SAP has increased its second quarter sales above expectations, fuelling further competition in the business software market with major rival Oracle.

The supplier says revenue was up 14 per cent to 2.4bn Euro (£1.6bn) on the back of rising sales of software and software-related services, which increased 19 per cent from 1.5bn (£1.bn) Euro to 1.7bn Euro (£1.15bn). Last month Oracle announced quarterly sales up 20 per cent to $5.8bn (£2.9bn).

The two companies have been involved in an at times bitter battle for dominance in the sector, with Oracle filing a lawsuit earlier this year against SAP, accusing its rival of ‘corporate theft on a grand scale’.

SAP chief executive Henning Kagermann admitted that subsidiary TomorrowNow did carry out inappropriate downloads, but said SAP did not access intellectual property.

‘There are a lot of allegations being made by Oracle that I do not believe are true. We look forward to the next hearing in September,’ he said.

SAP generated double-digit growth in all regions, with sales in Europe, the Middle East and Africa up 17 per cent, the Americas up 18 per cent, and Asia Pacific up 29 per cent.

The supplier is expected to launch a new on-demand product in September, codenamed A1S, and is also considering acquisitions to drive growth further.

‘There has been significant consolidation in recent years, and if you look at the market there is not a lot left.

‘So we will be very careful in selecting the right targets and make targeted acquisitions,’ said SAP chief financial officer Werner Brandt.