SAP(US:SAP)2025-01-29 11:01Cloud Performance - SAP's current cloud backlog reached €18.1 billion, up 32% year-over-year, and 29% at constant currencies[2] - Total cloud backlog increased to €63.3 billion, reflecting a 43% growth and 40% at constant currencies[2] - Cloud revenue for FY 2024 rose by 25% to €17.14 billion, with a 26% increase at constant currencies[20] - Cloud ERP Suite revenue surged by 33% to €14.17 billion, up 34% at constant currencies[9] - Cloud revenue for Q4 2024 was €4,708 million, with a year-over-year growth of 27%[49] - Cloud revenue for the full year 2024 was €17,141 million, representing a 25% increase from €13,664 million in 2023[54] - The Americas region contributed €7,872 million in cloud revenue for Q1–Q4 2024, a 19% increase from €6,642 million in Q1–Q4 2023[71] Financial Highlights - Total revenue for FY 2024 was €34.18 billion, marking a 10% increase year-over-year[20] - Total revenue for Q4 2024 reached €9,377 million, representing an 11% year-over-year increase[49] - Total revenue for Q1–Q4 2024 was €34,176 million, a 10% increase compared to €31,207 million in Q1–Q4 2023[71] - Free cash flow for the full year was down 19% to €4.11 billion, impacted by restructuring payouts of €2.5 billion and share-based compensation of €1.3 billion[24] - Free cash flow for Q4 2024 was reported at –€0.92 billion, down from €1.67 billion in Q4 2023[18] - Cash and cash equivalents at the end of Q4 2024 were €9,609 million, up from €8,124 million at the end of Q4 2023[55] Profitability Metrics - Non-IFRS operating profit increased by 25% to €8.15 billion, with a 26% rise at constant currencies[22] - IFRS operating profit decreased by 20% to €4.66 billion, primarily due to restructuring expenses of approximately €3.1 billion[22] - Operating profit (non-IFRS) for Q4 2024 was €2,436 million, showing a 24% increase compared to the previous year[49] - Profit after tax from continuing operations increased by 35% to €1,616 million, compared to €1,201 million in Q4 2023[52] - The company reported a total operating profit of €8,153 million for the year, a 26% increase from €6,514 million in 2023[63] Shareholder Returns - SAP's share repurchase program had an aggregate volume of up to €5 billion, with approximately €3.0 billion repurchased by December 31, 2024[27] - Earnings per share (basic, non-IFRS) for Q4 2024 was €1.40, up from €1.12 in Q4 2023[50] - Earnings per share (basic) from continuing operations rose by 31% to €1.37 in Q4 2024, up from €1.05 in Q4 2023[52] Employee Metrics - The number of employees at the end of Q4 2024 was 109,121, an increase from 107,602 in Q4 2023[50] - Customer Net Promoter Score (NPS) increased 3 points year over year to 12 in 2024, while employee engagement index decreased 6 percentage points to 74%[25] Future Outlook - SAP anticipates accelerating cloud revenue growth in 2025, supported by a strong position in data and Business AI[4] - For 2025, SAP expects cloud revenue to be between €21.6 billion and €21.9 billion, representing a growth of 26% to 28% at constant currencies[38] - SAP anticipates non-IFRS operating profit for 2025 to be between €10.3 billion and €10.6 billion, up 26% to 30% at constant currencies[38] - The effective tax rate (non-IFRS) is expected to be approximately 32% for 2025, consistent with 2024[38] Restructuring and Transformation - The 2024 Transformation Program is estimated to incur expenses of approximately €3.2 billion, with restructuring payouts of €2.5 billion for the full year[28] - Restructuring expenses in 2024 primarily related to a company-wide transformation program, with additions to the restructuring provision totaling €3,144 million[75] - The restructuring provision at the end of 2024 was €681 million, after utilizations of €1,061 million and transfers totaling €1,433 million[76] Acquisitions - SAP announced the acquisition of WalkMe Ltd. for approximately €1.3 billion, which closed on September 12, 2024[78] - WalkMe contributed approximately €61 million to revenue and approximately €-54 million to operating profit (IFRS) for the full year 2024[79] Changes in Reporting - SAP will change its cash flow statement presentation starting in 2025, moving interest paid and received to financing and investing activities, respectively[81] - The new definition of free cash flow (FCF) will include proceeds from sales of intangible assets and property, plant, and equipment, reflecting a more comprehensive cash flow evaluation[84] - Under the new FCF definition, the estimated impact for 2025 is approximately €0.2 billion positive effect[86]