Whether you’re a business using SAP, or an SAP professional, it’s essential to know how the ERP giant has weathered the current global crisis. SAP has recently released its 2020 Q3 financial performance breakdown and we’re here to bring you the highlights.

SAP PRODUCT GROWTH THAT SAP PROFESSIONALS SHOULD KNOW

SAP has grown its cloud revenue by 11% to €1.984bn in Q3/20. Cloud revenue growth was the highest in Europe (22%), followed by Asia (14%) and the Americas (3%). In Europe, the combined revenue for cloud and software remained positive (2%) while in the Americas and Asia, it dipped slightly (-6% and -1% in Americas and Asia, respectively).

The growth in cloud demand and revenue worldwide is expected in light of COVID-19. With rapid digitalisation of organisations, the cloud plays a key role in moving operations online. Therefore, accelerated growth of the cloud platform should be a trend looking at the future. SAP has ambitious cloud future plans as the ERP is targeting more than €22bn in cloud revenue by 2025.

SAP has also continued to grow its S/4HANA customer base. In Q3/20 alone, the user count increased by 500 from 14,600 in Q2/20 to 15,100 in Q3/20. This is up 20% year over year. With the deadline for switching to a S/4HANA landscape extended to 2027, this number is of course expected to continue to rise.

SAP FINANCIAL PERFORMANCE THAT SAP PROFESSIONALS SHOULD KNOW

Overall, SAP saw a 4% decline in revenue in Q3/20 compared to Q3/19. However, considering the global crisis having shaken up the business world, this decline will be mitigated once the world economy picks back up.

Looking at SAP’s balance sheet, we’re actually seeing an improvement over the Q3/19 in terms of current assets which increased from €15.213bn to €15.617bn.

Despite the economic downturn, SAP showed strong double-digit growth in earnings per share and cash flow. In the quarter, earnings per share were up 26% to €1.32 and Operating cash flow was up 54% to €5.09bn.

SAP FINANCIAL SUMMARY FOR SAP PROFESSIONALS TO KNOW

We are in the midst of one of the most challenging periods for business in recent history. SAP has not only been able to avoid major losses but has sustained strong growth in the cloud as well as S/4HANA performance. SAP’s Business Update Third Quarter 2020 states, ‘SAP continues to serve its customers effectively with an embedded virtual sales and remote implementation strategy.’

We’re expecting to see quick recovery and improved processes coming out of the crisis which will make SAP even stronger in the future. See SAP’s recent presentation for full details on its Q3 results and the first 9 months of 2020.

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