SAP SE  (SAP) posted slower-than-expected third quarter profits but modestly increased its full year targets amid a renewed surge in cloud computing demand that has helped rival IBM Corp. (IBM) notch its biggest market gain in eight years.

SAP said core profits for the three months ending in September rose 4% to €1.64 billion ($1.94 billion) and saw sales rise 8% to €5.6 billion, both figures falling shy of analysts' forecasts compiled by FactSet. However, the group said it sees full year sales of between €23.4 billion and €23.8 billion, a small increase from its previous estimate, thanks to "strong momentum in SAP's cloud business".

"SAP has evolved from the world's system of record to the platform for the digital revolution. Led by S/4HANA, we are delivering intelligent business applications built on the most data rich architecture ever created," said CEO Bill McDermott. "We see growth in every corner of the business, which is why we are again raising our guidance for the full year."

SAP said its cloud subscriptions and support revenue rose 27% to €938 million, the company said, compared to a 4% growth rate in software lisences and support business. 

SAP shares were marked 2.2% lower at €93.12 in early Frankfurt trading, compared to a 0.5% decline for the DAX performance index, trimming their three-month gain to just over 4%. 

IBM shares gained the most since 2009 yesterday on Wall Street after the group forecast sales in the final three months of this year, traditionally its strongest quarter, to come in at just of $22 billion, a tally that would snap a streak of 22 consecutive quarterly declines.

IBM topped analysts' estimates with an 11% increase in third quarter sales at its cloud, cybersecurity and data analytics division, which came in at $8.8 billion, but still saw overall revenues fall 0.4% to $19.15 billion from the same period last year.

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