STOCKHOLM, Oct 13 (Businesshala) – German business software group SAP (SAPG.DE) raised its full-year outlook for the third time for the third time on the back of strong performance in the third quarter as more customers move their IT operations to the cloud.
SAP now expects full-year cloud revenue to grow 16%-19%, driving its overall cloud and software revenue up 2%-4%, it said in a statement late Tuesday.
Operating profit for the year is expected to be flat below 2%, an improvement from its earlier forecast to an unchanged 4%.
SAP, which is moving from software licenses to subscription-based cloud services with up-front fees, in January launched Rise with SAP, an all-in-one digital transformation package.
“We see record adoption of our applications and our platform,” Chief Executive Officer Christian Klein said in a statement. “This has led to a sharp acceleration in our cloud growth.”
SAP raised its forecast for cloud and software revenue for the full year from €200 million to €23.8 billion–24.2 billion.
The cloud backlog for flagship database S/4HANA was up 58% in constant currencies and the current cloud backlog — a measure of business to come — posted 22% growth during the third quarter.
Adjusted revenue rose 5% to 6.68 billion euros ($7.70 billion) for the third quarter ended September 30, the company reported in a preliminary earnings statement. SAP is expected to release the full result on 21st October.
Adjusted earnings per share rose 2% to 1.74 euros, backed again by its profitable venture capital investment, Sapphire Ventures.
($1 = 0.8672 Euro)