German software major SAP AG (SAP) Thursday reported an increase in profit for the second quarter, as revenues rose reflecting performance in the cloud segment. Moving ahead, the company updated its full-year outlook.
“This has been another strong quarter. We see significant opportunities ahead, in particular through the transformative power of AI. We are focused on delivering SAP Business AI that’s relevant, reliable, and responsible and we see significant possibilities for market expansion through these technologies and new premium offerings,” CEO Christian Klein said.
For the second quarter, profit after tax rose to 3.38 billion euros from 203 million euros last year. Earnings per share increased to 2.93 euro per share from $0.29 euro per share last year.
Profit after tax from continuing operations gained 18 percent to 724 million euros from 613 million euros last year. Earnings per share from continuing operations were 0.62 euro, up from 0.54 euro a year ago.
Total revenues for the quarter rose 5 percent to 7.55 billion euros from 7.21 billion euros in the prior year.
Current cloud backlog grew by 21% to 11.54 billion euros and was up 25% at constant currencies.
In the second quarter, cloud revenue was up 19% to 3.32 billion euros and up 22% at constant currencies. Software licenses revenue decreased by 26% to 316 million euros and was down 24% at constant currencies.
For 2023, SAP is updating its revenue and operating profit outlook.
The company now expects cloud revenue at constant currencies to be 14.0 billion to 14.2 billion euros. The previous range was 14.0 billion to 14.4 billion euros.
Cloud and software revenue are expected to be 27.0 billion to 27.4 billion euros, compared to previous range of 26.9 billion to 27.4 billion euros.
The company now expects adjusted operating profit of 8.65 billion to 8.95 billion euros, up from previous range of 8.6 billion to 8.9 billion euros.
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