SAP hits demanding software revenue target
For 2004, SAP set itself the goal of returning to double-digit
software revenue growth, with a target of 10 %. The €2,361 million
software revenue that the Company recorded was exactly
on that target. On a constant currency basis, software revenue
climbed 13 %. Translated to U.S. dollars for comparison, SAP’s
software revenue rose 19 % – a significantly larger increase than
was achieved by the Company’s key U.S. peers.
That 2004 was so successful for SAP in terms of software
revenue is due largely to its achievement in the United States.
The Company believes it shone in the United States and elsewhere
principally because of its well-positioned sales organization
and the breadth and depth of its product offering.
SAP regularly surveys its customers to find out how
they plan to deploy the software they buy. This enables the
Company to allocate its software revenue to various software
solutions. The 2004 results indicate especially strong growth,
14 % to €501 million, in the customer relationship management
segment. ERP solutions were even more successful; revenues
of €990 million represented a 23 % increase.
At the beginning of 2004, SAP publicly forecast above-average
revenue growth for the year in the financial services and public
services sectors. The Company successfully met that expectation
in both cases – SAP’s software sales to public services
increased 28 % to €242 million and its software revenue from
the financial services sector grew 14 % to €198 million.
On the basis of orders received, 31 % of software revenue
was from small and midsize businesses (SMBs – companies
with fewer than 2,500 employees or translated revenue of less
than one billion U.S. dollars). In 2003, 28 % of SAP’s software
revenue was from SMBs. The Company therefore met the
target it set early in 2004 of significantly increasing sales to
SMBs.
Maintenance revenue rises 10%
In 2004, the Company’s maintenance revenue grew 10 % (13%
at constant currencies). Product revenue – software revenue
plus maintenance revenue – climbed 10 % from the previous
year’s €4,716 million to €5,184 million in 2004.
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