EX-99.1 2 tm2426630d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

Quarterly Statement Q3 2024

 

 

 

SAP Announces Q3 2024 Results

 

 

·Current cloud backlog of €15.4 billion, up 25% and up 29% at constant currencies

 

·Cloud revenue up 25% and up 27% at constant currencies

 

·Cloud ERP Suite revenue up 34% and up 36% at constant currencies

 

·Total revenue up 9% and up 10% at constant currencies

 

·IFRS cloud gross profit up 26%, non-IFRS cloud gross profit up 27% and up 28% at constant currencies

 

·IFRS operating profit up 29%, non-IFRS operating profit up 27% and up 28% at constant currencies

 

·SAP raises its 2024 outlook for cloud and software revenue, operating profit and free cash flow

 

 

 

in € millions, unless otherwise stated

 

 

1/25

 

 

Quarterly Statement Q3 2024

 

 

 

Walldorf, Germany – October 21, 2024
SAP SE (NYSE: SAP) announced today its financial results for the third quarter ended September 30, 2024.

 

 

Christian Klein, CEO: 

 

Q3 was another strong quarter for SAP, and we are confidently raising our 2024 financial outlook. Cloud revenue growth developed remarkably well in the quarter, especially for our Cloud ERP Suite. Even more importantly, we are making strong progress on Business AI with groundbreaking innovations such as SAP Knowledge Graph. A significant part of our cloud deals in Q3 included AI use cases.

 

 

Dominik Asam, CFO: 

 

We are very pleased with our third quarter performance. The 2024 transformation program has already started to yield efficiency improvements. This allowed us to deliver a strong operating profit and free cash flow, while retaining our topline momentum. We’re now focused on carrying that momentum into Q4 to safeguard the achievement of our 2025 ambition amidst a highly volatile environment.

 

Financial Performance

 

 

Group results at a glance – Third quarter 2024

 

 

  IFRS   Non-IFRS1
€ million, unless otherwise stated Q3 2024 Q3 2023 ∆ in %   Q3 2024 Q3 2023 ∆ in % ∆ in %
const. curr.
SaaS/PaaS 4,234 3,291 29   4,234 3,291 29 30
Thereof Cloud ERP Suite2 3,636 2,711 34   3,636 2,711 34 36
Thereof Extension Suite3 597 581 3   597 581 3 4
IaaS4 117 180 –35   117 180 –35 –34
Cloud revenue 4,351 3,472 25   4,351 3,472 25 27
Cloud and software revenue 7,429 6,679 11   7,429 6,679 11 12
Total revenue 8,470 7,744 9   8,470 7,744 9 10
Share of more predictable revenue (in %) 84 82 2pp   84 82 2pp  
Cloud gross profit 3,184 2,525 26   3,209 2,535 27 28
Gross profit 6,212 5,637 10   6,236 5,651 10 11
Operating profit (loss) 2,214 1,723 29   2,244 1,767 27 28
Profit (loss) after tax from continuing operations 1,441 1,272 13   1,437 1,352 6  
Profit (loss) after tax5 1,441 1,272 13   1,437 1,352 6  
Earnings per share - Basic (in €) from continuing operations 1.25 1.09 15   1.23 1.16 6  
Earnings per share - Basic (in €)5 1.25 1.09 15   1.23 1.16 6  
Net cash flows from operating activities from continuing operations 1,475 1,124 31          
Free cash flow         1,248 865 44  

 

1 For a breakdown of the individual adjustments see table “Non-IFRS Operating Expense Adjustments by Functional Areas” in this Quarterly Statement.

 

2 Cloud ERP Suite references the portfolio of strategic Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS) solutions that are tightly integrated with our core ERP solutions and are included in key commercial packages, such as RISE with SAP. The following offerings contribute to Cloud ERP Suite revenue: SAP S/4HANA Cloud, SAP Business Technology Platform, and core solutions for HR and payroll, spend management, commerce, customer data solutions, business process transformation, and working capital management. For additional information and historical data on Cloud ERP Suite, see SAP’s Reporting Framework.

 

3 Extension Suite references SAP’s remaining SaaS and PaaS solutions that supplement and extend the functional coverage of the Cloud ERP Suite.

 

4 Infrastructure as a service (IaaS): The major portion of IaaS comes from SAP HANA Enterprise Cloud.

 

5 From continuing and discontinued operations.

 

2/25

 

 

Quarterly Statement Q3 2024

 

 

 

Group results at a glance – Nine months ended September 2024

 

  IFRS   Non-IFRS1
€ million, unless otherwise stated

Q1–Q3

2024

Q1–Q3

2023

 ∆ in %  

Q1–Q3

2024

Q1–Q3

2023

 ∆ in % ∆ in % const. curr.
SaaS/PaaS 12,016 9,401 28   12,016 9,401 28 29
Thereof Cloud ERP Suite revenue2 10,217 7,695 33   10,217 7,695 33 34
Thereof Extension Suite revenue3 1,799 1,706 5   1,799 1,706 5 6
IaaS4 417 564 –26   417 564 –26 –25
Cloud revenue 12,433 9,965 25   12,433 9,965 25 26
Cloud and software revenue 21,563 19,542 10   21,563 19,542 10 11
Total revenue 24,798 22,739 9   24,798 22,739 9 10
Share of more predictable revenue (in %) 84 82 2pp   84 82 2pp  
Cloud gross profit 9,052 7,121 27   9,101 7,152 27 28
Gross profit 17,990 16,330 10   18,039 16,388 10 11
Operating profit (loss) 2,648 3,897 –32   5,717 4,546 26 27
Profit (loss) after tax from continuing operations 1,534 2,399 –36   3,660 3,019 21  
Profit (loss) after tax5 1,534 4,763 –68   3,660 4,801 –24  
Earnings per share - Basic (in €) from continuing operations 1.31 2.07 –37   3.13 2.59 21  
Earnings per share - Basic (in €)5 1.31 4.21 –69   3.13 4.39 –29  
Net cash flows from operating activities from continuing operations 5,772 4,284 35          
Free cash flow         5,031 3,423 47  

 

1 For a breakdown of the individual adjustments see table “Non-IFRS Operating Expense Adjustments by Functional Areas” in this Quarterly Statement.

