SAP Leaps on Earnings Beat. What That Means for IBM, Oracle, and Microsoft. -- Barrons.com

Dow Jones
04/23

By Adam Clark

German software company SAP surged on Wednesday after it reported better-than-expected first-quarter earnings, potentially boding well for peers such as IBM, Oracle, and Microsoft.

SAP's quarterly adjusted earnings per share rose 79% to EUR1.44 ($1.64). Analysts had expected earnings of EUR1.32 a share, according to a company-provided consensus.

First-quarter revenue rose 11% at constant currencies to EUR9.01 billion. Sales from SAP's core cloud business jumped 26% to EUR4.99 billion. These were both misses as analysts had forecast total revenue of EUR9.10 billion and cloud revenue of EUR5.06 billion.

"Q1 [First Quater] once again underlines that our success formula is working. Current cloud backlog expanded 29% at constant currencies and total revenue saw a double-digit increase. With a share of more predictable revenue of 86%, SAP's business model remains resilient in uncertain times," CEO Christian Klein said in a statement.

SAP continues to expect an operating profit of between EUR10.3 billion and EUR10.6 billion, cloud revenue ranging from EUR21.6 billion to EUR21.9 billion and free cash flow of roughly EUR8 billion for the full year.

SAP shares were up 10% in Germany. Its American depositary receipts were up 8.6% in premarket trading.

Write to Adam Clark at adam.clark@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

 

(END) Dow Jones Newswires

April 23, 2025 05:26 ET (09:26 GMT)

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