SAP Q1 2021: Income nudges up 2% one year-on-one year, S/4 adoption up 2.5% on prior quarter

SAP has reported first quarter 2021 earnings of €6.35bn, up 2% on the identical one year-ago quarter. Cloud earnings has increased by 1% one year-on-one year, and S/4 adoption is up 2.5% on the outdated quarter

Brian McKenna

Brian McKenna,
Enterprise Applications Editor

Revealed: 22 Apr 2021 12: 45

SAP has reported first quarter 2021 earnings of €6.35bn, up 2% on the identical one year-ago quarter. Its cloud earnings has increased by 1% to €2.147bn, representing 34% of the total.

The supplier has acknowledged its flagship S/4Hana ERP device added 400 original customers in the quarter, taking total adoption to 16,400, an amplify of two.5% on the outdated quarter. In that quarter, Q4 of 2020, 900 original customers had been added for S/4Hana.

The quarter became well-known for the January start of the “Rise with SAP” kit, described in the Q1 outcomes commentary as a “simplified pathway for customers to remodel their enterprise in the cloud”. Potentialities cited for the provider consist of Carrefour Brazil, Sono Motors, KIA Chile, Hillrom, and Grupo Feromax.

Rise is a subscription provider that programs managed cloud infrastructure and managed companies in one contract. It is a intention of bundling your complete components that extinguish up what SAP has been calling “radiant enterprise” for the past few years and making them on hand as a provider. In roar, it’ll also very properly be a intention of dashing up in any other case sluggish adoption of S/4Hana.

Christian Klein, CEO, SAP acknowledged, in the effects commentary: “We’re seeing very solid expose entry boost all over our applications portfolio. And we are honest getting started. Our original offering ‘Rise with SAP’ is hastily becoming a large accelerator to our customers’ enterprise transformations with our platform on the centre. Along with our outlandish ecosystem of further than 22,000 companions and with a solid innovation pipeline for the one year, we are properly on track with our intention to bring sturdy cloud boost.”

Luka Mucic, chief financial officer, added: “The first quarter of 2021 became outlandish in many programs. We had the highest expose entry boost all over cloud and energy in 5 years whereas posting the strongest amplify in Non-IFRS working earnings [€1.741bn] and margin in a decade. In the mid-term, SAP’s expedited shift to the cloud will tempo up top-line boost and critically amplify the resiliency and predictability of our enterprise”.

The supplier cited “customer wins” at companies in conjunction with Unilever, BioNTech, IKEA, Nippon Insist, BMW, Yamaha Motor Firm, Toshiba Company, and AstraZeneca. It also highlighted spin-lives at Google, Bosch Siemens Hausgeräte and Peloton.

In the commentary it also famed “valuable competitive wins in ERP, digital supply chain and all over its broader cloud resolution portfolio”.

Right here’s in the context of the litany of Oracle wins in opposition to SAP declared by Larry Ellison in the financial analyst name accompanying its most show quarterly finally ends up in March.

At that point, SAP’s reliable response became: “We’ve heard this sooner than and it’s as false now as it became then. Our priority is driving our customers’ success, no longer placing them in the heart of a public relatives battle. And our numbers be in contact for themselves our growing ERP market allotment is by now approximately double that of our closest competitor.”

In a financial analyst name, on the day of the liberate of the Q1 2021 outcomes, Klein hit aid at what he described as Oracle’s “spurious claims”. He acknowledged: “I decide it as a definite signal that conception to be one of our main competitors spent so worthy time speaking about SAP on their possess earnings name. We went through their customer checklist [that Ellison brandished] and checked their claims. I’d aid you to elevate out your possess be taught. The most recent IDC files also helps to place issues into point of view. It reveals that SAP has taken valuable ERP market allotment since launching S/4Hana in 2015.”

SAP recorded, in the effects commentary the completion on 5 March of the acquisition of Signavio, a enterprise process intelligence firm, which it announced all over the identical time as the inception of the “Rise” provider.

At the time of the announcement of Rise, Paul Cooper, chairman of the UK & Eire SAP Particular person Neighborhood, acknowledged: “It’s been an especially spirited 12 months for many organisations, as they’ve juggled between maintaining ‘enterprise as traditional’ operations and accelerating their digital roadmaps.

“Our present member watch revealed that 30% of organisations had delayed their plans to pass to SAP S/4Hana due to the the Covid-19 pandemic. We due to the this truth welcome ‘Rise with SAP’ as a kit to motivate customers develop into their enterprise by moving to the cloud in a sustainable intention that suits them.

“This is also curious to glimpse if ‘Rise with SAP’ also helps customers own a solid enterprise case to pass to SAP S/4Hana. For these customers in the heart of enterprise transformation or these apprehensive relating to the 2027 repairs time restrict [for ECC6], ‘Rise with SAP’ can also very properly be an comely risk as they decide into consideration their choices.”

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