SAP Net Profit Rises 21% on Strong Cloud Division

SAP SE (SAP) on Tuesday said its net profit for the fourth quarter rose 21%, driven by a solid performance of its cloud business.

The German software company said net profit for the three months was 1.85 billion euros ($2.29 billion) compared with EUR1.53 billion the year-earlier period. Total revenue was EUR6.81 billion, up 1%.

SAP said bookings for cloud services grew 22% in the period, reaching EUR591 million. Revenue at its cloud business grew 20% to EUR995 million.

The software company set its outlook for the full year 2018, which was based on calculations not recognized under international financial reporting standards. It expects non-IFRS operating profit to be between EUR7.3 billion and EUR7.5 billion at constant currencies, and non-IFRS total revenue of between EUR24.6 billion and EUR25.1 billion at constant currencies.

As of Jan. 1, SAP changed several of its accounting policies to apply standard IFRS 15, an accounting standard that sets out guidance for reporting revenue from contracts with customers. As a consequence, the year-over-year growth of revenue and profit in 2018 will be impacted by the new policies, SAP said.

In another release, the company said that its subsidiary SAP America Inc. has entered into an agreement to acquire CallidusCloud for $36 a share, representing an enterprise value of about $2.4 billion. The transaction is expected to close in the second quarter.

Write to Marc Navarro Gonzalez at marc.navarrogonzalez@dowjones.com

(END) Dow Jones Newswires

January 30, 2018 01:48 ET (06:48 GMT)