 

2 Cloud ERP Suite references the portfolio of strategic Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS) solutions that are tightly integrated with our core ERP solutions and are included in key commercial packages, such as RISE with SAP. The following offerings contribute to Cloud ERP Suite revenue: SAP S/4HANA Cloud, SAP Business Technology Platform, and core solutions for HR and payroll, spend management, commerce, customer data solutions, business process transformation, and working capital management. For additional information and historical data on Cloud ERP Suite, see SAP’s Reporting Framework.

 

3 Extension Suite references SAP’s remaining SaaS and PaaS solutions that supplement and extend the functional coverage of the Cloud ERP Suite.

 

4 Infrastructure as a service (IaaS): The major portion of IaaS comes from SAP HANA Enterprise Cloud.

 

5 From continuing and discontinued operations.

 

 

 

Financial Highlights1

 

Third Quarter 2024

 

In the third quarter, SAP’s strong business momentum continued. Current cloud backlog grew by 25% to €15.38 billion and was up 29% at constant currencies. The acquisition of WalkMe contributed approximately 1 percentage point to that growth rate. Cloud revenue was up 25% to €4.35 billion and up 27% at constant currencies, fueled by Cloud ERP Suite revenue, which was up 34% to €3.64 billion and up 36% at constant currencies.

 

Software licenses revenue decreased by 15% to €0.28 billion and was down 14% at constant currencies. Cloud and software revenue was up 11% to €7.43 billion and up 12% at constant currencies. Services revenue was down 2% to €1.04 billion and down 2% at constant currencies. Total revenue was up 9% to €8.47 billion and up 10% at constant currencies.

 

The share of more predictable revenue increased by 2 percentage points to 84% in the third quarter.

 

IFRS cloud gross profit was up 26% to €3.18 billion. Non-IFRS cloud gross profit was up 27% to €3.21 billion and was up 28% at constant currencies.

 

IFRS operating profit in the third quarter was up 29% to €2.21 billion. Non-IFRS operating profit was up 27% to €2.24 billion and was up 28% at constant currencies. Operating profit growth was mainly driven by strong revenue growth as well as disciplined execution of the 2024 transformation program.

 

 

 

1 The Q3 2024 results were also impacted by other effects. For details, please refer to the disclosures on page 25 of this document.

 

3/25

 

 

Quarterly Statement Q3 2024

 

 

 

IFRS earnings per share (basic) increased 15% to €1.25. Non-IFRS earnings per share (basic) increased 6% to €1.23. IFRS effective tax rate was 33.0% (Q3/2023: 27.8%) and non-IFRS effective tax rate was 33.4% (Q3/2023: 27.1%). Both year-over-year increases mainly resulted from a temporary inability to offset withholding taxes in Germany due to tax losses in 2024 resulting from restructuring.

 

Free cash flow in the third quarter increased by 44% to €1.25 billion. While around €0.3 billion was paid out for restructuring, the positive development was primarily attributable to increased profitability and lower tax payments. For the first nine months, free cash flow was up 47% to €5.03 billion.

 

 

Share Repurchase Program

 

In May 2023, SAP announced a share repurchase program with an aggregate volume of up to €5 billion and a term until December 31, 2025. As of September 30, 2024, SAP had repurchased 16,709,250 shares at an average price of €157.09 resulting in a purchased volume of approximately €2.62 billion under the program.

 

2024 Transformation Program: Focus on scalability of operations and key strategic growth areas

 

In 2024, SAP is further increasing its focus on key strategic growth areas, in particular business AI. It is transforming its operational setup to capture organizational synergies and AI-driven efficiencies, and to prepare the company for highly scalable future revenue growth.

 

To this end, as announced in January, SAP is executing a company-wide restructuring program which is anticipated to conclude in early 2025. The restructuring is intended to ensure that SAP’s skillset and resources continue to meet future business needs and is currently expected to affect 9,000 to 10,000 positions, a majority of which will be covered by voluntary leave programs and internal re-skilling measures. Reflecting re-investments into strategic growth areas and the acquisition of WalkMe, SAP now expects to exit 2024 at a headcount slightly ahead of year-end 2023.

 

While restructuring expenses recorded in the first nine months of 2024 total €2.8 billion, the overall expenses associated with the program are estimated to be approximately €3 billion.

 

Restructuring payouts in the third quarter and first nine months of 2024 amounted to €0.3 billion and €0.8 billion respectively. Overall payouts associated with the program are currently expected at approximately €3 billion, of which a mid-triple-digit million amount is expected to occur in 2025.

 

 

Business Highlights

 

In the third quarter, customers around the globe continued to choose “RISE with SAP” to drive their end-to-end business transformations. These customers included: B3, CAF - the Development Bank of Latin America and the Caribbean, Chalhoub Group, Cochlear, Dakota Provisions, E.ON, eBay, Energy Queensland, Equinor, FairPrice Group, Gestamp Servicios, JAPAN AIRLINES, Lands’ End, Mercado Libre, Mondelez International, OLAM Global Agri, Roche, Rolls-Royce Power Systems, Schwarz Group, Siemens Healthineers, Southern Glazer's Wine & Spirits, SRAM, Tetra Pak, ZEON Corporation, and Zwilling.

 

Clorox, CPKC Railways, J.M. VOITH, KAESER KOMPRESSOREN, Nvidia, Panasonic Energy of North America, and VistaPrint went live on SAP S/4HANA Cloud in the third quarter.

 

Dawn Foods, DXC Technology, Gainsight, L’OCCITANE Group, Mistral AI, Palmer Candy, The Pool Tile Company, and SCHURTER Holding chose “GROW with SAP”, an offering helping customers adopt cloud ERP with speed, predictability, and continuous innovation.

 

Key customer wins across SAP’s solution portfolio included: AAK, Aramark, Bosideng, BY-HEALTH, Continental Automotive Technologies, Duni Group, Hamburg Commercial Bank, HR Campus, Kruger Services, Manchester City Council, Merck KGaA, PayPal, pfm medical, RWE, and VP Bank.

