Core Insights - DataXstream's OMS+ Intelligent Automation (IA) has been certified by SAP as built with SAP Business AI, confirming its compliance with SAP's standards for responsible and enterprise-ready AI [1][4] - The certification signifies a significant advancement in integrating AI within SAP environments, enhancing order management processes for SAP customers [2][3] Product Features - OMS+ IA enhances DataXstream's sales order management platform with intelligent automation, enabling SAP customers to streamline complex order processes and accelerate fulfillment [3] - Key capabilities of OMS+ IA include document automation, an IA chatbot for task completion, blueprint scraping for generating Bills of Materials, typeahead search for real-time predictions, and material & customer matching for live data retrieval [5] Company Background - DataXstream is an SAP Endorsed App Partner focused on developing solutions that maximize the ROI of SAP infrastructure, with products available in the SAP Store [6] - The company has also achieved Premium Certification for its OMS+ Cloud solution for SAP S/4HANA Cloud Public Edition, becoming the first partner to complete SAP's scalable delivery process for the Public Cloud [8]

Financial Data and Key Metrics Changes - In Q2, cloud revenue rose by 28%, marking an increase of two percentage points compared to Q1 [7][28] - Total revenue growth accelerated to 12% [8][34] - Current cloud backlog grew by 28% in Q2, reaching €18.1 billion [28][34] - Operating profit surged by 35%, reflecting improvements in the cost base due to the transformation program [9][33] - Non-IFRS operating profit increased to €2.6 billion [34] Business Line Data and Key Metrics Changes - The Cloud ERP suite continued to drive growth, achieving 34% growth in Q2, representing 86% of total cloud revenue [29][34] - Software licenses revenue decreased by 13% in Q2, aligning with the company's strategy to transition to cloud-based models [31][34] Market Data and Key Metrics Changes - Cloud revenue performance was particularly strong in the APJ and EMEA regions, with notable performances in Brazil, Chile, France, India, Italy, South Korea, and Spain [32][34] - The Americas showed solid performance, although specific figures were not disclosed [32] Company Strategy and Development Direction - The company is focusing on product innovation and increasing productivity through business AI [6][25] - SAP aims to strengthen its portfolio with data and AI innovations while maintaining cost discipline [26][35] - The partnership with Alibaba is expected to enhance market potential in China, targeting both existing and new customers [10][61] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing uncertainty in global markets but expressed confidence in the company's pipeline for the second half of the year [6][30] - The company is preparing for less favorable outcomes by focusing on elements within its control to protect its bottom line and free cash flow [31][35] - Management remains optimistic about sustaining momentum and closing the year strongly despite macroeconomic volatility [35] Other Important Information - The company released its first 14 AI agents in the first half of the year, with plans to increase this number to 40 by year-end [19][20] - The non-IFRS cloud gross margin expanded by 1.8 percentage points to 75.2% [33] Q&A Session Summary Question: Insights on operating margin and EBIT growth for the second half - Management highlighted that the strong performance in operating profit was partly due to a €331 million improvement in stock-based compensation, which is expected to have easier comparisons in the first half [42][44] Question: Long-term sustainability of margin improvements - Management expressed confidence in maintaining operating leverage ratios of 80-90% for the coming years, despite some continuous adjustments in workforce [54][56] Question: Details on the Alibaba partnership and its impact - The partnership aims to enhance SAP's presence in China, focusing on both large enterprises and the upper mid-market [61][62] Question: Impact of transformation credits on cash flow - Transformation credits are amortized over the term of the deal, and while they may create initial cash conversion challenges, they are neutral over the life of the transaction [68][70] Question: Demand impact on CCB and cloud revenue - Management noted that while there is a slight deceleration expected, the pipeline coverage remains strong, and customers are responding positively to business cases [80][100]

