Rise in sales by 17% causes SAP to boost its 2012 forecast
In the third quarter of 2022, German software giant SAP reported a mixed bag of results, showcasing both growth and challenges. The company's revenues surged 17% year-on-year, reaching €3.95 billion, while its profit took a hit due to a court ruling in a lawsuit with Oracle.
SAP's co-CEOs, Bill McDermott and Jim Hagemann Snabe, expressed satisfaction with the company's overall performance, praising its relentless customer focus and confidence in continuing to outperform the competition. Werner Brandt, CFO of SAP, echoed these sentiments, expressing satisfaction with the company's performance in the quarter, marking the 11th consecutive quarter of double-digit non-IFRS software and software related service revenue growth for SAP.
One of SAP's key acquisitions, German cloud computing company Ariba, which was acquired for $4.3 billion in October 2021, contributed to the company's growth. Another significant acquisition, SuccessFactors, a cloud-based human capital management (HCM) provider, saw billings grow 92%. Revenue for SAP's in-memory database technology HANA reached €83 million and was also on track to meet expectations.
The demand for SAP's key innovation areas - cloud, mobile, and in-memory database platform HANA - was strong in all regions. SAP continued to invest in its cloud business during the quarter, with new cloud billings increasing 116% during the past 12 months. Cloud services gained momentum during the third quarter, positioning SAP well for future growth in this area.
SAP's mobile revenue for the third quarter was €48 million, putting the company on track to meet its full-year expectations of at least €220 million. The company's focus on operating discipline remains unwavering, and it is confident in its full-year outlook.
However, the US competitor Oracle negatively impacted SAP in the last financial quarter amid the weakening of the Euro. SAP’s shares fell despite Oracle’s strong figures, highlighting the challenges faced by multinational corporations in navigating currency fluctuations.
Despite these challenges, SAP expects revenue from its software and software-related services division to grow between 10.5% and 12.5% this year, an upward revision from the 10% to 12% outlook given in July. SAP remains focused on delivering world-class value and market-leading performance, as evidenced by its continued investment in innovation and customer-centric strategies.
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