 

Breakthru Beverage Group, Cox Automotive Australia, and Heartland Dental went live on SAP solutions.

 

In the third quarter, SAP’s cloud revenue performance was particularly strong in APJ and EMEA and robust in the Americas region. Brazil, Chile, Germany, Italy, India, Japan and Spain had outstanding performances in cloud revenue growth while China, Saudi Arabia and the U.S. were particularly strong.

 

On July 30, SAP announced that the SAP Supervisory Board reached a mutual agreement with Executive Board Members Scott Russell and Julia White to leave the company’s Executive Board, effective August 31.

 

On September 3, SAP announced that the SAP Supervisory Board reached a mutual agreement with Chief Technology Officer and Executive Board Member Dr.-Ing. Juergen Mueller to leave the company’s Executive Board, effective September 30, 2024.

 

On September 12, SAP announced that it successfully completed its acquisition of WalkMe Ltd., a leading digital adoption platform company.

 

 

4/25

 

 

Quarterly Statement Q3 2024

 

 

 

Financial Outlook 2024

 

SAP’s financial outlook 2024 is based on SAP’s updated non-IFRS definition of profit measures which, beginning in 2024, include share-based compensation expenses and exclude gains and losses from equity securities, net. For more details, please refer to the Reporting Framework section on our Investor Relations website: https://www.sap.com/investors/en/reports/reporting-framework.html.

 

For 2024, SAP is updating its cloud and software revenue, operating profit and free cash flow outlook and now expects:

 

·€29.5 – 29.8 billion cloud and software revenue at constant currencies (2023: €26.92 billion), up 10% to 11% at constant currencies, raising the midpoint by €400 million. The previous range was €29.0 – 29.5 billion at constant currencies.

 

·€7.8 – 8.0 billion non-IFRS operating profit at constant currencies (2023: €6.51 billion), up 20% to 23% at constant currencies, raising the midpoint by €150 million. The previous range was €7.6 – 7.9 billion at constant currencies.

 

·€3.5 – 4.0 billion free cash flow (2023: €5.09 billion). The previous outlook was approximately €3.5 billion.

 

SAP continues to expect:

 

·€17.0 – 17.3 billion cloud revenue at constant currencies (2023: €13.66 billion), up 24% to 27% at constant currencies.

 

·An effective tax rate (non-IFRS) of approximately 32% (2023: 30.3%)2.

 

 

While SAP’s 2024 financial outlook is at constant currencies, actual currency reported figures are expected to be impacted by currency exchange rate fluctuations as the company progresses through the year, as reflected in the table below.

 

Currency Impact Assuming September 30, 2024 Rates Apply for 2024

 

In percentage points Q4 2024 FY 2024
Cloud revenue growth –3.0pp –1.0pp
Cloud and software revenue growth –2.0pp –1.0pp
Operating profit growth (non-IFRS) –2.0pp –2.0pp

 

 

Non-Financial Outlook 2024

 

In 2024, SAP continues to expect:

 

·The Employee Engagement Index to be in a range of 70% to 74%.

 

·A Customer Net Promoter Score of 9 to 13.

 

·To steadily decrease carbon emissions across the relevant value chain, in line with our target of achieving Net Zero carbon emissions by 2030.  

 

·To steadily increase the number of women in executive roles in line with our end of year 2027 target to achieve 25%.

 

 

 

2 The effective tax rate (non-IFRS) is a non-IFRS financial measure and is presented for supplemental informational purposes only. We do not provide an outlook for the effective tax rate (IFRS) due to the uncertainty and potential variability of gains and losses associated with equity securities, which are reconciling items between the two effective tax rates (non-IFRS and IFRS). These items cannot be provided without unreasonable efforts but could have a significant impact on our future effective tax rate (IFRS).

 

5/25

 

 

Quarterly Statement Q3 2024

 

 

 

Additional Information

 

This press release and all information therein is preliminary and unaudited. Due to rounding, numbers may not add up precisely.

 

SAP Performance Measures

For more information about our key growth metrics and performance measures, their calculation, their usefulness, and their limitations, please refer to the following document on our Investor Relations website: https://www.sap.com/investors/performance-measures

 

Webcast

SAP senior management will host a financial analyst conference call on Monday, October 21st at 11:00 PM (CEST) / 10:00 PM (BST) / 5:00 PM (EDT) / 2:00 PM (PDT). The conference will be webcast on the Company’s website at https://www.sap.com/investor and will be available for replay. Supplementary financial information pertaining to the third quarter results can be found at https://www.sap.com/investor

 

About SAP

As a global leader in enterprise applications and business AI, SAP (NYSE: SAP) stands at the nexus of business and technology. For over 50 years, organizations have trusted SAP to bring out their best by uniting business-critical operations spanning finance, procurement, HR, supply chain, and customer experience. For more information, visit www.sap.com.

 

For more information, financial community only:

Alexandra Steiger +49 (6227) 7-767336 investor@sap.com, CET

Follow SAP Investor Relations on LinkedIn at SAP Investor Relations.

 

For more information, press only:

Joellen Perry +1 (650) 445-6780 joellen.perry@sap.com, PT 
Daniel Reinhardt +49 (6227) 7-40201 daniel.reinhardt@sap.com, CET

 

For customers interested in learning more about SAP products:

Global Customer Center: +49 180 534-34-24 
United States Only: +1 (800) 872-1SAP (+1-800-872-1727)

 

Note to editors:

To preview and download broadcast-standard stock footage and press photos digitally, please visit www.sap.com/photos. On this platform, you can find high resolution material for your media channels.

 

 

 

This document contains forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations, forecasts, and assumptions that are subject to risks and uncertainties that could cause actual results and outcomes to materially differ. Additional information regarding these risks and uncertainties may be found in our filings with the Securities and Exchange Commission, including but not limited to the risk factors section of SAP’s 2023 Annual Report on Form 20-F.

 

© 2024 SAP SE. All rights reserved.

SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP SE in Germany and other countries. Please see https://www.sap.com/copyright for additional trademark information and notices

 

6/25

 

 

Quarterly Statement Q3 2024

 

 

 

Contents

 

 

(A) Consolidated Income Statements 10
       
  (A.1) Consolidated Income Statements – Quarter 10
       
  (A.2) Consolidated Income Statements – Year-to-Date 11
       
(B) Consolidated Statements of Financial Position 12
       
(C) Consolidated Statements of Cash Flows 13
       
(D) Basis of Non-IFRS Presentation 14
       
(E) Reconciliation from Non-IFRS Numbers to IFRS Numbers 14
       
  (E.1) Reconciliation of Non-IFRS Revenue – Quarter 14
       
  (E.2) Reconciliation of Non-IFRS Operating Expenses – Quarter 15
       
  (E.3) Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Quarter 15
       
  (E.4) Reconciliation of Non-IFRS Revenue – Year-to-Date 16
       
  (E.5) Reconciliation of Non-IFRS Operating Expenses – Year-to-Date 16
       
  (E.6) Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Year-to-Date 17
       
  (E.7) Reconciliation of Free Cash Flow 18
       
(F) Non-IFRS Adjustments – Actuals and Estimates 19
       
(G) Non-IFRS Operating Expense Adjustments by Functional Areas 19
       
(H) Segment Reporting 21
       
(I) Revenue by Region (IFRS and Non-IFRS) 21
       
  (I.1) Revenue by Region (IFRS and Non-IFRS) – Quarter 21
       
  (I.2) Revenue by Region (IFRS and Non-IFRS) – Year-to-Date 22
       
(J) Employees by Region and Functional Areas 23
       
(K) Share-Based Payment 24
       
(L) Restructuring 24
       
(M) Business combinations 25

 

7/25

 

 

Quarterly Statement Q3 2024

 

 

 

Financial and Non-Financial Key Facts
(IFRS and Non-IFRS)

 

 

€ millions, unless otherwise stated

Q1

2023

Q2

2023

Q3

2023

Q4

2023

TY

2023

Q1

2024

Q2

2024

Q3

2024

Revenues                
Cloud 3,178 3,316 3,472 3,699 13,664 3,928 4,153 4,351
% change – yoy 24 19 16 20 20 24 25 25
% change constant currency – yoy 22 22 23 25 23 25 25 27
Cloud ERP Suite 2,422 2,562 2,711 2,931 10,626 3,167 3,414 3,636
% change – yoy 35 30 26 28 29 31 33 34
% change constant currency – yoy 33 33 34 33 33 32 33 36
Software licenses 276 316 335 838 1,764 203 229 285
% change – yoy –13 –26 –17 –8 –14 –26 –28 –15
% change constant currency – yoy –13 –24 –14 –6 –12 –25 –27 –14
Software support 2,905 2,873 2,872 2,846 11,496 2,829 2,792 2,793
% change – yoy –1 –3 –5 –5 –3 –3 –3 –3
% change constant currency – yoy –1 –1 –1 –1 –1 –1 –3 –2
Software licenses and support 3,180 3,189 3,208 3,683 13,261 3,031 3,021 3,078
% change – yoy –2 –6 –6 –6 –5 –5 –5 –4
% change constant currency – yoy –2 –4 –2 –2 –3 –4 –5 –3
Cloud and software 6,358 6,505 6,679 7,382 26,924 6,960 7,175 7,429
% change – yoy 10 5 4 6 6 9 10 11
% change constant currency – yoy 8 8 9 10 9 11 10 12
Total revenue 7,441 7,554 7,744 8,468 31,207 8,041 8,288 8,470
% change – yoy 10 5 4 5 6 8 10 9
% change constant currency – yoy 9 8 9 9 9 9 10 10
Share of more predictable revenue (in %) 82 82 82 77 81 84 84 84
Profits                
Operating profit (loss) (IFRS) 803 1,371 1,723 1,902 5,799 –787 1,222 2,214
Operating profit (loss) (non-IFRS) 1,321 1,457 1,767 1,969 6,514 1,533 1,940 2,244
% change - yoy –15 14 7 1 1 16 33 27
% change constant currency - yoy –15 19 13 5 5 19 35 28
Profit (loss) after tax (IFRS) 403 724 1,272 1,201 3,600 –824 918 1,441
Profit (loss) after tax (non-IFRS) 868 799 1,352 1,302 4,321 944 1,278 1,437
% change - yoy –20 –9 13 –10 –6 9 60 6
Margins                
Cloud gross margin (IFRS, in %) 70.5 71.1 72.7 71.9 71.6 72.2 73.0 73.2
Cloud gross margin (non-IFRS, in %) 70.8 71.4 73.0 72.2 71.9 72.5 73.3 73.7
Software license and support gross margin (IFRS, in %) 88.6 89.8 90.0 89.8 89.6 89.2 89.7 90.1
Software license and support gross margin (non-IFRS, in %) 88.9 90.2 90.1 89.8 89.8 89.2 89.7 90.1
Cloud and software gross margin (IFRS, in %) 79.5 80.3 81.0 80.8 80.4 79.6 80.0 80.2
Cloud and software gross margin (non-IFRS, in %) 79.9 80.6 81.2 81.0 80.7 79.8 80.2 80.5
Gross margin (IFRS, in %) 71.0 71.6 72.8 73.3 72.2 71.7 72.6 73.3
Gross margin (non-IFRS, in %) 71.3 71.9 73.0 73.4 72.4 71.8 72.7 73.6
Operating margin (IFRS, in %) 10.8 18.2 22.2 22.5 18.6 –9.8 14.7 26.1

 

8/25

 

 

Quarterly Statement Q3 2024

 

 

 

€ millions, unless otherwise stated

Q1

2023

Q2

2023

Q3

2023

Q4

2023

TY

2023

Q1

2024

Q2

2024

Q3

2024

Operating margin (non-IFRS, in %) 17.8 19.3 22.8 23.3 20.9 19.1 23.4 26.5
Key Profit Ratios                
Effective tax rate (IFRS, in %) 40.5 33.8 27.8 33.6 32.6 16.0 33.8 33.0
Effective tax rate (non-IFRS, in %) 29.1 33.0 27.1 32.5 30.3 32.4 33.6 33.4
                 
