SAP lowers revenue outlook for 2023 to €14 bn

Business software major SAP has revised its revenue outlook for 2023 to €14 billion – €14.4 billion from the earlier guidance of €15.3 billion – €15.7 billion in the wake of selling Qualtrics International to Silver Lake and Canada Pension Plan Investment Board.
sap-hana-erp-for-enterprisesSAP has reported 10 percent increase in the first quarter revenue to €7.441 billion. SAP’s cloud and software revenue rose 10 percent to €6.358 billion. SAP’s Cloud revenue grew 24 percent to €3.178 billion. SAP’s S4 / HANA revenue increased 77 percent to €716 milion.

SAP, a leading ERP software major, said cloud backlog grew by 25 percent to €11.15 billion. SAP S/4HANA cloud backlog rose 78 percent to €3.42 billion.

Supported by a few major transactions, software licenses revenue decreased by a moderate 13 percent to €276 million.

SAP said operating profit decreased 45 percent to €803 million mainly driven by the increase in share-based compensation which reflects the increase in share price over the first quarter as compared to last year’s decline over the same period.

“RISE with SAP” customers include BMW, DOLCE & GABBANA, GAMA, GlasfaserPlus, The Government of Manitoba, Henkel, KANSAI PAINT CO, Lingong Heavy Machinery, MLS, NEC Networks & System Integration Corporation, Pastificio Rana, Sempra Infrastructure, Sodexo BRS, Sri Intellectual, Thales Defense & Security Inc, VEM Conveniencia, and Zagis.

Advanced Micro Devices, Air India, Aurobay, FLYING WHALES, Hengan Group, JFE Steel, Ourofino Agrociencia, REPETCO Innovations, and Shinsegae International went live on SAP S/4HANA Cloud in the first quarter.

Key customer wins across SAP’s solution portfolio included: A.S. Watson, BayWa, Berlin Hyp, Brisanet, Dr. Martens (Airwair International), Envision Energy, Grupo Estrella Blanca, Grupo Minero Bacis, Haffner Energy, HCLTech, Hitachi HighTech Corporation, N+, NTT DATA Business Solutions, Lee Kum Kee Sauce Group, SMA Solar Technology, Soleum, University Hospital Bonn, and Whirlpool Corporation.

Numerous customers have also gone live with SAP solutions, including: Dexco, DKSH Holding, Larsen & Toubro, and Wipro.

In the first quarter, SAP’s cloud revenue performance was robust across all regions. Brazil, Germany and India had outstanding cloud revenue growth while China, Japan, Mexico, the Netherlands, Switzerland, and the United States performed particularly strong.

On March 13, SAP agreed to sell its 423 million shares of Qualtrics International to Silver Lake as well as Canada Pension Plan Investment Board for approximately $12.5 billion. SAP’s stake will be acquired for approximately $7.7 billion.

On March 21, SAP announced GROW with SAP, a new offering to help midsize customers adopt cloud ERP that enables speed, predictability and continuous innovation. It is a comprehensive offering built on SAP S/4HANA Cloud, public edition and SAP Business Technology Platform.

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