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SAP Q3 revenue jumps 13%

SAP's Q3 numbers beat Wall Street predictions and reflect the improving European economy.

SAP today announced Q3 figures that show a 15% rise in net profits and license revenues that jumped by 13%, beating...

market predictions and increasing SAP's chances of meeting its full-year forecast.

Software sales in Europe rose 24% when compared with Q3 last year, an indication of that region's economic recovery. The Asia-Pacific region showed a 23% increase, while the U.S. gained 6% over what SAP said was a very strong Q2 -- U.S. sales jumped in Q3 by 63%.

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Total revenues for the first nine months of this year were 5.1 billion euros, an increase of 6% compared to the same period in 2003. In July, Kagermann predicted that SAP's 2004 license revenue would rise about 10%.

"If we achieve this, and we will achieve it -- and if you look at how competitors are struggling and still the market is tough -- I think it's a big achievement," Kagermann said, in an interview with Reuters Television.

Despite only a 6% increase in U.S. sales during the last three months, SAP is crediting SAP America CEO Bill McDermott, for having mined new opportunities within the small and midsized business sector and for increasing SAP's profile in the U.S.

While two of its chief U.S. competitors, Oracle Corp. and PeopleSoft Inc., were caught in a high-profile, messy controversy regarding a possible hostile takeover, SAP likes to say that it bolstered its image with customers this year as a reliable, solid choice.

Joshua Greenbaum, principal analyst at Berkeley, Calif.-based Enterprise Applications Consulting, said the Oracle/PeopleSoft battle has had a direct impact on SAP sales.

"The software market has been strong this year for SAP in the U.S., which reflects both the strength of the SAP brand and the continuing effect of the Oracle/PeopleSoft battle," Greenbaum said.

In July, SAP reported that its total Q2 earnings, jolted by new corporate contracts with companies such as PepsiCo. Inc. jumped 14%.

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