Revenue growth weak, cloud growth up 17%

by Jeremy

SAP has announced full-year financial results indicating a 1% drop in revenue to €27.338bn, with cloud revenue up 17% to €8.085bn. It did so two days after announcing a new “business transformation” service, Rise with SAP, which bundles managed cloud infrastructure and managed services into one contract and has 130 pilot customers.

Revenue growth weak, cloud growth up 17%

According to the financial results statement, SAP’s flagship ERP system, S/4Hana, now has 16,000 customers.

It said around “900 SAP S/4HANA customers were added in the [fourth] quarter, taking total adoption to approximately 16,000 customers, up 16% year over year, of which more than 8,700 are life”.

“In the fourth quarter, approximately 40% of the additional customers were net new, and organizations such as L’Oréal, Shell, Schwarz IT KG (Lidl), Co-op, Unilever, s. Oliver Group, Gilead Sciences, and Saudi Aramco chose SAP S/4Hana,” it said. “Boehringer Ingelheim went live with SAP S/4Hana in 41 Countries simultaneously.

“BT Group, A. P. Møller-Mærsk, Beijing Energy, the Coca-Cola Bottling Company of Egypt and Bertelsmann also went live. A fast-growing number of companies of all sizes, such as CureVac, Zespri, Oxford University Press, The Not Company, Nippon Cargo Airlines, BMW, Atos, and I-PEX, chose SAP S/4Hana Cloud.” Christian Klein SAP’s

CEO confirmed that part of the purpose of the new Rise package is to speed up S/4Hana adoption but added that it is, in SAP’s view, fast-growing anyway. “With Rising with SAP, we are going to accelerate the adoption of S/4Hana Cloud … But we are seeing that the adoption curve is perfect… much better than previous versions of SAP,” he said.

Luka Mucic, chief financial officer at SAP, added: “S/4Hana cloud is already approaching a run rate of €800m, with 3,300 customers, of which 2,000 are life. The rate of cloud adoption against on-premises S/4Hana was at a different level to previous years, and with Rising with SAP will achieve a much different pace of adoption in a concise time frame.

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