SAP Steals Share From Oracle In Strong Quarter - InformationWeek
Government // Enterprise Architecture
08:59 AM
Connect Directly

SAP Steals Share From Oracle In Strong Quarter

Applications software license growth increased by 18%, versus 16% reported by Oracle in most recent quarter.

SAP reported a 26% increase in software revenue for the second quarter on Tuesday, with strong application sales besting Oracle's organic license growth and driving an overall increase of 14% in software and software-related service revenues at the company.

SAP's total revenue for the three-month period ended June 30 was 3.3 billion Euros ($4.76 billion), up 14% from the same period last year, according to international financial reporting standards (IFRS). The figures were even more impressive in constant currencies, with non-IRFS software sales increasing 35%, support revenues up 15%, and total software and software-related service revenues up 20%.

Reuters reported Wednesday that SAP's performance helped it gain market share against rival Oracle for the first time in 18 months. Based on analysis by Matrix Research and excluding results from Sybase, which was acquired last year, SAP's applications software license growth increased 18%, versus 16% reported by Oracle in its most recent quarter.

SAP's profit outlook was also strong, and the company confirmed yesterday that it will finish the year at the high end of its projected non-IFRS operating profit range of 4.45 billion to 4.65 billion Euros ($6.42 to $6.71 billion), up 10% to 14% over last year in constant currencies.

SAP executives told analysts that the company's four-pillar strategy of driving core applications sales together with the enhancements of in-memory computing (Hana appliance), mobile applications, and on-demand (Business ByDesign) services. But it appears that conventional on-premises apps were the real story, as the enhancement offerings have yet to make their biggest impact on the bottom line.

"We are witnessing a structural change in the IT market: Customers are shifting more of their investments toward software as it continues to become a larger and more important component of the overall technology stack," said Jim Hagemann Snabe, co-CEO of SAP, in statement on Tuesday's earnings release.

ERP is old news, but enhancing legacy software with mobile, analytics, and social apps can deliver substantial new value. Also in the new, all-digital issue of InformationWeek: SaaS can create new data silos unless companies follow best practices to make those apps work with on-premises systems and data sources. Download the issue now. (Free registration required.)

Comment  | 
Print  | 
More Insights
Newest First  |  Oldest First  |  Threaded View
User Rank: Apprentice
10/3/2011 | 7:15:31 AM
re: SAP Steals Share From Oracle In Strong Quarter
Good for SAP. They have always made better ERP software than Oracle and they do not insist on forcing one stack on the customer base in the process. Oracle's ERP strategy is a Trojan horse, bait and switch. You think you are buying ERP software, but they are really taking over all of your IT decision making. It is crazy that the so-called independent consultants do not make this clear to customers considering ERP at the outset.
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
2017 State of IT Report
In today's technology-driven world, "innovation" has become a basic expectation. IT leaders are tasked with making technical magic, improving customer experience, and boosting the bottom line -- yet often without any increase to the IT budget. How are organizations striking the balance between new initiatives and cost control? Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.
Twitter Feed
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.
Flash Poll