SAP once again scorched its enterprise-apps competitors by posting Q1 cloud growth of 27%, outgrowing its rivals by anywhere from 25% (Microsoft) to 60% (Workday) to 3X (Salesforce and Oracle).
The results were even more impressive in SAP’s core Cloud ERP Suite business as Q1 revenue jumped 34% to $4.59 billion.
And after reaching 50-50 parity in Q4 for cloud revenue and non-cloud revenue, SAP blew away any doubts that it is a full-fledged cloud powerhouse by posting Q1 cloud revenue of $5.39 billion, comprising 55.4% of the company’s total Q1 revenue of $9.73 billion.
I view SAP’s highly differentiated performance in growth rates — a trend that’s held strong for the past several quarters — versus those of its competitors as a clear indication that SAP has established itself as the clear leader in the wickedly competitive enterprise-apps space, a phenomenon I analyzed in detail in this piece a few weeks ago.
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Here’s a quick look at some key Q1 numbers as reported by SAP:
- Current cloud backlog of $19.66 billion, up 28% and up 29% at constant currencies
- Cloud revenue up 27% to $5.39 billion
- Cloud ERP Suite revenue up 34% to $4.59 billion
- Total revenue of $9.73 billion, up 12%
Troubled Waters Ahead?
CFO Dominik Asam said Q1’s solid start occurred in the midst of “a highly volatile environment.” Asam added that “While we’re encouraged by this momentum, we remain mindful of the broader environment and are approaching the rest of the year with vigilance.”
Despite the impressive Q1 results, both CEO Christian Klein and CFO Dominik Asam cited market volatility for enterprise apps, with Klein noting that “SAP’s business model remains resilient in uncertain times.”
I’ll have more insights into Klein’s perspectives on the Q1 performance next week.
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