SAP's revenue from software and software-related services showed ample growth thanks in part to its HANA in-memory database and to strength in its portfolio of cloud applications, the company said Tuesday as it reported preliminary numbers for the quarter and year ended Dec. 31.
The company achieved a "breakthrough in the cloud" and "overachieved" on its SAP HANA revenue ambition, co-CEOs Jim Hagemann Snabe and Bill McDermott said in a statement.
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Software revenue in the fourth quarter rose 9 percent to €1.94 billion, while software and software-related service revenue stood at €4.23 billion, a 14 percent jump, as calculated under IFRS (international financial reporting standards). Revenue for the quarter grew 12 percent year over year to €5.02 billion.
However, IFRS operating profit in the quarter fell 5 percent to €1.59 billion. SAP attributed the dip to expenses related to acquisitions and share-based compensation. "Share-based compensation expenses significantly increased mainly due to the implementation of new share-based compensation plans and the strong performance of SAP's share price in 2012," it said in a statement.
For the full year, non-IFRS revenues grew 14 percent to more than €16 billion, while non-IFRS operating profits jumped 11 percent to €5.21 billion, according to SAP.
But IFRS operating profit for the full year fell 17 percent to €4.06 billion. Profits slipped "due to the companys continued investments in key innovations as well as the expansion of SAPs global go-to-market activities," it said in a statement.
The vendor parted ways with its North American sales chief following a weak first quarter in that region, and earlier this month made broader changes to its global sales territories and leadership.
HANA racked up €390 million in sales for the year, beating SAP's expectations, as did mobile software with revenue of €222 million, according to the company. SAP's annual revenue run rate from cloud offerings is now close to €850 million, SAP said.
The company made a big splash last week with the announcement that HANA can now be used with its flagship Business Suite ERP (enterprise resource planning) software. That move, which had been expected for some time, positions SAP to displace rival databases such as Oracle's from its customers' environments. The company is planning a major new marketing push focused on the Suite and HANA.
SAP had growth in all regions during the fourth quarter. In the Americas, IFRS software and software-related services sales climbed 17 percent to €1.49 billion.
Fourth-quarter software and software-related services revenue in Europe, the Middle East and Africa grew 10 percent to €2.02 billion, and jumped 18 percent to €720 million in Asia-Pacific-Japan. But software and software-related services revenues in Germany dipped 1 percent to €575 million.
SAP is expected to report its full fourth-quarter and year-end results on Jan. 23.
Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com