SAP's encouraging Q2 figures beginning of 'runaway growth story' says CEO

Record-breaking quarter put down to joint ASE and HANA uptake, say bosses

SAP has announced a successful financial quarter, with a 26 per cent year-on-year growth pushing revenue beyond the €1bn mark.

With the software giant seeing double-digit growth across all its customer regions, co-CEO Bill McDermott put SAP's success down to growing demand for the streamlined enterprise applications it offers, in particular real-time analytics software HANA, and database management system ASE (Adaptive Service Enterprise).

On today's Q2 financial conference call, McDermott said that companies are now leveraging SAP's technology to "innovate and grow".

"The internet of things will lead to 50 billion connected devices by 2020," said McDermott, "allowing business to completely change how they interact with their customers. We are already seeing intelligent vending machines, connected vehicles, connected healthcare devices, and smart media is driving this. To anticipate the needs of this new consumer, companies are rethinking the ways in which they manage their business."

McDermott described how ASE, based on database technology SAP picked up in 2010 when it acquired Sybase, is becoming "more a part of the story" as it is licensed by customers along with SAP HANA.

Co-CEO Jim Hagemann Snabe agreed, saying the company was now seeing the fruits of "a very successful integration into ASE", with SAP "beginning to see the first customers who go for the combination of the SAP apps with the ASE as the database".

McDermott said the broadening appeal of HANA and ASE bode well for the future.

"[Canadian National Railway] adopting [ASE] is testimony it's not just for small and midsized [companies], but also for large," said McDermott. "It grew 60 per cent on a year-on-year basis in Q2, and that makes it the fastest-growing database business in the world. Couple with HANA [growing year on year] in triple digits, and you've got a real runaway growth story on your hands here."

When asked if large contracts were moved around in order to create a particularly successful Q2, McDermott was adamant that the company's figures did not need to be propped up.

"On the seasonality side of things, let me be clear," said McDermott. "We did not pull Q3 forward to achieve Q2. Q2 stood on its own merits; the linearity was very consistent and predictable throughout the quarter, and it wasn't swayed by any one big transaction."