In today’s Cloud Wars Minute, I discuss how Christian Klein is transforming SAP from an enterprise applications leader into an AI-powered cloud powerhouse.
Highlights
00:01 — We got some big numbers yesterday from SAP for Q3, and one of the highlights of this, I would say, we see acceleration in its cloud revenue growth, acceleration in its current cloud backlog growth, and also in its cloud ERP suite numbers. So, a powerful quarter for SAP across Q3, and you can really see the evidence here of SAP’s ambitious AI strategy starting to kick in.
00:36 — Cloud revenue for Q3 is up 26% to $7.5 billion. Last quarter, I think it was 24% growth. Cloud backlog, 28% to $27 billion. Last quarter, it was 27% growth. Cloud ERP suite up 29% to $6.61 billion. Cloud ERP Suite is a subset of their overall cloud revenue. And the company’s total revenue, I thought this was interesting, up 13% to $11.5 billion.
01:08 — Now, certainly its traditional license business is going down. We see the rapid cloud growth pulling the whole company upward. Very, very impressive number there, 13%. Also, SAP announced that its full-year cloud guidance is going to hit what it said will be toward the upper end of the range that the company gave earlier this year.
02:19 — The Autonomous Enterprise, the big new brand promise that SAP announced at Sapphire this year. He said it’s gaining customers’ confidence. It’s trying it in parts. It’s feeling more and more comfortable with it. And Klein believes that the Autonomous Enterprise is really starting to kick in with the momentum here.
03:40 — So, as the company gets bigger, its growth rate is increasing — a very difficult thing to do. The growth rates that SAP has been putting up for the last several quarters are much higher than its primary competitors in this category. No other big enterprise — I used to call them apps company, but now we have to call them enterprise apps, agents, data, and platform company — is growing nearly as fast as SAP is.
