SAP Net Rises as Software Sales Plunge 40%

Updated from 1:39 a.m. EDT

WALLDORF, Germany (TheStreet) -- Enterprise software maker SAP(SAP Quote) reported second-quarter earnings rose about 4% to 423 million euros ($599.4 million) from a year earlier and said it expects margin improvements for the full year.

But revenue in the quarter dipped 10% to 2.58 billion euros from 2.86 billion, and software revenue in the quarter fell 40% to 543 million euros.

SAP, in a statement Wednesday, attributed the decline in software revenue to the "difficult operating environment worldwide due to the continued global economic downturn, and the tough comparison to the second quarter of 2008."

Operating margin in the quarter was 25.1%, up from 20.7% a year earlier. On a non-GAAP basis, operating margin was 27.7%, up from 24.4% in the same period in 2008), or 27.9% at constant currencies.

"While the operating environment remains difficult, we are beginning to have improved visibility into the second half of the year," CEO Leo Apotheker said, in a statement.

The company said it expects its full-year 2009 non-GAAP operating margin, which excludes certain writedowns and charges, in a range of 25.5% to 27% at constant currencies.

The company didn't provide a full-year earnings or sales forecast.

Reported by Joseph Woelfel in New York.