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SAP AG (SAP) Reports In-Line Q4 EPS; Lowers FY14 Operating Profit Outlook

October 20, 2014 6:43 AM EDT

SAP AG (NYSE: SAP) reported Q4 EPS of €0.84, in-line with the analyst estimate of €0.84. Revenue for the quarter came in at €4.25 billion versus the consensus estimate of €4.27 billion.

BUSINESS OUTLOOK 2014

The Company updated its outlook for the full year 2014.

Based on the strong momentum in SAP's cloud business, the Company is raising its cloud outlook again and now expects full year 2014 non-IFRS cloud subscriptions and support revenue to be in a range of €1,040 – €1,070 million (previously €1,000 – €1,050 million) at constant currencies (2013: €757 million). The upper end of this range represents a growth rate of 41%. The Company continues to expect full year 2014 non-IFRS software and software-related service revenue to increase by 6% – 8% at constant currencies (2013: €14.03 billion).

With the customer-driven mix shift from upfront to cloud subscription revenue the Company now expects full-year 2014 non-IFRS operating profit to be in a range of €5.6 billion – €5.8 billion (previously €5.8 – €6.0 billion) at constant currencies (2013: €5.48 billion).

SAP anticipates the fast-growing cloud business along with growth in support revenue will drive a higher proportion of more predictable revenue in the future.

The 2014 business outlook does not include any contributions from the planned addition of Concur Technologies, Inc.

While the Company's full-year 2014 business outlook is at constant currency, actual currency reported figures are expected to continue to be impacted by currency exchange rate fluctuations. If exchange rates remain at the September 2014 level for the rest of the year, the Company expects non-IFRS software and software-related service revenue and non-IFRS operating profit growth rates at actual currency to experience a positive currency impact of approximately 3 percentage points and 3 percentage points respectively for the fourth quarter of 2014 and a negative currency effect of approximately 1 percentage points and neutral impact respectively for the full year 2014.

For earnings history and earnings-related data on SAP AG (SAP) click here.



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