Software vendor SAP announces highest ever profits

Future growth seen in on-demand mobile and in-memory computing

Business software giant SAP has announced record results for Q4 2010. The results included the highest software sales and largest profits in the company's history.

Software revenue increased 35 per cent to €1.5bn (£1.3bn), as the number of deals made increased by 36 per cent on Q4 2009.

A figure of €933m (£807m) was added to operating expenditure as a result of the TomorrowNow case, in which Oracle successfully sued SAP for copyright infringement.

CFO Werner Brandt said: "We may consider an appeal [which could reduce that amount]. The amount of the jury award cannot be reliably measured at this time. So SAP has based the provision on the jury award, but will examine this again going forward."

Despite this additional expenditure, total operating expenditure was down 62 per cent year on year. Brandt said that the company had achieved more than €1.8bn (£1.5bn) in profit after tax.

The European region performed especially well in software sales and software-related services, growing by 20 per cent.

Co-CEO Bill McDermott said: "Emerging markets in Europe are growing fast. We are optimistic in Europe."

The company is bullish about its future, largely due to confidence in its technology innovations.

Co-CEO Jim Hagemann Snabe said: "We defined a winning strategy based on innovation, over consolidation. Not only can we go into new areas like on-demand, mobile and in-memory computing, but we also got our core business to grow again."

Snabe emphasised the importance of the acquisition of enterprise and mobile software provider Sybase to SAP's strength in the mobile market, in addition to the performance of enterprise software solution ByDesign, which he claimed will change the on-demand market.

He stated that there are more than 250 customers of the product now, but that figure is expected to grow beyond 1,000 by the end of the year.

He concluded: "In-memory computing is a true breakthrough. It's a complete re-thinking of the way data is stored, and allows you to scale to infinity in terms of speed and size of computing."