In this Cloud Wars Minute, I analyze the fiscal Q1 results that SAP disclosed Monday.
Highlights
00:38 — SAP rocked Q1; its overall cloud revenue growth rate was up from a very good Q4 performance. Its cloud backlog hit an all-time high for growth rate, and the 2024 whole-year outlook is strong.
01:08 — For the quarter ended March 31, cloud revenue was up 24% to $4.3 billion. It now reports revenue for a category it’s calling ERP Cloud Suite, which was up 31% to $3.48 billion. The current backlog grew 27% to $15.6 billion. Its full-year projection for cloud revenue is between $18.7 and $19 billion. The full-year growth rate will range from a low of 24% to a possible high of 27%.
01:49 — The results clearly show that demand among customers for SAP Cloud products is strong and accelerating. The new ERP Cloud Suite numbers reflect that customers are buying more frequently in a full-suite approach rather than just a specific product. This echoes what we’ve heard from Oracle and Workday.
03:47 — The numbers reflect the great work being done by CEO Christian Klein and team to execute the company’s cloud transition; the company is doing a lot of things right including the RISE and GROW programs. Hats off to SAP for a great Q1 performance.
