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SAP Profit Jumps to $1.7 Billion

FRANKFURT, Germany -- Business software maker SAP (SAP) said net profit jumped to €1.25 billion ($1.7 billion) in the third quarter as the company reduced the amount of money set aside for a possible judgment against it in a lawsuit brought by Oracle (ORCL).

The profit figure reported Wednesday for the third quarter is more than twice the Oracle 501 million result from a year ago. Revenue rose 14% to €3.4 billion.

The earnings got a large one-time boost of €723 million when SAP reduced the amount of money set aside to cover any judgment costs from the legal case from Oracle.

Oracle last year won a $1.3 billion jury verdict against Walldorf, Germany-based SAP over the theft of documents from password-protected sites by SAP's former subsidiary TomorrowNow. A judge threw out that verdict on Sept. 1 but the case is not over.

Oracle can accept a reduced judgment of $272 million or seek a new trial. The deadline for Oracle to make that choice will vary depending on the outcome of an Oracle appeal motion, SAP said Wednesday. If the appeal is denied and Oracle rejects the lower judgment, a new trial for damages will be set, SAP said.

SAP acknowledged the theft and shut down TomorrowNow. It agreed to pay $20 million to settle criminal charges from the U.S. Department of Justice.

The company said it had otherwise experienced strong top-line sales growth and better operating margins. Software revenue grew 28% and support revenue 13%.

Operating margins increased by 3.1 percentage point to 33.2%, under a different set of accounting rules that exclude the legal set-aside.

SAP makes software to help companies handle personnel, accounting, manufacturing and customer relations. It also offers support and training services.
Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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