Financial Data and Key Metrics Changes - In Q2 2025, cloud revenue rose by 28%, an increase of two percentage points compared to Q1 2025 [8][27] - Total revenue growth accelerated to 12%, reaching €9 billion [9][33] - Operating profit surged by 35%, reflecting improvements in the cost base due to transformation programs [9][32] - Current cloud backlog grew by 28% to €18.1 billion [27][33] - Non-IFRS cloud gross margin expanded by 1.8 percentage points to 75.2% [32] Business Line Data and Key Metrics Changes - The Cloud ERP suite continued to drive growth, achieving 34% growth in Q2, representing 86% of total cloud revenue [27][32] - Software licenses revenue decreased by 13% in Q2, aligning with the company's strategy to transition customers to cloud solutions [30] Market Data and Key Metrics Changes - Cloud revenue performance was particularly strong in the APJ and EMEA regions, with notable performances in Brazil, Chile, France, India, Italy, South Korea, and Spain [31] - The US public sector and manufacturing sectors experienced elongated sales cycles due to geopolitical uncertainties [28][30] Company Strategy and Development Direction - The company is focusing on product innovation and increasing productivity through business AI [7][25] - SAP aims to strengthen its portfolio with data and AI innovations while maintaining cost discipline [25][34] - The partnership with Alibaba is expected to enhance market penetration in China, targeting both large enterprises and the upper mid-market [10][60] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing uncertainty in global markets but expressed confidence in the company's pipeline for the second half of the year [7][34] - The company is preparing for potential less favorable outcomes by focusing on elements within its control to protect its bottom line [30] - Management remains optimistic about sustaining momentum and closing the year strongly despite macroeconomic volatility [34] Other Important Information - The company has released over 100 pre-built SAP managed data products, with plans to double that by year-end [21] - The internal adoption of business AI is expected to further enhance productivity and operational efficiency [22][24] Q&A Session Summary Question: Insights on operating margin and EBIT growth for the second half of the year - Management highlighted that the strong performance in the first half was significantly influenced by a €331 million improvement in stock-based compensation, which is expected to normalize in the second half [41][42] Question: Long-term sustainability of margin improvements - Management expressed confidence in maintaining operating leverage ratios between 80% to 90% for the coming years, despite potential fluctuations in expenses [52][53] Question: Details on the Alibaba partnership and its impact - The partnership aims to leverage Alibaba's presence in China to enhance SAP's cloud offerings, targeting both multinational companies and local tech firms [60][63] Question: Impact of macroeconomic factors on demand - Management noted that elongated deal cycles are primarily due to stricter cost controls in certain industries, but emphasized that the pipeline remains strong [97][100] Question: Cash flow and transformation credits - Management explained that transformation credits are amortized over the term of deals and do not significantly impact cash conversion in the long term [66][67]

Core Insights - Infosys has launched the Infosys Enterprise Innovation Lab for SAP Solutions in Düsseldorf, Germany, aimed at accelerating enterprise transformation through AI, data, and cloud solutions [1][2][3] - The lab will facilitate co-creation of tailored solutions to address business challenges and enhance operational efficiency, financial performance, and decision-making through real-time data insights [2][3] Group 1: Lab Features and Offerings - The lab will provide access to Infosys Topaz and SAP Business AI, enabling organizations to discover possibilities and develop practical applications [5] - It offers a collaborative workspace for customers and experts to co-create AI solutions tailored to specific business needs [5] - The lab aims to create a foundation for designing AI and data strategies that align with business goals through clear plans and use cases [5] Group 2: Strategic Collaboration - Infosys and SAP are collaborating to revolutionize business transformation by integrating enterprise-wide data to fuel AI-based solutions [2][3] - The partnership emphasizes the importance of faster, flexible transformations with lasting value, leveraging AI-powered innovation and seamless cloud adoption [3] - Infosys has over 25 years of expertise in SAP software transformation, which will be utilized to develop cloud and AI solutions across various industries [3] Group 3: Business Outcomes - The collaboration aims to empower businesses to leverage the full potential of cloud, data, and AI, resulting in enhanced efficiency, improved decision-making, significant cost savings, and future-readiness [3] - Solutions developed in the lab will be available across Infosys' global network of over 12 Living Labs, expanding the reach and impact of these innovations [2]

Core Viewpoint - In the ongoing digital transformation, companies must either become self-disruptors or risk becoming mere spectators of the era. SAP's AI transformation has successfully aligned technology, ecosystem, and business model evolution, leading to robust growth through strategic investments and customer-centric product iterations [1][2][22]. Group 1: SAP's Transformations - SAP has undergone four significant transformations since its inception in 1972, each aligned with major technological waves: the internet, mobile computing, cloud technology, and currently, artificial intelligence [2][13]. - The first transformation (1999-2009) involved SAP's response to the internet, marked by the launch of mySAP.com, which integrated e-commerce and supply chain management [4][5][8]. - The second transformation (2010-2015) was characterized by the acquisition of Sybase for mobile capabilities and the integration of cloud solutions, including the purchase of SuccessFactors [11][12][14]. - The third transformation (2015-2020) focused on full cloud integration with the launch of S/4HANA and the SAP Cloud Platform, which significantly increased cloud subscription revenue [16][17]. - The ongoing fourth transformation (2020-present) emphasizes the integration of generative AI into SAP's offerings, including the GROW with SAP solution launched in partnership with Amazon Web Services [18][21]. Group 2: Financial Performance - SAP's cloud ERP suite revenue reached €14.166 billion in 2024, up from €10.626 billion in 2023, reflecting a strong growth trajectory [26]. - Total revenue for SAP in 2024 was €34.176 billion, compared to €31.207 billion in 2023, indicating a robust overall performance [26]. - The cloud business revenue growth rate was 25% year-over-year in Q2 2024, with a total order volume of €148 billion, showcasing the effectiveness of SAP's integration strategies [21][25]. Group 3: AI Strategy and Investments - SAP plans to invest nearly €1 billion over the next two years to develop AI use cases and enhance its business transformation toolkit through acquisitions [38]. - The company has made significant acquisitions to bolster its AI capabilities, including LeanIX and WalkMe, which support its "continuous business transformation" strategy [19][24]. - SAP's AI strategy includes the integration of AI into core business processes, with a focus on enhancing user efficiency and automating tasks across various business functions [35][37]. Group 4: Challenges and Solutions - Prior to its AI transformation, SAP faced challenges such as low adoption rates of early AI tools and difficulties in integrating AI with core business processes [27][30]. - The company has recognized the need for robust risk management frameworks to address potential issues related to algorithm biases and data quality [40][41]. - SAP's approach to AI has evolved from initial testing to full integration, emphasizing practical applications and compliance with ethical standards [31][34].

