IoT
IoT
Software
News
1/29/2009
11:11 AM
50%
50%
RELATED EVENTS
Stop Cyber Attacks with Threat Intelligence
Aug 30, 2016
In this informative webinar on August 30th you will hear security experts discuss practical ways t ...Read More>>

SAP Weathers The Downturn

Fourth-quarter sales jump 8% on strength of services revenue.

Business software maker SAP is riding out the recession better than some of its peers. The German company Wednesday reported that software sales fell 7% in the fourth quarter, but the drop was more than offset by an 8% jump in services revenue.

"A lot of companies are using the downturn to get their house in order," said Bill McDermott, SAP's president of Global Field Operations, in an interview.

McDermott said a number of customers are using SAP's enterprise resource planning tools and services to consolidate operations and cut costs. "The services pipeline doesn't look too bad," he said.

SAP's overall fourth-quarter revenue rose 8% year over year, to $3.5 billion, while net income jumped 13% to $850 million. By contrast, Microsoft last month said quarterly profits plunged 11%.

SAP's 2008 numbers enjoyed a boost from the $6.8 billion acquisition of business intelligence software maker Business Objects in 2007. "It's fully integrated now," said McDermott.

Despite the gains, SAP plans to trim staff in order to deal with an economic environment that McDermott called "uncertain." The company began 2008 with 51,800 employees and will exit 2009 with about 48,500 workers. McDermott said SAP will rely heavily on attrition to achieve the reduction.

For the full year 2008, SAP reported a 6% increase in software revenue, a 14% rise in services revenue, and a 13% jump in overall sales. Net income for the year declined 2%, to $1.9 billion. Earnings per share rose 1% to $1.62. SAP did not provide financial guidance for 2009. "There's not a lot of visibility out there right now," said McDermott.

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
Google in the Enterprise Survey
Google in the Enterprise Survey
There's no doubt Google has made headway into businesses: Just 28 percent discourage or ban use of its productivity ­products, and 69 percent cite Google Apps' good or excellent ­mobility. But progress could still stall: 59 percent of nonusers ­distrust the security of Google's cloud. Its data privacy is an open question, and 37 percent worry about integration.
Register for InformationWeek Newsletters
White Papers
Current Issue
Top IT Trends to Watch in Financial Services
IT pros at banks, investment houses, insurance companies, and other financial services organizations are focused on a range of issues, from peer-to-peer lending to cybersecurity to performance, agility, and compliance. It all matters.
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Join us for a roundup of the top stories on InformationWeek.com for the week of August 14, 2016. We'll be talking with the InformationWeek.com editors and correspondents who brought you the top stories of the week to get the "story behind the story."
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.