Earnings per share, basic (IFRS, in €) from continuing operations 0.35 0.62 1.09 1.05 3.11 –0.71 0.76 1.25
Earnings per share, basic (non-IFRS, in €) from continuing operations 0.75 0.69 1.16 1.12 3.72 0.81 1.10 1.23
Earnings per share, basic (IFRS, in €)1 0.41 2.70 1.09 1.05 5.26 –0.71 0.76 1.25
Earnings per share, basic (non-IFRS, in €)1 0.83 2.40 1.16 1.12 5.51 0.81 1.10 1.23
Order Entry and current cloud backlog                
Current cloud backlog 11,148 11,537 12,269 13,745 13,745 14,179 14,808 15,377
% change – yoy 25 21 19 25 25 27 28 25
% change constant currency – yoy 25 25 25 27 27 28 28 29
Share of cloud orders greater than €5 million based on total cloud order entry volume (in %) 45 46 49 62 55 52 52 64
Share of cloud orders smaller than €1 million based on total cloud order entry volume (in %) 26 25 21 14 19 21 20 16
Liquidity and Cash Flow                
Net cash flows from operating activities 2,311 848 1,124 1,926 6,210 2,757 1,540 1,475
Purchase of intangible assets and property, plant, and equipment –257 –156 –182 –190 –785 –187 –178 –163
Payments of lease liabilities –99 –89 –78 –66 –332 –78 –70 –65
Free cash flow 1,955 604 865 1,670 5,093 2,492 1,291 1,248
% of total revenue 26 8 11 20 16 31 16 15
% of profit after tax (IFRS) 485 83 68 139 141 NA 141 87
Cash and cash equivalents 8,766 14,142 9,378 8,124 8,124 9,295 7,870 10,005
Group liquidity 9,700 14,326 12,122 11,275 11,275 13,411 11,449 11,856
Financial debt (–) –10,751 –10,146 –8,445 –7,755 –7,755 –7,770 –7,776 –8,996
Net liquidity (+) / Net debt(–) –1,050 4,180 3,677 3,521 3,521 5,641 3,674 2,860
Non-Financials                
Number of employees (quarter end)2 105,132 105,328 106,495 107,602 107,602 108,133 105,315 107,583
Employee retention (in %, rolling 12 months) 93.8 95.1 96.0 96.4 96.4 96.6 96.6 96.7
Women in management (in %, quarter end) 29.4 29.5 29.5 29.7 29.7 29.8 29.9 30.0
Women in executive roles (in %, quarter end) 21.8 21.9 22.1 22.2 22.2 21.7 21.9 22.0

Gross greenhouse gas emissions
(scope 1, 2, 3 / market-based)3

(in million tons CO2 equivalents)

         6.9 1.8 1.8 1.8

 

1 From continuing and discontinued operations.

 

2 In full-time equivalents.

 

3 Our gross greenhouse gas emissions (GHG) – which cover scope 1, scope 2, and scope 3 (market based) – include the total lifecycle emissions resulting from the use of our on-premise software. The calculation of use of sold products emissions is based on the number of active maintenance contracts at quarter end. Therefore, the emissions for individual quarters will not add up to the total sum of GHG emissions at year end.

 

9/25

 

 

Quarterly Statement Q3 2024

 

 

 

Primary Financial Statements of SAP Group (IFRS)

 

 

(A)           Consolidated Income Statements

 

(A.1)         Consolidated Income Statements – Quarter

 

€ millions, unless otherwise stated   Q3 2024 Q3 2023 ∆ in %
Cloud   4,351 3,472 25
Software licenses   285 335 –15
Software support   2,793 2,872 –3
Software licenses and support   3,078 3,208 –4
Cloud and software   7,429 6,679 11
Services   1,041 1,065 –2
Total revenue   8,470 7,744 9
         
Cost of cloud   –1,167 –946 23
Cost of software licenses and support   –306 –321 –5
Cost of cloud and software   –1,472 –1,268 16
Cost of services   –786 –840 –6
Total cost of revenue   –2,258 –2,108 7
Gross profit   6,212 5,637 10
Research and development   –1,568 –1,515 4
Sales and marketing   –2,098 –2,105 0
General and administration   –361 –327 10
Restructuring   52 36 43
Other operating income/expense, net   –22 –3 >100
Total operating expenses   –6,256 –6,022 4
Operating profit (loss)   2,214 1,723 29
         
Other non-operating income/expense, net   –62 113 N/A
Finance income   240 204 18
Finance costs   –241 –279 –14
Financial income, net   –1 –75 –99
Profit (loss) before tax from continuing operations   2,151 1,761 22
         
Income tax expense   –710 –489 45
Profit (loss) after tax from continuing operations   1,441 1,272 13
Attributable to owners of parent   1,463 1,278 15
Attributable to non-controlling interests   –23 –6 >100
Profit (loss) after tax from discontinued operations   0 0 NA
Profit (loss) after tax1   1,441 1,272 13
Attributable to owners of parent1   1,463 1,278 15
Attributable to non-controlling interests1   –23 –6 >100
         
Earnings per share, basic (in €)2 from continuing operations   1.25 1.09 15
Earnings per share, basic (in €)1, 2   1.25 1.09 15
Earnings per share, diluted (in €)2 from continuing operations   1.24 1.08 15
Earnings per share, diluted (in €)1, 2   1.24 1.08 15

 

1 From continuing and discontinued operations

 

2 For the three months ended September 30, 2024 and 2023, the weighted average number of shares was 1,166 million (diluted 1,178 million) and 1,168 million (diluted: 1,180 million), respectively (treasury stock excluded).

