SAP co-CEO: Cloud computing growing strongly (Update)

Oct 21, 2013 by David Mchugh

Business software maker SAP's strong growth in cloud computing remains on track despite headwinds from a stronger euro, the co-CEO said Monday.

SAP's revenue from cloud computing—where companies use software based at servers instead of at their own offices—more than tripled in the third quarter, to 191 million euros ($261 million) from 63 million euros a year earlier. The business is smaller than SAP's older business installing and servicing software at companies. But the cloud part of the business is showing much faster growth.

"We said we'd be the cloud company," Bill McDermott told the Associated Press on Monday, emphasizing the word "the." ''We are the fastest growing cloud story in the enterprise software world."

SAP AG, headquartered in Walldorf, Germany, said net profit rose 23 percent to 762 million euros as revenue rose 2 percent to 4.045 billion euros. Net profit grew faster than top-line revenues in part because the company held down costs by restraining new hires. It had 66,061 fulltime workers at the end of the quarter, up only 380 from a year ago once businesses the company has acquired were discounted.

The company's shares rose 5.3 percent to 56.32 euros in late afternoon trading in Europe.

Revenue from the company's older, on-site software business slipped 5 percent to 975 million euros—but grew 2 percent when excluding the impact of exchange rate shifts. The company stayed with its forecast for sales and profit for the full year.

"The euro is unbelievably strong and there's nothing operationally that we could do about that," McDermott said.

Explore further: Smartphone sales lifted by emerging markets

not rated yet
add to favorites email to friend print save as pdf

Related Stories

SAP profits up 23 percent as cloud computing grows

Oct 21, 2013

Business management software company SAP AG says net profit rose 23 percent in the third quarter as its cloud computing business grew rapidly and the company kept down costs by holding down hiring of new employees.

SAP profit up 10 percent in second quarter

Jul 18, 2013

(AP)—Business software maker SAP AG said net profit grew 10 percent in the second quarter to 724 million euros ($948 million) despite the economic slowdown in Asia.

SAP sales rise, company boosts outlook

Oct 24, 2012

(AP)—Business software maker SAP AG saw its third quarter profit fall from a year ago because of a large one-time gain booked then, but the company raised its sales outlook for the year and said its business in cloud computing ...

Recommended for you

Lenovo wraps up purchase of Motorola phone unit

3 hours ago

Lenovo Group announced the completion of its acquisition of Motorola Mobility from Google Inc. on Thursday in a move aimed at making the Chinese computer maker a global smartphone brand.

Baidu profit up 27 percent as mobile grows

6 hours ago

Chinese search engine Baidu Inc. said Thursday its quarterly profit rose 27 percent as user traffic for its mobile operation surpassed passed its desktop computer-based search business.

Samsung vows changes after mobile profit plunges

7 hours ago

Samsung Electronics Co. admitted erring in its smartphone strategy and vowed Thursday to overhaul its handset lineup after profit from those devices tumbled last quarter to the lowest in more than three years.

WhatsApp founders own nearly $9B in Facebook stock

7 hours ago

WhatsApp founders Jan Koum and Brian Acton received 116 million shares of Facebook stock currently worth nearly $9 billion when they sold their unprofitable messaging service to the social networking leader earlier this month.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.