Strong cloud and software revenue growth sees SAP APAC revenue exceed €3b

SAP has reported that cloud and software revenue grew 20 percent during the 2015 financial year.
Written by Aimee Chanthadavong, Contributor

SAP has attributed strong growth in cloud and software revenue to helping the company's Asia-Pacific arm achieve record results for the fourth quarter and 2015 full year.

The company reported that for the full year ended December 31, 2015, revenue exceeded €3 billion (AU$4.6 billion), noting that non-international financial reporting standards (IFRS) cloud and software revenue grew by 20 percent, and cloud subscriptions increased by 99 percent.

SAP highlighted that its flagship product, S/4HANA, continued to accelerate "sharply", with more than 2,700 customers adopting the product by the end of 2015 -- more than double quarter over quarter.

In Q4 terms, SAP said non-IFRS cloud and software growth was 18 percent, while cloud subscriptions and support revenue grew 55 percent.

The company added that there was "exceptional momentum" in new cloud bookings in Q4, which grew by triple digits in the region.

"In Asia-Pacific Japan, our cloud revenues have been growing at an increasing rate. SAP HANA, the key enabler of our portfolio, saw double-digit growth and has become the real-time data platform of choice," said Adaire Fox-Martin, president of SAP Asia-Pacific.

"The combination of a fast-growing cloud business and a growing core puts us in a unique position to support customers in their journey to run simple, go digital, and compete in the digital economy."

The results reflect the company's preliminary full-year results announced in early January. The German software maker at the time said cloud computing yielded strong returns for 2015, with new cloud bookings growing by 103 percent for the full year.

It also follows strong third-quarter results reported in October last year, which were also fuelled by growth in cloud revenues and its SAP HANA database offering. At the time, the software company reported that cloud subscriptions and support revenue grew 116 percent year on year to €600 million, while new cloud bookings, the key measure for SAP's sales success in the cloud, doubled in the third quarter, to €216 million.

Over the last few years, the company has been revamping its flagship Business Suite to refocus the business towards delivering cloud-based software and applications rather than on-premises ERP solutions.

The ongoing focus on cloud by SAP forms part of the company's five-year outlook, which was outlined early last year. SAP believes its cloud computing business will equal the software unit in size by 2018, and will eventually help the company deliver better profits in 2020.

In fact, SAP revealed that the Australian and New Zealand market are leading the charge in cloud adoption, with ANZ managing director John Ruthven previously telling ZDNet the two countries are "punching above their weight".

"They push the envelope in terms of taking on new technologies and really driving trend. When you boil that down to cloud, if you look at one of the sectors many would regard as conservative regarding technology, the public sector has one of the big proponents of cloud, and one of our big customers in terms of cloud solutions," he said.

On Tuesday, SAP announced its partnership with Lenovo to develop enterprise cloud offerings in China. This will see a big push of the HANA database into the Chinese market.

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