 

10/25

 

 

Quarterly Statement Q3 2024

 

 

 

(A.2)       Consolidated Income Statements – Year-to-Date

 

€ millions, unless otherwise stated   Q1–Q3 2024 Q1–Q3 2023 ∆ in %
Cloud   12,433 9,965 25
Software licenses   716 927 –23
Software support   8,414 8,651 –3
Software licenses and support   9,130 9,577 –5
Cloud and software   21,563 19,542 10
Services   3,236 3,197 1
Total revenue   24,798 22,739 9
         
Cost of cloud   –3,381 –2,843 19
Cost of software licenses and support   –943 –1,008 –6
Cost of cloud and software   –4,324 –3,852 12
Cost of services   –2,485 –2,557 –3
Total cost of revenue   –6,808 –6,409 6
Gross profit   17,990 16,330 10
Research and development   –4,839 –4,653 4
Sales and marketing   –6,594 –6,562 0
General and administration   –1,057 –997 6
Restructuring   –2,821 –221 >100
Other operating income/expense, net   –31 0 NA
Total operating expenses   –22,150 –18,842 18
Operating profit (loss)   2,648 3,897 –32
         
Other non-operating income/expense, net   –215 –3 >100
Finance income   850 573 48
Finance costs   –726 –935 –22
Financial income, net   124 –363 NA
Profit (loss) before tax from continuing operations   2,557 3,532 –28
         
Income tax expense   –1,023 –1,132 –10
Profit (loss) after tax from continuing operations   1,534 2,399 –36
Attributable to owners of parent   1,523 2,413 –37
Attributable to non-controlling interests   11 –13 NA
Profit (loss) after tax from discontinued operations   0 2,363 NA
Profit (loss) after tax1   1,534 4,763 –68
Attributable to owners of parent1   1,523 4,917 –69
Attributable to non-controlling interests1   11 –155 NA
         
Earnings per share, basic (in €)2 from continuing operations   1.31 2.07 –37
Earnings per share, basic (in €)1, 2   1.31 4.21 –69
Earnings per share, diluted (in €)2 from continuing operations   1.29 2.05 –37
Earnings per share, diluted (in €)1, 2   1.29 4.17 –69

 

1 From continuing and discontinued operations

 

2 For the nine months ended September 30, 2024 and 2023, the weighted average number of shares was 1,167 million (diluted: 1,179 million) and 1,168 million (diluted: 1,179 million), respectively (treasury stock excluded).

 

11/25

 

 

Quarterly Statement Q3 2024

 

 

 

(B)          Consolidated Statements of Financial Position

 

as at 09/30/2024 and 12/31/2023
€ millions 2024 2023
Cash and cash equivalents 10,005 8,124
Other financial assets 2,067 3,344
Trade and other receivables 5,481 6,322
Other non-financial assets 2,436 2,374
Tax assets 517 407
Total current assets 20,506 20,571
Goodwill 29,487 29,088
Intangible assets 2,708 2,505
Property, plant, and equipment 4,239 4,276
Other financial assets 6,145 5,543
Trade and other receivables 142 203
Other non-financial assets 3,450 3,573
Tax assets 333 382
Deferred tax assets 2,639 2,193
Total non-current assets 49,142 47,763
Total assets 69,648 68,335
 
€ millions 2024 2023
Trade and other payables 1,932 1,783
Tax liabilities 502 266
Financial liabilities 3,864 1,735
Other non-financial liabilities 4,220 5,648
Provisions 2,149 235
Contract liabilities 5,989 4,975
Total current liabilities 18,655 14,642
Trade and other payables 15 39
Tax liabilities 846 877
Financial liabilities 7,039 7,941
Other non-financial liabilities 800 698
Provisions 442 433
Deferred tax liabilities 318 265
Contract liabilities 67 33
Total non-current liabilities 9,526 10,286
Total liabilities 28,181 24,928
Issued capital 1,229 1,229
Share premium 2,420 1,845
Retained earnings 41,424 42,457
Other components of equity 1,931 2,368
Treasury shares –5,793 –4,741
Equity attributable to owners of parent 41,212 43,157
     
Non-controlling interests 255 249
Total equity 41,467 43,406
Total equity and liabilities 69,648 68,335

 

12/25

 

 

Quarterly Statement Q3 2024

 

 

 

(C)          Consolidated Statements of Cash Flows

 

€ millions Q1–Q3 2024 Q1–Q3 2023
Profit (loss) after tax 1,534 4,671
Adjustments to reconcile profit (loss) after tax to net cash flows from operating activities:    
(Profit) loss after tax from discontinued operations 0 –2,272
Depreciation and amortization 943 1,042
Share-based payment expense 1,815 1,677
Income tax expense 1,023 1,132
Financial income, net –124 363
Decrease/increase in allowances on trade receivables –8 12
Other adjustments for non-cash items 212 –35
Increase/decrease in trade and other receivables 943 678
Decrease/increase in other assets 56 –555
Increase/decrease in trade payables, provisions, and other liabilities 746 –470
Increase/decrease in contract liabilities 1,054 552
Share-based payments –1,064 –967
Interest paid –439 –305
Interest received 420 331
Income taxes paid, net of refunds –1,341 –1,570
Net cash flows from operating activities – continuing operations 5,772 4,284
Net cash flows from operating activities – discontinued operations 0 80
Net cash flows from operating activities 5,772 4,364
Business combinations, net of cash and cash equivalents acquired –1,104 0
Cash flows from derivative financial instruments related to the sale of subsidiaries or businesses 0 –91
Purchase of intangible assets and property, plant, and equipment –528 –595
Proceeds from sales of intangible assets and property, plant, and equipment 80 72
Purchase of equity or debt instruments of other entities –6,517 –2,969
Proceeds from sales of equity or debt instruments of other entities 7,452 865
Net cash flows from investing activities – continuing operations –618 –2,718
Net cash flows from investing activities – discontinued operations 0 5,625
Net cash flows from investing activities –618 2,907
Dividends paid –2,565 –2,395
Dividends paid on non-controlling interests 0 –18
Purchase of treasury shares –1,625 –718
Proceeds from borrowings 1,251 0
Repayments of borrowings –14 –3,442
Payments of lease liabilities –213 –266
Transactions with non-controlling interests –13 42
Net cash flows from financing activities – continuing operations –3,180 –6,797
Net cash flows from financing activities – discontinued operations 0 24
Net cash flows from financing activities –3,180 –6,773
Effect of foreign currency rates on cash and cash equivalents –94 –128
Net decrease/increase in cash and cash equivalents 1,881 370
Cash and cash equivalents at the beginning of the period 8,124 9,008
Cash and cash equivalents at the end of the period 10,005 9,378

 

13/25

 

 

Quarterly Statement Q3 2024

 

 

 

Non-IFRS Numbers

 

(D)          Basis of Non-IFRS Presentation

 

SAP discloses certain financial measures such as expense (non-IFRS) and profit measures (non-IFRS) that are not prepared in accordance with IFRS and are therefore considered non-IFRS financial measures.

