SAP reports strong financial results in Q2 of 2018

July 20, 2018

 

 

SAP announced strong financial results for Q2 of 2018. These results are driven by more and more cloud growth as companies switch to SAP HANA and SAP S/4HANA. Approyo has also seen much growth over the year with SAP S/4HANA and SAP HANA migrations leading the way. Plus, Approyo was recently named named one of the 30 Most Valuable Tech Titans of 2018 by Insights Success. Here is an overview of the results from SAP.com. 

 

  • Cloud Revenue Growth Accelerates, Up 30% (IFRS) and Up 40% (Non-IFRS at Constant Currencies), Outpacing Competition

  • New Cloud Bookings Up 29% at Constant Currencies on Top of a Strong Prior Year Quarter

  • Strong Digital Core Innovation Cycle – 600 S/4HANA Customers Added in Q2, S/4HANA Customer Count Now Close to 9,000  Double-Digit Operating Profit Growth Continues, Up 13% (IFRS) and Up 12% (Non-IFRS at Constant Currencies)

 

SAP S/4HANA 
With SAP’s next generation ERP S/4HANA, customers can massively simplify their IT landscape, turn real-time data into actions and reinvent their business models for the digital economy across every industry. 


SAP S/4HANA adoption grew to more than 8,900 customers, up 41% year over year. In the second quarter, approximately 600 additional customers signed up of which approximately 40% were net new.  

 

SAP Leonardo 
With SAP Leonardo, SAP delivers powerful innovation by bringing together deep process and industry expertise, advanced design thinking methodology and cutting edge software capabilities such as IoT, Big Data, Machine Learning, Analytics, and Blockchain. 

 

Regional Revenue Performance in the Second Quarter 2018 
SAP had a very strong performance in the EMEA region with cloud and software revenue increasing 10% (IFRS) and 12% (non-IFRS at constant currencies). Cloud subscriptions and support revenue was strong and grew by 40% (IFRS) and 46% (non-IFRS at constant currencies) with Germany and the UK being highlights. In addition, SAP had strong double-digit software revenue growth in the UK, and the Middle East and Germany had another strong software revenue quarter with solid single digit growth. 


The Company had a solid performance in the Americas region with a significant currency headwind. Cloud and software revenue decreased by 3% (IFRS) and increased by 8% (non-IFRS at constant currencies). Cloud subscriptions and support revenue increased by 24% (IFRS) and 35% (non-IFRS at constant currencies) with Brazil being a highlight. 


In the APJ region, SAP had a strong performance. Cloud and software revenue was up by 4% (IFRS) and grew by 11% (non-IFRS at constant currencies). Cloud subscriptions and support revenue was exceptional and grew by 42% (IFRS) and 52% (non-IFRS at constant currencies) with China and Japan being highlights. For software revenue, Australia, China and India had impressive quarters and grew by double digits. 

 

Ambition 2020 
Looking beyond 2018, SAP is updating its 2020 ambition. This update reflects the strong momentum in SAP’s cloud business, the acquisition of Callidus Software as well as a more challenging currency environment compared to 2017.  
 
SAP now expects 2020 non-IFRS cloud subscriptions and support revenue in a range of €8.2 to €8.7 billion (previously: €8.0 to €8.5 billion). 
 
SAP continues to expect:  

 

  • €28 to €29 billion non-IFRS total revenue

  • €8.5 to €9.0 billion non-IFRS operating profit

  • The share of more predictable revenue (defined as the total of cloud subscriptions & support revenue and software support revenue) in a range of 70% to 75%

 

 

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