The quarterly results from SAP reveal that the company is making strong progress in its move over to cloud computing.
The results show that the company is doing better than rival Oracle Corp. There has been a rise of 4% in new license sales in the first quarter, taking the total to $1.16bn (£750m). This is the company’s highest rise in the last two years. In comparison, license sales from Oracle fell by 9%.
SAP’s figures show that its cloud software and S/4 applications have won a growing share of the market. Oracle is projecting $37.8bn in sales for 2015, is still double the size of SAP and has a much bigger database share of the market; however, it is struggling to convince its investors about the move over to cloud computing and, as a result, its share price has dropped by 15%.
SAP, on the other hand, has seen its share price rise by more than 9% this year. By industry standards a single digit growth in licensing is low; however, with many IT departments moving over to cloud computing, this figure is understandable in the current climate.
The chief executive officer of SAP, Bill McDermott, has been updating the traditional SAP software to encourage customers to stick with the company and has been providing online capabilities for functions such as human resources and customer analysis. SAP sales and earnings have also been boosted by the weaker euro.
SAP said that cloud services and support sales have doubled during the last quarter and have surpassed its estimates.