SAP: solid growth in cloud reassures investors
(CercleFinance.com) - Last night, SAP unveiled a solid performance in the cloud, allaying investor fears of a possible slowdown in its cloud computing activities.
On Monday evening Europe's leading software company announced that it had generated total sales growth of 10% at constant exchange rates in Q2.
This is the first time that the German group has returned to double-digit organic growth since the beginning of 2019.
SAP explains that its performance was underpinned by its cloud businesses, where sales rose 25% at constant exchange rates in Q2 to end-June.
But for the third time in a row, growth in its cloud sales was outstripped by growth in its cloud order book, an encouraging sign for the future.
SAP - whose clients include giants such as ExxonMobil, Accenture, BASF and Lenovo - reports that its cloud division's order book climbed by 28% in Q2.
This contrasts with the publications of some of its peers, which point to a certain weakness in demand, Berenberg analysts said.
In fact, amongst major software groups, SAP is so far the only one to report resilient order backlog growth this year, the German broker added.
SAP reiterated its financial targets for 2024, but slightly raised its operating profit forecast excluding non-recurring items for 2025, to E10.2bn (from E10bn previously).
At around 10:20 a.m., the software company's shares were up 5.8%, posting the biggest gain on the Frankfurt Stock Exchange's DAX index and outperforming the European sector index, the STOXX Europe 600 Technology (+0.6%).
Copyright (c) 2024 CercleFinance.com. All rights reserved.
On Monday evening Europe's leading software company announced that it had generated total sales growth of 10% at constant exchange rates in Q2.
This is the first time that the German group has returned to double-digit organic growth since the beginning of 2019.
SAP explains that its performance was underpinned by its cloud businesses, where sales rose 25% at constant exchange rates in Q2 to end-June.
But for the third time in a row, growth in its cloud sales was outstripped by growth in its cloud order book, an encouraging sign for the future.
SAP - whose clients include giants such as ExxonMobil, Accenture, BASF and Lenovo - reports that its cloud division's order book climbed by 28% in Q2.
This contrasts with the publications of some of its peers, which point to a certain weakness in demand, Berenberg analysts said.
In fact, amongst major software groups, SAP is so far the only one to report resilient order backlog growth this year, the German broker added.
SAP reiterated its financial targets for 2024, but slightly raised its operating profit forecast excluding non-recurring items for 2025, to E10.2bn (from E10bn previously).
At around 10:20 a.m., the software company's shares were up 5.8%, posting the biggest gain on the Frankfurt Stock Exchange's DAX index and outperforming the European sector index, the STOXX Europe 600 Technology (+0.6%).
Copyright (c) 2024 CercleFinance.com. All rights reserved.