Financial Performance
Despite the macroeconomic challenges, the course of business was again favorable for SAP in 2022. The page below shows selected KPIs in more detail.
Growth
Our customers' accelerated transition to the Cloud is driving SAP's growth.
Continued strong Cloud performance
The growth rate of our current cloud backlog has accelerated further. This strong performance is despite the divesture of our Litmos business and the wind down of our business operations in Russia and Belarus.
Our outstanding Cloud revenue growth additionally benefited from the reacceleration of transactional revenues from Intelligent Spend and Business Networks.
Cloud drives double-digit revenue growth
Despite lower software licenses revenue, cloud and software revenue was up 10% to €26.52 billion.
Driven by the strong double-digit cloud growth and an outstanding performance in services, total revenue was up 11% year-over-year, showing great traction compared to the year-ago period.
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Profitability
2022 profits were impacted by investments needed to capture current and future growth opportunities
Future growth opportunities demanded investments
Operating profit was impacted by accelerated investments in the Next-Generation Cloud Delivery initiative and in other R&D and sales and marketing initiatives.
Further, geopolitical events had an effect on the results.
The differences between Non-IFRS and IFRS results are related to effects including restructuring, M&A and share-based compensation.
Operating margin impacted by investments in future growth
Operating margin, like operating profit, was impacted by the decision to wind down business operations in Russia and Belarus, and a reduced contribution from software licenses revenue as well as accelerated investments into research and development and sales & marketing to capture current and future growth opportunities.
Multiple effects impacted operating cash flow
Operating cash flow decreased due to lower profitability, higher advance payments to hyperscalers, and higher share-based payments. Lower income tax payments compensated some of those negative effects. In addition, the increased volume of trade receivables sold in 2022 had a further positive impact on operating cash flow.
Free cash flow influenced by working capital impacts
The decrease in free cash flow is predominantly due to lower profitability and adverse working capital impacts in other assets. While tax payments developed positively, smaller negative impacts came from share-based payments as well as capital expenditures and leasing.
Comparison of Outlook and Results for 2022
Our financial performance shows that we kept our promise and thoroughly executed on our plan by being laser-focused on building cloud momentum through agility and great cost discipline.
All financial outlook metrics were met in fiscal year 2022.
Dividend of €2.05 proposed
The Supervisory Board and Executive Board of SAP SE have decided to recommend that shareholders approve a dividend of €2.05 per share for fiscal year 2022. This is an increase of €0.10, or 5% compared to the regular dividend paid for 2021. The dividend for fiscal year 2021 consisted of a regular dividend of €1.95 and a special dividend of €0.50 in celebration of SAP SE’s 50th anniversary for a total dividend of €2.45.
Our dividend policy is to pay out at least 40% of Non-IFRS profit after tax to our shareholders.
Multiple crises dampen markets
The SAP stock, with an annual decline of 22.8%, finished the year higher than the NASDAQ 100, which had its worst performance since the 2008 financial crisis with a decline of 33%. The DAX declined 12.4% for the year, and stated its weakest performance since 2018. With a market capitalization of €118.5 billion at year end, SAP was once again the second most valuable company on the DAX.