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SAP Co-CEO upbeat despite lower than expected Q1 results

Friday, April 19, 2013 - 01:23

April 19 - SAP Co-CEO Jim Hagemann Snabe tells Reuters the German software company is gaining 'radical market share', despite missing analysts' forecasts for Q1 results.

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(ROUGH CUT ONLY - NO REPORTER NARRATION) German business software maker SAP reported lower than expected first quarter results on Friday, due to problems with its Asia-Pacific business. The company's first quarter operating profit excluding special items rose 8 per cent to 901 million euros, missing an average forecast of 968 million in a Reuters poll of analysts. The Asian business stumbled at the start of 2013 when top sales managers left the company, giving rivals an edge just as customers were switching from hardware to cloud computing. Nonetheless SAP Co-CEO Jim Hagemann Snabe says the company is executing extremely well and is confident about growth opportunities in Asia. He also said SAP is gaining radical market share as the industry undergoes what he describes as 'radical transformation.' SAP shares were down 2.8% at 1100GMT on Friday. (SOUNDBITE)(English) SAP CO-CEO JIM HAGEMANN SNABE SAYING: "I think we are delivering now a very strong quarter again, the thirteenth consecutive quarter of double digit growth. We are growing on a global scale, our software and cloud business by 25 per cent. And don't forget everyone else in IT is going down. And we're also increasing our operating income by 11 per cent, most importantly our strategic innovations like 'HANA' is a home run this quarter, tripling its revenue, becoming the preferred innovation platform. So I think we're executing extremely well. We did have some execution issues in Asia-Pacific, they are about how do you scale a business that's rapidly growing six years, and I feel good even about the growth opportunities in Asia." (SOUNDBITE)(English) SAP CO-CEO JIM HAGEMANN SNABE SAYING: "I think what's happening is a radical transformation of the industry. A transformation that we predicted already three years ago and have been fuelling in many ways. If you look at the numbers across the sector, most companies have no growth or negative growth. Hardware is in trouble and we see growth rates of 25 per cent - 15 in Europe - more than 50 per cent in Americas, which means there's a shift in the spend. It's not that the spend on IT is going down. Technology is more important than ever. But there's a shift to innovative business solutions like 'HANA' and therefore we're gaining radical market share."

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SAP Co-CEO upbeat despite lower than expected Q1 results

Friday, April 19, 2013 - 01:23