SAP 1Q Revenue, Operating Profit Higher
By Denny Jacob
SAP posted higher revenue and operating profit in the first quarter.
Reporting on a non-IFRS basis, the German business-software company said Monday that total revenue rose to 8.04 billion euros ($8.57 billion) from EUR7.44 billion in the first quarter of 2023. Revenue from SAP's core cloud business climbed to EUR3.93 billion from EUR3.18 billion, while software-licenses revenue declined to EUR203 million from a year earlier.
Profit after tax declined to EUR944 million from EUR1.01 billion. Operating profit, more closely watched for software companies, rose to EUR1.53 billion from EUR1.32 billion.
SAP, like other European software companies, presents its figures as two sets of numbers. One set is based on the International Financial Reporting Standards, an international accounting method that seeks to provide a global reporting standard, though analysts and investors tend to follow SAP's non-IFRS numbers.
Those figures had until last year excluded share-based compensation, restructuring expenses and acquisition-related charges. However, SAP began including share-based compensation expenses in its non-IFRS results in January.
For 2024, SAP expects non-IFRS operating profit at constant currencies between EUR7.6 billion and EUR7.9 billion, cloud revenue at constant currencies between EUR17 billion and EUR17.3 billion and free cash flow of roughly EUR3.5 billion.
By 2025, SAP expects non-IFRS operating profit of approximately EUR10 billion, including share-based compensation expenses of roughly EUR2 billion, and free cash flow of about EUR8 billion.
Write to Denny Jacob at denny.jacob@wsj.com
(END) Dow Jones Newswires
April 22, 2024 16:53 ET (20:53 GMT)
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