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  • SAP Pre-Announces Record Q2 Revenues

    July 16, 2012 Dan Burger

    Infor with its shopping list of IBM i-centric ERP businesses earns more than SAP in this niche. Thanks to its JD Edwards business, so does Oracle. But SAP is still the biggest of those fish in the ocean, it has thousands of IBM i installations, and its quarterly financial reports are eagerly awaited by the stock market mongers. And once again, SAP is eager to show off its record catch.

    Let’s begin by noting this was the company’s best revenue-generating Q2 in history. A currency-adjusted 19 percent gain in software revenues put a snap in SAP’s step to the tune of $1.3 billion (U.S.). Total revenue for the quarter showed a currency-adjusted 12 percent gain and operating profit was 8 percent plumper than a year ago.

    Bill McDermott and Jim Hagemann Snabe, the Co-CEOs at SAP, received a twin attribution on this quote taken from the SAP statement provided to the press: “Our record performance speaks for itself. We delivered double-digit growth in all regions driven by strong momentum from the core as well as SAP HANA, mobile, and the cloud. The results came in at the upper end of our second quarter software revenue guidance in an uncertain macro-economic environment.”

    But take a closer look at the language these numbers are speaking. To begin with, these are all preliminary numbers based on SAP’s desire to pre-announce its good fortune. The full report will spill out July 24. Despite an impressive 10 consecutive quarters of double-digit revenue growth, there are signs of wilting profits.

    Here’s an abbreviated view that I glimpsed from the window of my esteemed colleague here at IT Jungle, Timothy Prickett Morgan.

    After combining software licenses and software and support, you find that other revenue only increased 8.3 percent. Then when you notice that operating profits rose by 7 percent and operating margins declined by 2.4 percent, it appears operating profit is not in line with revenue growth. You also have to take into account that SAP’s overall revenue, when comparing this quarter to a year ago, were lifted by revenue from SuccessFactors, a cloud-based provider of human capital management (HCM) software, which was acquired in December 2011.

    Also worth noticing . . . in the afterglow of the preliminary announcement, SAP stock got a quick shot in the arm to rebound from a weeklong downward trend.

    RELATED STORIES

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    SAP Stamps Its Mark On 2011

    SAP to Buy Cloud HCM Vendor for $3.4 Billion



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Volume 21, Number 26 -- July 16, 2012
THIS ISSUE SPONSORED BY:

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Table of Contents

  • Windows On The (2012 And Cloudy) World
  • IBM i Mobile Native Apps Coming On Strong
  • Used Software Scores A Legal Victory In Europe
  • Mad Dog 21/21: Up Close And Personal
  • One More Power Systems Roadmap For The Road
  • Continued Caution Sways 2012 Worldwide Spending Re-Forecast
  • IBM Launches Single-Socket PowerLinux Server, Tweaks Power Systems I/O
  • Scott Klement Joins Profound Logic Staff
  • Ultrium Tape Drive Makers Ready LTO 6 Units
  • SAP Pre-Announces Record Q2 Revenues

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