Core Insights - DXC Technology has launched DXC Complete with SAP and Microsoft to facilitate modernization for SAP customers, providing a streamlined approach to adopting RISE with SAP and GROW with SAP journeys on Microsoft Azure [1][2][3] - The offering includes flexible pricing models and a single contract, enabling enterprises to optimize operations and achieve sustainable growth through transformation to SAP S/4HANA Cloud [1][3] Company Overview - DXC Technology is recognized as a leading global technology services provider, helping businesses modernize IT and optimize data architectures while ensuring security and scalability across various cloud environments [7] - The company has a global team of over 50,000 engineers and consultants, delivering tailored SAP solutions that address industry-specific challenges and drive measurable results [6] Collaboration Highlights - The collaboration between DXC, SAP, and Microsoft aims to simplify technology landscapes, reduce technical debt, and accelerate innovation for clients [2][3] - Microsoft Azure integration with SAP Business AI enhances intelligent automation, predictive insights, and streamlined processes, creating a more connected enterprise [6] Awards and Recognition - DXC Technology has been named a 2025 SAP Pinnacle Awards Winner in the "Partner Learning and Skills Growth" category, highlighting its excellence in co-innovation and customer success [4]

Financial Data and Key Metrics Changes - Current cloud backlog increased by 29% to €18.2 billion in Q1 [5][37] - Quarterly cloud revenue grew by 26%, approaching the €5 billion mark [5][37] - Total revenue rose by 11% to €9 billion [42] - Operating profit surged by 58% to €2.5 billion, significantly exceeding the guidance for the year [41][45] - Cloud gross margin improved by 2.6 percentage points to 75% [6][40] Business Line Data and Key Metrics Changes - Cloud ERP suite revenue maintained high growth momentum with a 33% increase in Q1, accounting for 85% of total cloud revenue [37] - Software licenses decreased by only 10%, indicating resilience despite being a smaller quarter [38] - Approximately half of cloud order entries included AI use cases, reflecting strong demand for AI integration [13] Market Data and Key Metrics Changes - Strong cloud revenue performance noted in APJ and EMEA regions, with Brazil, Germany, and India showing outstanding results [40] - The Americas region also demonstrated robust performance, with notable strength in Canada and the US [40] Company Strategy and Development Direction - Company emphasizes a suite-first, AI-first approach to expand its offerings [36] - Focus on product innovation, particularly with the launch of Business Data Cloud, which aims to unify and govern business data [22][23] - Continued investment in AI and cloud solutions to enhance customer productivity and reduce implementation costs [30][31] Management's Comments on Operating Environment and Future Outlook - Management expresses confidence in the company's resilience despite high market uncertainty [9][45] - The pipeline for the year remains solid, with no significant deterioration in conversion rates observed [56] - Management acknowledges potential risks from geopolitical tensions and trade disputes but maintains a positive outlook for long-term growth [44][120] Other Important Information - The company plans to provide deeper insights into its growth strategy at the upcoming Sapphire event in May [34][47] - The transformation program concluded in 2024, positioning the company for focused investments in key areas [36] Q&A Session Summary Question: Current trading and confidence in cloud revenue guidance - Management noted strong customer engagement and resilience in supply chains, which supports confidence in cloud revenue guidance despite macro uncertainties [52][56] Question: Deceleration in cloud revenue growth - Management explained that the deceleration was influenced by the timing of cloud deals and expected a rebound in Q2 as these deals ramp up [58][62] Question: Current cloud backlog performance - Current cloud backlog performance was in line with expectations, with no significant changes in customer dynamics despite tariff uncertainties [68][71] Question: Product innovation and Business Data Cloud differentiation - Management clarified that Business Data Cloud offers a more comprehensive solution than the previous SAP Datasphere, enabling better data integration and AI capabilities [78][83] Question: Impact of tariffs on business and cloud margins - Management indicated that while tariffs could impact hardware costs, the company's multi-cloud strategy provides price security and mitigates risks [130][132]