IoT
Software
News
1/29/2009
11:11 AM
50%
50%
RELATED EVENTS
The Analytics Job and Salary Outlook for 2016
Jan 28, 2016
With data science and big data top-of-mind for all types of organizations, hiring analytics profes ...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
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
How to Knock Down Barriers to Effective Risk Management
Risk management today is a hodgepodge of systems, siloed approaches, and poor data collection practices. That isn't how it should be.
Video
Slideshows
Twitter Feed
InformationWeek Radio
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.