SAP reports revenue of €6.091 bn and operating loss of €136 mn

SAP has reported revenue of €6.091 billion (+16 percent) with operating loss of €136 million in the first quarter of 2019. SAP’s Cloud revenue rose 45 percent to €1.555 billion.
SAP Cloud revenue Q1 2019
SAP said its operating profit was impacted by recognizing the expected cost of SAP’s 2019 restructuring charges of €886 million as well as higher acquisition-related charges and share-based compensation primarily due to the Qualtrics acquisition.

SAP will host Special Capital Markets Day on November 12, 2019 to lay out the details of several new initiatives to accelerate operational excellence and simplify organizational structures and processes.

SAP will increase its investment in core product areas and empower its leadership team to drive faster development cycles and speed of execution.

SAP will detail the path to achieve 75 percent non-IFRS cloud gross margin in 2023 and 1 percentage point of non-IFRS operating margin expansion per year from 2018 through 2023, representing total margin expansion of approximately 500 basis points during the period.

SAP CEO Bill McDermott said: “Since 2010, SAP has fundamentally transformed through organic innovation and acquisition. We have an incredibly strong core business and a high-growth cloud portfolio with years of runway for continued growth.”

SAP said S/4HANA adoption grew to more than 10,900 customers (+30 percent), while over 40 percent of the additional S/4HANA customers were new. Levi’s, Schaeffler Technologies and CVS Health were some of the new clients for S/4HANA.

Puma and Bausparkasse Schwabisch Hall went live with S/4HANA. ESL/Turtle Entertainment and AEG have chosen S/4HANA in the Cloud. Computacenter went live on S/4HANA Cloud.

SAP SuccessFactors Employee Central, which is the flagship of SAP’s HCM offering, added more than 150 customers in the quarter and has now approximately 3,200 customers globally. SAP did not reveal the number of clients for SAP Leonardo. Companies like Bumble Bee Foods and Premier Foods are among many others that adopted SAP Leonardo solutions in the first quarter.