Shares of SAP SE (SAP) were gaining around 3 percent in German trading after the software giant reported Tuesday higher first-quarter profit with strong growth in cloud subscriptions and support revenues. The company further lifted its outlook for fiscal 2018.
Bill McDermott, CEO, said, “With an increasing share of predictable revenues, our beyond expectations profitability is cause for even greater shareholder confidence. From this position of immense strength, look for SAP to be bolder than ever in markets like CRM.”
For the first quarter, SAP’s profit after tax rose 33 percent to 708 million euros from last year’s 530 million euros. Earnings per basic share improved 37 percent to 0.59 euros from 0.43 euros in the previous year.
On non-IFRS basis, profit was 868 million euros or 0.73 euros per share, compared to 887 million euros or 0.73 euros a year ago.
Operating profit was up 52 percent year over year to 1.03 billion euros, while it grew 14 percent on non-IFRS basis at constant currencies.
Total revenue was 5.26 billion euros on IFRS basis, slightly lower than last year’s 5.29 billion euros. Revenues grew 9 percent on non-IFRS at constant currencies.
Cloud and software revenue grew 1 percent year over year to 4.35 billion euros. Cloud subscriptions and support revenue grew 18 percent year over year to 1.07 billion euros, while software revenue was down 10 percent to 625 million euros.
New cloud bookings of 245 million euros climbed 14 percent on a reported basis and 25 percent at constant currencies.
The total of cloud subscriptions & support revenue and software support revenue grew 2 percentage points to 71 percent of total revenues, exceeding 70 percent for the first time.
Looking ahead, SAP raised its 2018 outlook to reflect the closing of the Callidus acquisition on April 5, 2018 as well as the strong operating profit performance in the first quarter.
For the full year 2018, the company now expects non-IFRS cloud subscriptions and support revenue to be in a range of 4.95 billion euros – 5.15 billion euros at constant currencies, up 31 percent – 36.5 percent at constant currencies. The previous range was 4.8 billion euros – 5.0 billion euros. Callidus is expected to contribute about 150 million euros.
Non-IFRS cloud and software revenue is expected to be in a range of 20.85 billion euros – 21.25 billion euros, up 6.5 percent – 8.5 percent at constant currencies. The previous range was 20.7 billion euros – 21.1 billion euros.
Non-IFRS total revenue is expected to be in a range of 24.80 billion euros – 25.30 billion euros, up 5.5 percent – 7.5 percent at constant currencies. The previous range was 24.6 billion euros – 25.1 billion euros.
Non-IFRS operating profit is anticipated to be in a range of 7.35 billion euros – 7.50 billion euros, up 8.5 percent – 11 percent at constant currencies. The previous range was 7.3 billion euros – 7.5 billion euros. Callidus is expected to contribute approximately 10 million euros.
In Germany, SAP shares were trading at 90.17 euros, up 3.47 percent.
by RTTNews Staff Writer
Source: Read Full Article