SAP

SAP's profitability fell sharply in 2022 despite overall revenue growth and booming cloud sales, prompting it to sell its remaining stake in Qualtrics and ...

Klein is wary of giving ChatGPT too much freedom, but sees potential for it in automating responses to common support requests or in translating documentation and user interfaces. Although the company is now focused on the cloud with the new generation of its core ERP application, S/4HANA, customers can choose where they run it. With the restructuring, SAP seems set to abandon the idea of delivering CRM as a stand-alone product, focusing instead on investing in tightly integrated industry-specific solutions in markets where it has a strong foothold with its core ERP products. “I don’t believe such technology can code a new logistics app by itself,” he said. “We will not extend [the deadline],” Klein said. €2.1 billion of that is from S/4HANA, up 91% year on year. SAP’s overall revenue for 2022 totaled €30.9 billion (US$33 billion as of Dec. Growth in Q4 was slower, however, up 6% to €8.4 billion. Inflation was another factor affecting profit, he said. For the year ahead, SAP forecast cloud revenue will continue to grow at between 22 and 25% at constant currencies, with a longer-term ambition of passing €22 billion in cloud revenue and €36 billion in total revenue by 2025. “SAP is now a true cloud company,” Klein said, adding that the company already has a backlog of €12 billion in contractually committed cloud revenue it expects to recognize in 2023, and a total cloud backlog of €34 billion including commitments for future years. “It’s not performance-based.”

SAP said on Thursday it planned to cut 3000 jobs, or 2.5% of its global workforce, and explore the sale of its remaining stake in Qualtrics, as the Germany ...

SAP forecast core operating profit of 8.8-8.9 billion euros at constant currencies for this year. "(The sale) would result in a quite significant one-time gain," Mucic said. [(GOOGL.O)](https://www.reuters.com/companies/GOOGL.O), Microsoft [(MSFT.O)](https://www.reuters.com/companies/MSFT.O) and Amazon [(AMZN.O)](https://www.reuters.com/companies/AMZN.O) announced thousands of layoffs to cut costs as they brace for tougher economic conditions. Register for free to Reuters and know the full story SAP has also started the process to sell its stake in Qualtrics [(SAPG.DE)](https://www.reuters.com/companies/SAPG.DE) said on Thursday it planned to cut 3,000 jobs, or 2.5% of its global workforce, and explore the sale of its remaining stake in Qualtrics, as the Germany software company looks to cut costs and focus on its cloud business.

The German enterprise software giant posted revenue of €8.43 billion ($9.1 billion), up 6%, a little shy of the Wall Street consensus.

[ ](https://www.barrons.com/market-data/stocks/xm) ](https://www.barrons.com/market-data/stocks/sap?countrycode=xe)

SAP became the latest tech giant to announce significant layoffs, with plans to cut up to 3000 jobs, or about 2.5% of its workforce.

We also returned to positive operating profit growth of 2%," said Klein. 2018, SAP acquired American business software provider Qualtrics for $8 billion. SAP currently holds 71% of Qualtrics on an undiluted basis. Qualtrics subsequently went public two years later. "We in the tech sector, we at SAP, we are very confident about the year ahead," Klein said at the time. "This led us to announce today that we intend to carry out a very targeted restructuring in select areas of the company that will impact up to 3,000 positions and include a headcount reduction of about 2.5%."

Software maker seeks buyer for Qualtrics customer, employee analysis unit.

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The software giant will focus on its core S/4HANA and Business Technology Platform products and plans to sell off its stake in customer experience ...

For all of 2022 SAP reported revenue of 30.87 billion euros ($33.56 billion), up 11 percent from 27.84 billion euros ($30.26 billion) in 2021. 31, 2022) the company reported revenue of 8.44 billion euros ($9.17 billion), up 6 percent from 7.98 billion euros ($8.67 billion) in the fourth quarter of 2021. But the company reported a profit of only €332 million ($360.8 million) for the quarter, down 77 percent from 1.44 billion euros ($1.57 billion) one year before. CFO Luka Mucic said on the call that cloud revenue became SAP’s the single largest revenue stream in 2022. This focus on our core, together with our ongoing optimization of SAP‘s structure for cloud success are behind the [Qualtrics] announcement we made today.” Cloud revenue increased 30 percent in the fourth quarter to 3.39 billion euros ($3.68 billion) and reached 12.56 billion euros ($13.64 billion) for all of 2022, up 33 percent from the year before. “SAP believes that this potential transaction could unlock significant value for both companies,” Klein said. Profit for the entire year was 1.71 billion euros ($1.86 billion), down 68 percent from 5.38 billion euros ($5.84 billion) one year earlier. “In 2023, we intend to sharpen this portfolio focus further,” Klein said. [SAP acquired in 2019](https://www.crn.com/news/applications-os/sap-s-8b-deal-to-acquire-qualtrics-comes-just-days-after-ipo-filing) for $8 billion and then [spun off in an IPO](https://www.crn.com/news/applications-os/qualtrics-market-cap-hits-21-66-billion-after-sap-s-spinoff-ipo) in January 2021 while retaining a majority stake in the company. The company said the savings from the cuts would be modest in 2023 and provide a savings run rate between 300 million and 350 million euros ($325 million and $380 million) in 2024. [Tech Company Layoffs In 2023: The Latest Cuts In Q1](https://www.crn.com/news/cloud/tech-company-layoffs-in-2023)]

SAP CEO Christian Klein is looking ahead to a positive impact in 2023.

We will already see a positive impact in 2023, including the promise we made to return to double-digit operating profit growth as well as accelerated cloud and total revenue growth. And last but not least, we were jointly also of the opinion that we can significantly enhance also the value for the Qualtrics and the SAP shareholders. The SAP business technology platform is the foundation behind Rise and our portfolio momentum. They will be using the SAP business technology platform for emerging technology and the SAP Analytics Cloud to enhance their strategic data management. As these results have shown, the power of SAP solutions in an increasingly uncertain world is clear. Already today, more than 80% of Wise with SAP deals include the business technology platform as the foundation for integration and extensibility. We can continue to do also in the future by embedding Qualtrics and our products go-to-market together, while we can also consider a sale which allows SAP, on the one hand side, to free up investments and efforts to double down on our growth in the core, which is super strong. I think crystallising this value of for sale might help on both ends, while at the same time giving us the ability to invest in further assets that are close to the core in general our m&a philosophy in the future, if we decide to, you know, invest parts or the whole of any proceeds that we get into an acquisitions has evolved over time. With Scope 3 emission tracking across value chains via our network, and we will give our customers the ability to act by embedding sustainability into every business process and every company decision. We are helping our customers to build more resilient supply chains by connecting the suppliers and providers from the raw material provider to the manufacturer. Because our RISE with SAP offering is much more than only a shift of our technology to the cloud. Supply chains are disrupted and need to be diversified as a result of the pandemic, geopolitic tensions and shifting business dynamics.