 

For a more detailed description of all of SAP’s non-IFRS measures and their limitations as well as SAP’s constant currency and free cash flow figures, see Explanation of Non-IFRS Measures.

 

 

 

(E)          Reconciliation from Non-IFRS Numbers to IFRS Numbers

 

 

(E.1)      Reconciliation of Non-IFRS Revenue – Quarter

 

 

€ millions, unless otherwise stated Q3 2024 Q3 2023  ∆ in %
IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS IFRS

Non-IFRS

Constant

Currency

Revenue Numbers            
Cloud 4,351 43 4,394 3,472 25 27
Software licenses 285 2 287 335 –15 –14
Software support 2,793 24 2,817 2,872 –3 –2
Software licenses and support 3,078 26 3,104 3,208 –4 –3
Cloud and software 7,429 69 7,497 6,679 11 12
Services 1,041 7 1,048 1,065 –2 –2
Total revenue 8,470 76 8,546 7,744 9 10

 

14/25

 

 

Quarterly Statement Q3 2024

 

 

 

(E.2)       Reconciliation of Non-IFRS Operating Expenses – Quarter

 

 

€ millions, unless otherwise stated Q3 2024 Q3 2023  ∆ in %
IFRS Adj. Non-IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS Adj. Non-IFRS IFRS Non-IFRS

Non-IFRS

Constant

Currency

Operating Expense Numbers                      
Cost of cloud –1,167 25 –1,142     –946 10 –937 23 22  
Cost of software licenses and support –306 0 –306     –321 4 –318 –5 –4  
Cost of cloud and software –1,472 25 –1,448     –1,268 14 –1,254 16 15  
Cost of services –786 0 –785     –840 0 –840 –6 –6  
Total cost of revenue –2,258 25 –2,233     –2,108 14 –2,094 7 7  
Gross profit 6,212 25 6,236 50 6,286 5,637 14 5,651 10 10 11
Research and development –1,568 0 –1,568     –1,515 2 –1,513 4 4  
Sales and marketing –2,098 51 –2,047     –2,105 64 –2,041 0 0  
General and administration –361 6 –356     –327 0 –327 10 9  
Restructuring 52 –52 0     36 –36 0 43 NA  
Other operating income/expense, net –22 0 –22     –3 0 –3 >100 >100  
Total operating expenses –6,256 30 –6,226 –67 –6,293 –6,022 44 –5,978 4 4 5

 

 

(E.3)       Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Quarter

 

 

€ millions, unless otherwise stated Q3 2024 Q3 2023  ∆ in %
IFRS Adj. Non-IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS Adj. Non-IFRS IFRS Non-IFRS

Non-IFRS

Constant

Currency

Profit Numbers                      
Operating profit (loss) 2,214 30 2,244 9 2,253 1,723 44 1,767 29 27 28
Other non-operating income/expense, net –62 0 –62     113 0 113 NA NA  
Finance income 240 –87 153     204 –53 151 18 1  
Finance costs –241 63 –178     –279 103 –177 –14 1  
Financial income, net –1 –24 –24     –75 50 –25 –99 –3  
Profit (loss) before tax from continuing operations 2,151 6 2,157     1,761 94 1,855 22 16  
Income tax expense –710 –10 –720     –489 –13 –502 45 43  
Profit (loss) after tax from continuing operations 1,441 –3 1,437     1,272 81 1,352 13 6  
Attributable to owners of parent 1,463 –29 1,434     1,278 72 1,350 15 6  
Attributable to non-controlling interests –23 26 3     –6 9 3 >100 18  
Profit (loss) after tax1 1,441 –3 1,437     1,272 81 1,352 13 6  
Attributable to owners of parent1 1,463 –29 1,434     1,278 72 1,350 15 6  
Attributable to non-controlling interests1 –23 26 3     –6 9 3 >100 18  
                       
Key Ratios                      
Operating margin (in %) 26.1   26.5   26.4 22.2   22.8 3.9pp 3.7pp 3.5pp
Effective tax rate (in %)2 33.0   33.4     27.8   27.1 5.3pp 6.3pp  
Earnings per share, basic (in €) from continuing operations 1.25   1.23     1.09   1.16 15 6  
Earnings per share, basic (in €)1 1.25   1.23     1.09   1.16 15 6  

1 From continuing and discontinued operations
2 The difference between our effective tax rate (IFRS) and effective tax rate (non-IFRS) in Q3 2024 and Q3 2023 mainly resulted from tax effects of acquisition-related charges and restructuring expenses.

 

15/25

 

 

Quarterly Statement Q3 2024

 

 

 

(E.4)       Reconciliation of Non-IFRS Revenue – Year-to-Date

 

 

€ millions, unless otherwise stated Q1–Q3 2024 Q1–Q3 2023  ∆ in %
IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS IFRS

Non-IFRS

Constant

Currency

Revenue Numbers            
Cloud 12,433 92 12,524 9,965 25 26
Software licenses 716 7 723 927 –23 –22
Software support 8,414 64 8,478 8,651 –3 –2
Software licenses and support 9,130 71 9,201 9,577 –5 –4
Cloud and software 21,563 162 21,725 19,542 10 11
Services 3,236 15 3,251 3,197 1 2
Total revenue 24,798 178 24,976 22,739 9 10

 

 

(E.5)      Reconciliation of Non-IFRS Operating Expenses – Year-to-Date

 

 

€ millions, unless otherwise stated Q1–Q3 2024 Q1–Q3 2023  ∆ in %
IFRS Adj. Non-IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS Adj. Non-IFRS IFRS Non-IFRS

