FRANKFURT (Reuters) – SAP said on Wednesday its business activity gradually improved in the second quarter from the effects of a global lockdown, with revenues and operating profit edging up, and the German software maker confirmed its full-year outlook.
Total revenue in the period increased by 2% to 6.74 billion euros ($7.64 billion). Software licenses – SAP’s cash-cow business that generates much of its profits but is “lumpy” because revenue is recognised up front – slumped 18%, but cloud revenues were up by the same amount.
“Software licenses revenue, while still below normal levels, recovered more than expected”, SAP said in a pre-released earnings statement, adding that the revenue showed a strong sequential improvement compared to the first quarter.
Operating profit increased by 7% to 1.96 billion euros as SAP slowed hiring new staff and cut costs, including by spending less on travel and staging more virtual events.