Cloud, HANA surge are a validation of our strategy, says SAP chief

Database giant says it now has 1,300 HANA customers, while cloud subscriptions have more than doubled.
Written by Steve Ranger, Global News Director
SAP's headquarters in Walldorf, Germany.
Image: SAP
SAP has reported strong third-quarter results fuelled by growth in cloud revenues and its SAP HANA database offering.

The German vendor, Europe's biggest software company, said third-quarter cloud subscriptions and support revenue grew 116 percent year on year to €600m, while new cloud bookings, the key measure for SAP's sales success in the cloud, doubled in the third quarter to €216m. All numbers are non-IFRS.

Cloud and software revenue increased 19 percent to €4.12bn, and operating profit increased 19 percent to €1.62bn.

SAP CEO Bill McDermott said the results were "the latest validation of our strategy". The company said it now has 800 customers for its SuccessFactors Employee Central HR system, which is an increase of 79 percent in 12 months, and said new cloud bookings for its Customer Engagement and Commerce packages "saw strong double-digit growth".

And it said adoption of its SAP HANA "continues to surge" with more than 1,300 SAP customers onboard by the end of the third quarter across all industries and regions, noting that the in-memory database offering "enabled strong growth across its portfolio".

"The HANA database and platform are the foundation for a 'live-system strategy' enabling companies to capture the immense Internet of Things opportunity," McDermott said.

Total revenue in its SAP Business Network segment was €412m in the third quarter, a year-over-year increase of 159 percent. SAP said Concur's new business momentum has seen a "significant increase" since the acquisition.

The company said about 1.9 million companies are trading over $730bn on its Ariba network, while roughly 30 million end users process travel and expenses with Concur, and 1.7 million flexible workers are managed with the Fieldglass platform.

In terms of regional performance, EMEA saw a 13 percent increase in cloud and software revenue, while cloud subscriptions and support revenue grew by 67 percent, with "high double-digit growth" in new cloud bookings.

In SAP's Americas region, cloud and software revenue rose 32 percent, cloud subscriptions and support revenue in the region grew 139 percent, while new cloud bookings rose "by triple digits".

Based on what it described as "the strong momentum" in its cloud business, the company expects its 2015 non-IFRS cloud subscriptions and support revenue to be in the range of €1.95 to €2.05bn: the upper end of this range would represent a growth rate of 86 percent.

SAP predicts that 2015 cloud and software revenue will increase by between eight and 10 percent, and expects 2015 operating profit to be in the range of €5.6bn to €5.9bn, compared with €5.64bn in 2014.

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