SAP FY 2018: Cloud revenue nears €5bn, 10,500 customers for S/4 Hana

SAP’s full-year 2018 results show cloud revenue at 20% of the total, which was €24.7bn, while the fourth quarter saw 1,000 customers added to its flagship S/4 Hana

SAP has announced €24.7bn in annual revenue for 2018, up 5% on 2017. Almost €5bn was cloud revenue, just over 20% of the total.

The supplier’s fourth quarter saw its flagship S/4 Hana enterprise resource planning (ERP) system grow from 9,500 to 10,500 customers.

SAP said in a statement: “More than 40% of the additional S/4 Hana customers were net new. It continues to be selected by world-class global companies, including Verizon Wireless, Cargill, Infosys and Nestlé. Hilti and Haribo went live with S/4 Hana this quarter.”

It added: “A growing number of companies, including Sonos, have chosen S/4 Hana in the cloud. Hitachi High Technologies went live on S/4 Hana Cloud in the fourth quarter.”

Bill McDermott, chief executive officer at SAP, flagged up the supplier’s fourth-quarter, €8bn acquisition of Qualtrics, an enterprise online survey company. In the results press statement he said: “With Qualtrics joining SAP, we are now poised to revolutionise the business software industry with experience management. With a consistent track record of unprecedented growth behind us, we are leading our stakeholders forward to bridge the experience gap.”

SAP made a big turn to the customer in 2018 with the launch of its C/4 Hana cloud-based customer experience and e-commerce platform at its annual Sapphire conference in Florida in June.

The acquisitions of lead-to-cash software-as-a-service (SaaS) supplier Callidus Software and customer identity management platform provider Gigya have also been part of the drive to have more heft in the customer experience market. SAP’s acquisition acquisition of omni-channel commerce company Hybris in 2013 was part of the origin of the supplier’s long-germinating turn to customer experience.

In the statement, the company said the C/4 platform “achieved triple-digit growth”, adding: “Segment revenue in Customer Experience was up 52% to €349m year on year. The Callidus acquisition is reflected in these segment numbers. C/4 Hana provides companies with a single, complete view of their customer across all channels and connects demand to the fulfillment engine in one end-to-end value chain. McLaren Group, National Geographic, Prada, Rubbermaid and Dyson were among those that chose it this quarter.”

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Chief financial officer Luka Mucic said: “New order entry [for all SAP products] surged 18% in Q4, taking the total for the full year to over €10bn for the first time ever. This stellar business momentum sets us up perfectly for continued strong profitable growth in 2019 and beyond, while we expect our cloud growth will continue to outperform our business software cloud peers.”

New cloud bookings, which SAP likes to describe as a critical success indicator for the future, increased by 23% to €736m in Q4 2018.

The supplier said its performance in the Europe, Middle East and Africa (Emea) region was “solid”, with cloud and software revenue increasing by 6%. “Germany, Spain and the Middle East and Africa were highlights,” it said, adding that revenue growth in the UK, Italy and Sweden was “strong”.

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