SAP claims doubling of cloud sales as both licence and support revenues also rise

Cloud revenues now 60 per cent of licence income at SAP

SAP's latest quarterly figures have revealed a doubling of "cloud subscriptions and support", from €280m to €600m. The results means that cloud subscription (and "support") sales now accounts for around 60 per cent of the company's licence revenues, which increased by a more leisurely seven per cent to €1.01bn in the third quarter.

Total revenues increased by 17 per cent to €4.98bn, with operating profit weighing in at a healthy €1.62bn. However, the accounts indicate that the figures have been flattered somewhat by currency changes - licence revenues grew by just four per cent in constant currency.

In addition, the figures, especially for cloud computing, will include the $8.3bn acquisition of expenses-management services provider Concur Technologies in September 2014, which will have greatly boosted cloud revenues in particular. Concur had sales of $545.8m in 2013, its last full fiscal year before its acquisition. The deal was completed in December 2014.

New licence sales, meanwhile, have been partly driven by an aggressive campaign by SAP to shift users of its legacy enterprise resource planning (ERP) software from predominantly Oracle back-end databases to its own SAP HANA database.

Indeed, CEO Bill McDermott highlighted SAP HANA licence sales in the third-quarter release statement: "Our flagship S/4HANA is rapidly gaining market share. HANA is redefining the database industry as the standard real-time platform. Our cloud solutions for workforce engagement are best in class and our omni-channel customer experience solutions are growing faster than best of breed competitors."

Chief financial officer Luka Mucic added that sales of both cloud subscriptions and traditional software sales were "mainly driven by excellent results in mature markets. SAP's global resilience helped us also sail through stormy waters in emerging markets where we expect to continue to see volatility and economic challenges".

The strong set of figures comes despite complaints from users about "forced march" upgrades to S/4 HANA, the latest iteration of its ERP software, which requires them also to shift the backend database to SAP's own, as well as claims of high licence and maintenance charges.