Â© Reuters. FILE PHOTO: The logo of German software group SAP is pictured at its headquarters in Walldorf, Germany, May 12, 2016. REUTERS / Ralph Orlowski / File Photo
By Supantha Mukherjee
STOCKHOLM (Reuters) – German enterprise software group SAP raised full-year outlook for third time based on strong third quarter performance as more customers move IT operations to the cloud.
SAP now expects cloud revenue to grow 16% to 19% year-over-year, helping its overall cloud and software revenue to grow 2% to 4%, has t he said in a statement Tuesday night.
Operating profit is expected to remain stable at 2% for the year, an improvement from its earlier forecast of unchanged at 4%.
SAP, moving to subscription cloud services from up-front software licenses, launched Rise with SAP, an all-in-one digital transformation package in January.
“We are seeing record adoption of our applications and our platform,” Chief Executive Officer Christian Klein said in a statement. âThis has resulted in a strong acceleration of our growth in the cloud. “
SAP has raised its cloud and software revenue forecast for the full year from â¬ 200 million to â¬ 23.8 billion to â¬ 24.2 billion.
Cloud backlog for the flagship S / 4HANA database grew 58% at constant currencies and the current cloud backlog – a measure of inbound business – grew 22% in the third quarter .
Adjusted revenue increased 5% to 6.68 billion euros ($ 7.70 billion) for the third quarter ended September 30, the company said in a preliminary earnings release. SAP is expected to release full results on October 21.
Adjusted earnings per share rose 2% to 1.74 euros, supported again by its profitable venture capital investments, Sapphire Ventures.
($ 1 = 0.8672 euros)
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