German Software Giant SAP Continues To Grow

FRANKFURT, Jan 28 (Bernama-dpa) --  Europe's largest software maker, German-based SAP, on Tuesday, reported a fourth-quarter profit after tax from continuing operations of €1.6 billion (US$1.67 billion), up 35 per cent from the previous year, boosted by its cloud business, reported German news agency dpa.

The DAX heavyweight said that total year-on-year revenue rose by 11 per cent to €9.4 billion.

The Germany-based company again recorded a particularly strong increase in subscription contracts for its core software. Cloud ERP Suite revenue was up 33 per cent and up 34 per cent at constant currencies in 2024.

This year, SAP is again aiming for a significant increase in profits after last year's major job cuts. Adjusted for currency effects, operating profit is expected to increase by 26 per cent to 30 per cent, between €10.3 billion and €10.6 billion. 

With licence software and cloud contracts, management, led by chief executive Christian Klein, is targeting an increase of 11 per cent to 13 per cent, between €33.1 billion and €33.6 billion. 

In 2024, SAP was able to increase its total revenue by 10 per cent to €34.2 billion. However, at €3.15 billion, only around half of the profit from the previous year remained. SAP had spent several billion euros in one-time costs in 2024 to cut thousands of jobs.

"Looking at the full year, we exceeded our cloud goals, accelerating cloud revenue and current cloud backlog growth against a much larger base," Klein said. "Looking ahead, our strong position in data and Business AI gives us additional confidence that we will accelerate revenue growth through 2027."

"We are pleased with the strong close to 2024, where we exceeded our cloud and software revenue, non-IFRS operating profit, and free cash flow outlook," said chief financial officer Dominik Asam.

"With current cloud backlog growth of 29 per cent, we've demonstrated the strength of our strategy and our ability to deliver on our commitments."

-- BERNAMA-dpa