SAP Investor Relations

CeBIT Trade Show / Financial Analyst and Investor Program

June 12, Hanover, Germany

Luka Mucic
Chief Financial Officer, SAP SE
Publication of First Quarter 2018 Results

Company Profile

Founded in 1972, SAP is a global company headquartered in Walldorf, Germany. SAP is the market leader in enterprise application software and also the leading analytics and business intelligence company. In 2017, SAP was ranked as the most sustainable software company in the Dow Jones Sustainability Index for the eleventh consecutive year. With more than 388,000 customers in more than 180 countries, the SAP Group has a global presence and employs more than 91,000 people.

Find more company information here.

Our Vision for the Intelligent Enterprise

In the digital era, data is the “new currency” in an enterprise. Businesses that are able to harness their data faster and more effectively will be the ones that succeed through disruption.

As the world’s largest enterprise software company, SAP offers perspective on the massive scale and power of data. Our customers have a vast amount of enterprise data assets flowing through our SAP ERP and cloud applications and business networks every day. Our enterprise resource planning applications touch 77% of global transaction revenue, we run the world’s largest business network with over US$1 trillion in commerce annually, and we have over 150 million users of our cloud applications.

Learn more about the Intelligent Enterprise.

Bringing Continuous Innovation to Our Customers

Today companies are faced with the question of how they transform into a digital business. To support our customers’ transformation to become true digital enterprises, we offer end-to-end solutions across 25 industries and 12 lines of business, localized by country and for companies of any size, both on-premise and in the Cloud. In 2017, our IFRS R&D expenses as a portion of total operating expenses was 18.0% and R&D headcount was 28% of total headcount. As at December 31, 2017, SAP held a total of more than 8,852 validated patents worldwide. Of these, 845 were granted and validated in 2017.

Find a full list of our products and solutions here.

Successful Transition of Business Model

We have a powerful combination of a fast-growing cloud business and a growing core. SAP anticipates that the fast-growing cloud business along with growth in support revenue will drive a higher share of more predictable revenue. SAP expects the total of cloud subscriptions & support revenue and software support revenue to be in a range of 70% – 75% of total revenue in 2020.

See the most recent quarterly results presentation (PDF).

Find more details in the Investor Relations fact sheet (PDF).

Most Frequent Questions

What are the IFRS 15 implications on SAP's 2018 financials?

As of January 1, 2018, SAP changed several of its accounting policies to adopt IFRS 15 ‘Revenue from Contracts with Customers’. Under the IFRS 15 adoption method chosen by SAP prior years are not restated to conform to the new policies. Consequently, the year-over-year growth of revenue and profit in 2018 will be impacted by the new policies.

The Company expects the impact of the policy change^* on revenue, operating expenses and profit to be as follows:

Revenues are expected to experience a benefit of substantially less than €0.1 billion with most of the difference resulting from exercises of customer software purchase options granted in prior years which result in software revenue.
Operating expenses are expected to benefit, in cost of sales and marketing, in the amount of approximately €0.2 billion from higher capitalization of sales commissions. Other policy changes will weigh on operating expenses with an additional cost of revenue of substantially less than €0.1 billion.
The above-mentioned effects will result in a net positive impact on operating profit of approximately €0.2 billion.

For more details on the implications of IFRS 15 SAP’s 2018 financials please refer to the video with Dr. Christoph Huetten, SAP’s Chief Accounting Officer.

SAP will announce its 2018 outlook together with the preliminary Q4 and full year 2017 results on January 30th before the opening of the Frankfurt Stock Exchange.

*) “Impact of the accounting policy change” means the difference between a revenue and profit measure determined under SAP’s new IFRS 15-based policies and the respective measure as it would stand had our previous accounting policies continued to apply.

View the explanatory video

View the detailed presentation

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What is your outlook 2018?

SAP is raising its outlook to reflect the closing of the Callidus acquisition on April 5, 2018 as well as the strong operating profit performance in the first quarter. For the full year 2018, the Company now expects:

Non-IFRS cloud subscriptions and support revenue to be in a range of €4.95 billion − €5.15 billion at constant currencies (2017: €3.77 billion), up 31% – 36.5% at constant currencies. The previous range was €4.8 − €5.0 billion. Callidus is expected to contribute approximately €150 million.
Non-IFRS cloud and software revenue to be in a range of €20.85 – €21.25 billion at constant currencies (2017: €19.55 billion), up 6.5% – 8.5% at constant currencies. The previous range was €20.7 – €21.1 billion. Callidus is expected to contribute approximately €150 million.
Non-IFRS total revenue to be in a range of €24.80 billion − €25.30 billion at constant currencies (2017: €23.46 billion), up 5.5% – 7.5% at constant currencies. The previous range was €24.6 – €25.1 billion. Callidus is expected to contribute approximately €200 million.
Non-IFRS operating profit to be in a range of €7.35 billion − €7.50 billion at constant currencies (2017: €6.77 billion), up 8.5% – 11% at constant currencies. The previous range was €7.3 – €7.5 billion. Callidus is expected to contribute approximately €10 million.

