German software giant SAP gets off to solid start in 2020 amid COVID-19 crisis

Source: Xinhua | 2020-04-22

Revenues of German software giant SAP increased by 7 percent to 6.52 billion euros (7.06 billion U.S. dollars) year-on-year in the first quarter (Q1) of the financial year 2020, the company announced on Tuesday.

The profit of SAP climbed to 811 million euros between January and March. A year ago, SAP had reported a quarterly loss of 108 million euros.

"Building on last year's momentum, SAP started the first two months of the quarter with strong momentum and healthy growth," said SAP CEO Christian Klein.

The impact of the COVID-19 crisis "rapidly intensified" towards the end of the quarter as a significant amount of new business was postponed, SAP noted.

This development was reflected, in particular, in the significant year-on-year decrease in revenues from software licenses which decreased by 31 percent year-on-year to 451 million euros, according to SAP.

However, the company managed to grow thanks to its cloud business which went up by 29 percent year-on-year and achieved revenues of around 2 billion euros in Q1 2020.

On Monday night local time, the company announced that SAP Co-CEO and member of the executive board Christian Klein would continue as sole CEO. Co-CEO Jennifer Morgan had "mutually agreed" with the supervisory board of SAP to leave the company on April 30.

SAP's decision to transfer from a dual to a single leadership model "was taken earlier than planned to ensure strong, unambiguous steering in times of an unprecedented crisis," the company noted. (1 euro = 1.08 U.S. dollars)