Cloud package: A new business transformation product

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Cloud package
Cloud package: A new business transformation product

With the Rise initiative driving a 19 per cent increase in its current cloud package backlog – a management measure of incoming business at constant currencies, SAP had “an absolute blowout in the cloud” in the first quarter

SAP AG – a German software group, on Thursday said that its new all-in cloud package was proving to be a hit with its customers, as it confirmed its first-quarter results and recently raised guidance.

“We are seeing very strong order entry growth across our applications portfolio”, said Christian Klein, CEO of the German firm. SAP’s new business transformation product, Rise with SAP, was “rapidly becoming a massive accelerator”.

The firm confirmed its guidance after earlier this month, nudging up expectations for the cloud package and software revenue to €23.4 to €23.8 billion ($28.15 to $28.64 billion) this year, representing a rise of 1 per cent to 2 per cent year-on-year.

With the Rise initiative driving a 19 per cent increase in its current cloud package backlog – a management measure of incoming business at constant currencies, SAP had “an absolute blowout in the cloud” in the first quarter, said Klein.

To bring the total to 16,400, of which 9,600 are live, the company also added 400 customers for S/4 HANA, its premium enterprise resource software platform. Customer wins in the quarter included Google and Toshiba.

In the first quarter, total revenue including SAP’s traditional mainstays of license sales and service revenues, rose by 2 per cent at constant currency to €6.35 billion.

Reported operating profit was depressed by executive share compensation, which SAP accounts for as a cash expense. After stripping out the effect of that, adjusted operating profit rose by 24 per cent to €1.74 billion at constant currency.

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