While SAP’s full-year 2018 business outlook is at constant currencies, actual currency reported figures are expected to be impacted by currency exchange rate fluctuations as the Company progresses through the year.

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What is your vision and mission?

In the digital era, data is the “new currency” in an enterprise. Businesses that are able to harness their data faster and more effectively will be the ones that succeed through disruption.

As the world’s largest enterprise software company, SAP offers perspective on the massive scale and power of data. Our customers have a vast amount of enterprise data assets flowing through our SAP ERP and cloud applications and business networks every day. Our enterprise resource planning applications touch 76% of global transaction revenue, we run the world’s largest business network with over US$1 trillion in commerce annually, and we have over 150 million users of our cloud applications.

SAP software and technologies can deliver deep value to our customers by providing the tools to harness the power of the data flowing through their systems. Our vision for the intelligent enterprise is an event-driven, real-time business powered by intelligent applications and platforms. In this vision, enterprise data sits at the core of a virtuous cycle whereby:

Enterprises will combine proprietary data assets from their internal systems of record with real-time, external data feeds to train intelligent algorithms.
Intelligent algorithms will be embedded into core business processes to enable enterprises to increase their awareness of events and respond in real time.
As the cycle repeats itself, enterprises will produce even richer datasets based on business outcomes that can be used to train the next generation of increasingly intelligent algorithms.

By embedding intelligence in core processes, businesses of all sizes will benefit from the automation of routine tasks and improved decision-making driven by advanced analytics.

Combining intelligent algorithms with empowered employees will allow companies to free up scarce resources to focus on what matters most – driving value for their customers. In this way, we can fulfill our promise of enabling our customers to Run Simple, while helping the world run better and improving people’s lives.

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Why does SAP report Non-IFRS financial results?

SAP reports its financial results in accordance with IFRS and additionally discloses certain financial results on a non-IFRS basis. Certain non-IFRS measures (for example non-IFRS revenue, non-IFRS operating profit and non-IFRS operating margin) are provided both, on a nominal currency basis (as reported basis) and on a constant currency basis.

Read more (PDF)

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When does SAP pay out dividends?

SAP pays a dividend once a year. The SAP Executive and Supervisory Boards jointly recommend the dividend amount. It is based on the SAP SE financial statements. The amount of dividend requires the shareholders’ approval and is officially decided upon at the SAP Annual General Meeting of Shareholders. Payout usually occurs on the third business day following our Annual General Meeting of Shareholders. For information about SAP's dividends policy, access the Dividends section on the stock page.

Note to holders of SAP ADRs (American Depositary Receipts): One SAP ADR represents one SAP share. The final dividend is dependent upon the Euro/US-Dollar exchange rate. SAP pays cash dividends on the ordinary shares in Euro, so exchange rate fluctuations will affect the US-Dollar amounts received by holders of ADRs, depending on the foreign exchange rate at the time of the conversion of the dividend cash from Euro to US-Dollar. The final dividend payment by SAP to the depositary bank is usually scheduled for the third day after the Annual General Meeting of Shareholders. The depositary bank will then convert the dividend payment from Euro into US-Dollar as promptly as practicable.

ADR investors can invest all or a portion of the cash dividends paid on SAP ADRs through our Dividend Reinvestment Program, operated in cooperation with the Deutsche Bank Trust Company Americas. Visit www.adr.db.com and click on the "DB-Direct" icon for more information about this program.

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What is SAP S/4HANA?

SAP S/4HANA is our enterprise resource planning (ERP) suite for the intelligent enterprise. Three years after its introduction, over 8,300 customers have chosen the suite to support their digital transformation. It enables businesses to access and analyze data in real time, giving them insights to act in the moment, providing predictive suggestions, and connecting business functions and the people within them.

SAP S/4HANA software spans across all business functions including finance, human resources, sales, service, procurement, manufacturing, asset management, supply chain, and R&D.

Flexible Deployment

SAP S/4HANA is developed first for the cloud, and can be delivered as a software-as-a-service (SaaS) solution, on premise, in a private cloud, or as a hybrid deployment. All consumption options are compatible, so that organizations have the flexibility to implement SAP S/4HANA to meet their exact needs. SAP S/4HANA Cloud provides SaaS qualities such as scalability as well as quarterly innovation updates. On-premise customers receive the same updates but on an annual update cycle.

Real Time

SAP S/4HANA is built specifically to take advantage of in-memory computing with SAP HANA. SAP S/4HANA reduces both the complexity of the data model and the data footprint. It enables SAP S/4HANA solutions to process huge amounts of data in real time and end users can flexibly change their perspective of the data. This not only saves time and costs for our customers but also delivers a new interactive experience and new business insights. SAP S/4HANA empowers business users to act in the moment, as they have immediate access to information at the most granular level to help make better, more informed decisions.

Find more information on SAP S/4HANA here

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See all Questions and Answers

Main acquisitions

We take a balanced approach on how we grow. We will continue to focus on organic investments in technology and innovations to drive our short-term and midterm growth ambitions. We will continue to look at unleashing the full potential of our employees’ talent as well as strategic partnerships with our ecosystem to foster innovation.

