SAP remains cautious despite solid profits

City A.M. Reporter
GERMAN business software maker SAP AG stuck to its full-year targets in third-quarter results, dashing investor hopes that had been raised by solid results from North American peers.

SAP said third-quarter operating profit rose 16 per cent to €716m. Software and software-related service revenue (SSRS) rose 20 per cent to €2.32bn.

Operating profit was forecast at €803m on SSRS sales of €2.30bn in a Reuters poll.

SAP stuck to its 2010 growth forecast for non-IFRS key software and software-related service revenue in a 9-11 per cent range. That includes contributions of 6-8 percentage points from US database company Sybase, which SAP acquired in May.

It also reiterated its full-year target for a non-IFRS operating margin of 30-31 per cent.

Technology bellwether Oracle, which is SAP’s fiercest rival, Blackberry maker Research In Motion, and IBM have reported solid results, easing investor concerns about tech spending. “Top-line numbers are better than expected and this is obviously important,” Heino Ruland of Ruland Research said.