SAP is coming out of the doldrums better than expected

Christian Klein is the sole head of SAP since April 2020.
Photo: dpa

The software company can reduce its losses. In the first half of the year, SAP would have posted an increase in profits had it not been for the effects of a disincentive currency. Services in the cloud are still required.

eSAP, uropa’s largest software maker, is raising its full-year forecast slightly after an unexpectedly strong second quarter. Working with software for use online (the cloud) has bounced back strongly and with traditional software licenses things haven’t gone down quite as well as experts think.

For special effects-adjusted EBIT, management led by CEO Christian Klein now assumes a currency-adjusted decline of up to 4 percent this year. At best, it should stagnate. So far, Al Waldorf has predicted a 1 to 6 percent decline. Also with revenue from the cloud and products as a whole, SAP is now a little more confident, DAX Group said Wednesday.

In the second quarter, total sales were 6.7 billion euros, 1% lower than the previous year’s figure. Adjusted operating profit, which fell 2 percent to 1.92 billion euros, was slightly better than analysts had expected. Without the effects of exchange rates, sales and operating profit increased 3 percent. Klein also noted strong growth in new contracts for the “Rise with SAP” cloud offering, particularly in the United States.

The bottom line is that SAP made €1.45 billion, nearly two-thirds more than the previous year. A decisive role in this was played by SAP’s investments in startups through venture capital firm Sapphire Ventures, which according to CFO Luka Mucic contributed 900 million euros to the financial result in the second quarter.

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