SAP Posts Rise In Q3 Profit, Lowers Full-Year Outlook

SAP AG

reported a 15% gain in its Q3 net profit and cut its earnings forecast for the year. SAP now projects full-year operating profit of EUR5.6 billion to EUR5.8 billion, versus its previous outlook of EUR5.8 billion to EUR6 billion. It also raised its cloud subscriptions and support revenue guidance to €1,040 million to €1,070 million The Walldorf, Germany-based company posted a quarterly net profit of EUR880 million, versus a year-ago profit of EUR762 million. However, analysts were expecting a profit of EUR808 million. Its total revenue climbed 5% to EUR4.25 billion versus EUR4.05 billion. SAP's cloud revenue jumped 45% to EUR277 million compared to EUR197 million. Non-IFRS cloud subscriptions and support revenue in EMEA jumped 59%, while cloud subscriptions and support revenue gained 34% in the Americas region. Operating cash flow rose 1% y/y to €3.08 billion from €3.04 billion), while free cash flow fell 1% to €2.61 billion from €2.64 billion. "We are accelerating our shift to the cloud with more than 40% revenue growth in the cloud. SAP is THE cloud company powered by SAP HANA helping customers run simple with over 44 million cloud users and the world's largest business network. We are leading the next generation customer engagement with the triple digit growth of our omni-channel e-commerce platform," said Bill McDermott of SAP. SAP shares fell 4.13% to $66.14 in pre-market trading.