SAP Wins More Deals with its New Software
SAP SE, the leader in ERP software topped the analysts’ estimations in the Quarter 2 results with its new software. Despite the political turmoil in Europe, the company has closed more software deals and showed an operating profit of 1.52 billion Euros ($1.67 billion). SAP has surpassed an estimation of 1.45 billion-Euro collected by Bloomberg. The sales were 5.24 billion Euros, compared with an average 5.22 billion-Euro estimate.
Bill McDermottm, the Chief Executive Officer of SAP said he’s placing the company’s software to help companies remake sales strategy and buying processes in light of U.K. citizens’ vote last month to leave the European Union. “Any time there’s a pressure point where things are changing, business leaders are looking for a solution,” he said in an interview.
New software license revenue, an imperative predictor of earnings potential from support contracts, rose 10% to 1.04 billion Euros. That followed a 13% decline in the first quarter, which the company held responsible for a failure to close deals.
The CEO credited lower costs after last year’s job cuts for propping up the bottom line. “We closed any deal that wasn’t closed in Q1 and we had an extraordinary Q2,” he said. Cloud subscriptions and support revenue in the quarter increased as much as 41 percent to 721 million euros. SAP said it played particularly well in Europe despite Brexit-related uncertainty, getting in double-digit percentage growth in software licenses revenue from major markets such as France.