SAP Profit Rises 43%

SAP ( SAP) said second-quarter earnings rose 43% from a year ago, driven by higher software license sales in the U.S.

The German firm earned $517.5 million, or 42 cents an American depositary share, in the quarter, compared with $361.3 million, or 29 cents an ADS, a year ago. Sales were $2.75 billion in the most recent quarter, compared with $2.5 million a year ago. Analysts were predicting earnings of 42 cents an ADS on sales of $2.7 billion.

SAP said software license revenue rose 8% from a year ago to $776 million in the second quarter, while product revenue rose 9% to $1.88 billion. By region, software revenue rose 18% in the Americas, including a 16% rise in the U.S. Software revenue rose 3% in the Europe-Middle East-Africa division and was unchanged in Asia.

Operating margin was 24.2% in the most recent quarter, up 140 basis points from a year ago.

"SAP is on track for another successful year. Product revenue, pro forma operating margin and pro forma earnings per share all gained strongly in the first half and we succeeded in extending our global market share," the company said. "Software revenues were slightly below our expected full-year growth range, primarily due to order phasing and delayed contracts, but order entry -- a key indicator for future software revenues -- and our win rate against competitors both remained strong.

"The customer spending environment is stable and customer satisfaction is high, which has been helped by our clear product roadmap and well-defined product deliverables."

SAP previewed the software revenue last week, leading to a selloff in its shares. In Thursday's premarket, SAP's shares rose $1.12, or 2.4%, to $47.27.

More from Technology

Experts Break Down GDPR Risks for Investors

Experts Break Down GDPR Risks for Investors

Netflix Ready to Surpass Disney as America's Most Valuable Media Company

Netflix Ready to Surpass Disney as America's Most Valuable Media Company

60 Seconds: What the Heck is GDPR?

60 Seconds: What the Heck is GDPR?

Musk's Tweets About Unions Draw Fire From United Auto Workers

Musk's Tweets About Unions Draw Fire From United Auto Workers

PayPal Wants to Consolidate the World of Rewards Points

PayPal Wants to Consolidate the World of Rewards Points