The mixed results from SAP, and poor outlook for 2009 has prompted the enterprise resource planning (ERP) company to cut 3000 jobs and freeze salaries.
The workforce will be cut to 48,500 by the end of 2009, from 51,536 staff, resulting in more than 3000 redundancies. SAP said the cuts will help the company save up to 350 million euros annually from 2010.
The company has been affected by a lack of businesses running big enterprise software projects this year. Some experts believe SAP has not done enough to reduce the cost of running its ERP package, by offering the software as a service, which would reduce the need for IT departments to make large up-front investments in software, hardware and IT infrastructure.
CEO Henning Kagermann is due to brief city analysts this afternoon, to give more details of the company's financial woes and its strategy for 2009.