SAP Announces Q3 2024 Results

Core Insights - SAP reported strong financial results for Q3 2024, with significant growth in cloud revenue and an optimistic outlook for the remainder of the year [2][4][5] Financial Performance - Current cloud backlog increased by 25% to €15.4 billion, up 29% at constant currencies [2][4] - Cloud revenue rose by 25% to €4.35 billion, with a 27% increase at constant currencies [2][4] - Cloud ERP Suite revenue grew by 34% to €3.64 billion, up 36% at constant currencies [2][4] - Total revenue increased by 9% to €8.47 billion, with a 10% rise at constant currencies [2][4] - IFRS cloud gross profit was up 26% to €3.18 billion, while non-IFRS cloud gross profit increased by 27% to €3.21 billion [2][4] - Operating profit rose by 29% to €2.21 billion, with non-IFRS operating profit up 27% to €2.24 billion [2][4] Earnings and Cash Flow - Basic earnings per share from continuing operations increased by 15% to €1.25 [2][4] - Free cash flow for Q3 increased by 44% to €1.25 billion, with a total of €5.03 billion for the first nine months of 2024 [4][5] Strategic Initiatives - SAP is focusing on business AI and has initiated a company-wide restructuring program expected to conclude in early 2025, affecting 9,000 to 10,000 positions [4][5] - The company has repurchased 16,709,250 shares at an average price of €157.09, totaling approximately €2.62 billion under its share repurchase program [4][5] Financial Outlook - SAP raised its 2024 outlook for cloud and software revenue to €29.5 – 29.8 billion, up 10% to 11% at constant currencies [5][6] - The expected non-IFRS operating profit for 2024 is now €7.8 – 8.0 billion, reflecting a 20% to 23% increase at constant currencies [5][6] - Free cash flow outlook for 2024 is projected at €3.5 – 4.0 billion [5][6] Customer Engagement - Numerous global customers are adopting SAP solutions, including "RISE with SAP" and "GROW with SAP," indicating strong market demand [5] - SAP's cloud revenue performance was particularly robust in the APJ and EMEA regions, with notable growth in countries like Brazil, Germany, and India [5]