Additionally, we occasionally acquire targeted “tuck-in” technologies to add to our broad solution offerings and improve coverage in key strategic markets.

2018

Callidus Software Inc.
SAP SE (NYSE: SAP) and Callidus Software Inc. (doing business as CallidusCloud®) (Nasdaq: CALD) announced on January 30, 2018 that SAP America, Inc. has entered into an agreement to acquire CallidusCloud, the leader in cloud-based Lead to Money (Quote-to-Cash) solutions. On April 5, 2018, the acquisition has been successfully completed.

Read the Announcement Press Release of January 30, 2018
Read the Closing Press Release of April 5, 2018

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2014

Fieldglass
On March 26, 2014, SAP AG (NYSE: SAP) announced plans to acquire Fieldglass, the leading technology provider for procuring and managing contingent labor and services. The addition of Fieldglass’ cloud-based Vendor Management System (VMS) solution meets the growing demand among employers to manage flexible workforces that can be quickly engaged and on-boarded to support rapidly changing business and customer needs. The acquisition was closed on May 2, 2014.

Read the press release of March 26, 2014

Concur
SAP SE and Concur Technologies, Inc. ('Concur') announced on September 18, 2014 that SAP SE's subsidiary, SAP America, Inc., has entered into an agreement to acquire Concur. On December 4, 2014, the acquisition has been successfully completed.

Read the Announcement Press Release
Read the Closing Press Release
Read the legal documents and SEC-filings of the Concur merger

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2013

hybris
On June 5, 2013,- SAP AG and hybris announced that SAP plans to acquire hybris, a rapidly growing and widely recognized leader in e-commerce technology. The acquisition positions SAP to deliver the next-generation e-commerce platform, with the choice of on-premise or cloud deployment, as enterprises around the world seek to optimize the customer experience for businesses and consumers across an ever-growing number of delivery channels, devices and touch points.

Read the press release of June 5, 2013 (announcement of acquisition)
Read the press release of August 1, 2013 (completion of acquisition)

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2012

Ariba
On May 22, 2012, SAP AG and Ariba, Inc. announced that SAP's subsidiary, SAP America, Inc., has entered into an agreement to acquire Ariba, the leading cloud-based business commerce network, for $45.00 per share, representing an enterprise value of approximately $4.3 billion. The acquisition was completed on October 1, 2012, and combines Ariba's successful buyer-seller collaboration network with SAP's broad customer base and deep business process expertise to create new models for business-to-business collaboration in the cloud.

Read the Announcement Press Release
Read the Closing Press Release

Shareholders who still hold Ariba shares or have any other questions regarding their Ariba shares should call Computershare in the US at +1 201-680-3708.

Syclo
In June 2012, we acquired Syclo, a leading provider of solutions for asset management, for the field service and inventory management. The addition of Syclo's expertise in building and selling mobile solutions in industries such as utilities, oil and gas, life sciences, and manufacturing will enhance SAP mobile solutions.

Read the press release of April 10, 2012

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2011

SuccessFactors
SAP and SuccessFactors announced on December 3, 2011, that SAP's subsidiary, SAP America has entered into a definitive merger agreement with SuccessFactors, the market-leading provider of cloud-based human capital management (HCM) solutions. Following the successful closing of SAP's cash tender offer for all issued and outstanding shares of SuccessFactors, Inc. (NYSE: SFSF) ("SuccessFactors"), SAP and SuccessFactors announced on February 23, 2012, that SAP has completed the acquisition of SuccessFactors.

Read the Announcement Press Release
Read the Closing Press Release

Shareholders who still hold SuccessFactors shares or have any other questions regarding their SuccessFactors shares should call Georgeson at US +1 877 507 1756

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2010

Sybase
On May 12, 2010 SAP and Sybase, Inc., Dublin, California (USA) announced that SAP's subsidiary, SAP America, Inc., has signed a definitive merger agreement to acquire Sybase, Inc., in a transaction that will bring the two information technology (IT) leaders together to enable companies to become better-run "unwired enterprises."

As a result of this transaction, customers will be able to better harness today's explosion of data and deliver information and insight in real time to business consumers wherever they work so that they can make faster, more informed decisions. Companies will benefit from greater productivity, speed and agility to help their businesses grow.

On July 27, 2010 - SAP AG announced the completion of the cash tender offer for all outstanding shares of common stock of Sybase, Inc., by Sheffield Acquisition Corp., a wholly-owned subsidiary of SAP,

Read the Announcement Press Release
Read the Closing Press Release

For holders of Sybase shares, please call American Stock Transfer (AST) at +1 800 937 5449

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2007

BusinessObjects
On October 7, 2007, SAP AG and Business Objects S.A. announced that the companies have reached an agreement that will bring together two of the information technology industry's leaders, resulting in an unmatched offering for Business Users, enabling timely and accurate decision-making.

On January 15, 2008, SAP France S.A. ("SAP France"), SAP AG and Business Objects S.A. announced today that SAP France's all-cash tender offers for Business Objects securities were successful.

Read the Announcement Press Release
Read the Closing Press Release

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