The concern is straightforward: if a capable general model can perform the work an application layer sells, the application layer’s pricing power erodes.

Looking Forward

Sage is one of the few UK-listed companies attaching AI to reported revenue rather than to narrative, which makes the gap between its numbers and its share price the interesting part. Double-digit growth with retention holding steady is not what disruption looks like in the accounts — yet the multiple says investors are pricing a threat the results have not yet shown. The tension will not resolve on a quarterly update. What would settle it is evidence on whether AI features raise revenue per customer or merely defend it, and Sage has not disclosed that split.