New cloud bookings surged 49 percent (44 percent at constant currencies) in the first quarter and reached €215 million. IFRS cloud subscriptions and support revenue grew 34 percent year-over-year to €905 million.
Non-IFRS cloud subscriptions and support revenue grew 34 percent year-over-year (30 percent at constant currencies) to €906 million. IFRS software revenue grew 13 percent year-over-year to €691 million. New cloud and software license order entry2grew by more than 30 percent year-over-year in the first quarter.
IFRS cloud and software revenue was €4.33 billion, an increase of 12 percent (9 percent non-IFRS at constant currencies). Total cloud subscriptions & support revenue and software support revenue was 69 percent of total revenue.
IFRS operating profit was down 17 percent to €673 million. Non-IFRS operating profit grew 8 percent to €1.20 billion (2 percent at constant currencies).
IFRS earnings per share decreased 9 percent to €0.43. Non-IFRS earnings per share increased 15 percent to €0.73. The IFRS operating profit and EPS were primarily impacted by an increase in share-based compensation expenses, which increased due to the strong development of SAP’s share price and an increase in employee participation. Nearly 65 percent of SAP employees have participated in SAP’s most recent stock program OWN SAP.
Operating cash flow was €2.87 billion, an increase of 16 percent year-over-year. Free cash flow increased 12 percent year-over-year to €2.58 billion. As a result, the company continues to deleverage its balance sheet ending the quarter with net debt of €460 million, an improvement of €2.8 billion year over year.
“SAP’s outstanding first quarter results are a decisive follow-on to our record setting 2016. Led by S/4HANA, we are seeing mass customer adoption of our solutions globally. Our inspired workforce is firmly committed to staying focused on the success of our customers and shareholders,” said Bill McDermott, CEO, SAP.
“We continued our rapid expansion in cloud, accelerating to 49 percent growth in new cloud bookings. This outstanding achievement further validates our investment decisions to drive future growth. We’re off to a good start to reach our full year targets and we are confident that we will grow our profitability in 2018 and beyond,” said Luka Mucic, CFO, SAP.
Regional revenue performance in first quarter
In the EMEA region, cloud and software revenue increased 10 percent (IFRS). Cloud subscriptions and support revenue grew 43 percent (IFRS) with an especially strong quarter in Germany, France and Italy. SAP had triple-digit software revenue growth in South Africa and the Netherlands.
The company had a strong performance in the Americas region with cloud and software revenue growing by 12 percent (IFRS). Cloud subscriptions and support revenue was up 27 percent (IFRS), driven by a strong performance in Canada and Mexico with high double-digit growth. In North America, SAP had double-digit growth in software revenue. In Latin America Brazil was a highlight with strong software revenue growth amidst a difficult macroeconomic environment.
In the APJ region SAP also had an exceptional performance in both cloud subscription and software revenue. Cloud and software revenue was up 21 percent (IFRS), with cloud subscriptions and support revenue growing by 65 percent (IFRS). Japan and India were highlights in the quarter with strong results in both cloud subscriptions and software revenue. SAP also had strong double-digit software revenue growth in Greater China and South Korea.