SAP said adjusted operating profits for the three months ending in June rose 8% from last year to €1.816 billion, a figure that fell just shy of analysts' forecasts. On an unadjusted basis, however, operating profits fell 21% to €830 million thanks to costs linked to its $8 billion purchase of U.S.-based Qualtrics International last year and its headcount reductions in Germany.
Group revenues rose 8% on a constant-currency basis, the company said, but at €6.656 billion were again just short of Street expectations. SAP's cloud revenue rose 35% to €1.717 billion, the company said, while software licence and support revenues were essentially flat from last year at €3.802 billion as trade disputes between Washington, Beijing and Brussels trimmed sales.
"SAP delivered double digit growth in total revenue, cloud revenue and non-IFRS operating income. Qualtrics is growing fast as the global standard in the Experience Management category," said CEO Bill McDermott. "As shown by our rising cloud gross margins, we are progressing nicely on our ambition to be the Best-Run SAP. With XM driving the CEO digital transformation agenda, we resolutely reaffirm our full year guidance."
SAP shares were marked 5.85% lower by mid-afternoon trading in Frankfurt to change hands at €113.08 each, a move that still leaves the stock with a 30% year-to-date gain.