Non-IFRS

Constant

Currency

Operating Expense Numbers                      
Cost of cloud –3,381 49 –3,332     –2,843 31 –2,812 19 18  
Cost of software licenses and support –943 0 –943     –1,008 26 –982 –6 –4  
Cost of cloud and software –4,324 49 –4,275     –3,852 57 –3,795 12 13  
Cost of services –2,485 0 –2,484     –2,557 1 –2,557 –3 –3  
Total cost of revenue –6,808 50 –6,759     –6,409 58 –6,351 6 6  
Gross profit 17,990 50 18,039 147 18,187 16,330 58 16,388 10 10 11
Research and development –4,839 3 –4,835     –4,653 6 –4,647 4 4  
Sales and marketing –6,594 180 –6,413     –6,562 363 –6,199 0 3  
General and administration –1,057 14 –1,043     –997 1 –996 6 5  
Restructuring –2,821 2,821 0     –221 221 0 >100 NA  
Other operating income/expense, net –31 0 –31     0 0 0 NA NA  
Total operating expenses –22,150 3,069 –19,081 –102 –19,183 –18,842 649 –18,193 18 5 5

 

16/25

 

 

Quarterly Statement Q3 2024

 

 

 

(E.6)          Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Year-to-Date

 

 

€ millions, unless otherwise stated Q1–Q3 2024 Q1–Q3 2023  ∆ in %
IFRS Adj.

Non-IFRS

Currency

Impact

Non-IFRS

Constant

Currency

 IFRS Adj. Non-IFRS IFRS Non-IFRS

Non-IFRS

Constant

Currency

Profit Numbers                      
Operating profit (loss) 2,648 3,069 5,717 76 5,793 3,897 649 4,546 –32 26 27
Other non-operating income/expense, net –215 0 –215     –3 0 –3 >100 >100  
Finance income 850 –369 482     573 –238 335 48 44  
Finance costs –726 222 –504     –935 329 –607 –22 –17  
Financial income, net 124 –147 –23     –363 91 –272 NA –92  
Profit (loss) before tax from continuing operations 2,557 2,922 5,479     3,532 739 4,271 –28 28  
Income tax expense –1,023 –796 –1,819     –1,132 –120 –1,252 –10 45  
Profit (loss) after tax from continuing operations 1,534 2,126 3,660     2,399 620 3,019 –36 21  
Attributable to owners of parent 1,523 2,134 3,657     2,413 615 3,028 –37 21  
Attributable to non-controlling interests 11 –8 3     –13 5 –9 NA NA  
Profit (loss) after tax1 1,534 2,126 3,660     4,763 38 4,801 –68 –24  
Attributable to owners of parent1 1,523 2,134 3,657     4,917 208 5,125 –69 –29  
Attributable to non-controlling interests1 11 –8 3     –155 –170 –325 NA NA  
                       
Key Ratios                      
Operating margin (in %) 10.7   23.1   23.2 17.1   20.0 –6.5pp 3.1pp 3.2pp
Effective tax rate (in %)2 40.0   33.2     32.1   29.3 7.9pp 3.9pp  
Earnings per share, basic (in €) from continuing operations 1.31   3.13     2.07   2.59 –37 21  
Earnings per share, basic (in €)1 1.31   3.13     4.21   4.39 –69 –29  

 

1 From continuing and discontinued operations

 

2 The difference between our effective tax rate (IFRS) and effective tax rate (non-IFRS) in the first nine months of 2024 and 2023 mainly resulted from tax effects of restructuring expenses and acquisition-related charges.

 

17/25

 

 

Quarterly Statement Q3 2024

 

 

 

(E.7)          Reconciliation of Free Cash Flow

 

 

€ millions, unless otherwise stated Q1–Q3 2024 Q1–Q3 2023
Net cash flows from operating activities – continuing operations 5,772 4,284
Purchase of intangible assets and property, plant, and equipment –528 –595
Payments of lease liabilities –213 –266
Free cash flow 5,031 3,423
     
Net cash flows from investing activities – continuing operations –618 –2,718
Net cash flows from financing activities – continuing operations –3,180 –6,797

 

18/25

 

 

Quarterly Statement Q3 2024

 

 

 

(F)          Non-IFRS Adjustments – Actuals and Estimates

 

€ millions, unless otherwise stated

Estimated Amounts for

Full Year 2024

 Q3 2024 Q1–Q3 2024 Q3 2023 Q1–Q3 2023
Profit (loss) before tax from continuing operations (IFRS)   2,151 2,557 1,761 3,532
Adjustment for acquisition-related charges  320–400 90 256 80 257
Adjustment for restructuring approximately €3 bn –52 2,821 –36 221
Adjustment for regulatory compliance matter expenses -8 –8 –8 0 170
Adjustment for gains and losses from equity securities, net N/A1 –24 –147 50 91
Profit (loss) before tax from continuing operations (non-IFRS)   2,157 5,479 1,855 4,271

 

1 Due to the uncertainty and potential variability of gains and losses from equity securities, we cannot provide an estimate for the full year without unreasonable efforts. This item could however have a material impact on our non-IFRS measures below operating profit.

 

 

(G)          Non-IFRS Operating Expense Adjustments by Functional Areas

 

€ millions Q3 2024 Q3 2023
  IFRS Acquisition-
Related		 Restructuring RCM1 Non-IFRS IFRS Acquisition-Related Restructuring RCM1 Non-IFRS
Cost of cloud –1,167 25 0 0 –1,142 –946 10 0 0 –937
Cost of software licenses and support –306 0 0 0 –306 –321 4 0 0 –318
Cost of services –786 0 0 0 –785 –840 0 0 0 –840
Research and development –1,568 0 0 0 –1,568 –1,515 2 0 0 –1,513
Sales and marketing –2,098 59 0 –8 –2,047 –2,105 64 0 0 –2,041
General and administration –361 6 0 0 –356 –327 0 0 0 –327
Restructuring 52 0 –52 0 0 36 0 –36 0 0
Other operating income/expense, net –22 0 0 0 –22 –3 0 0 0 –3
Total operating expenses –6,256 90 –52 –8 –6,226 –6,022 80 –36 0 –5,978

 

1 Regulatory Compliance Matters

 

€ millions Q1–Q3 2024 Q1–Q3 2023
IFRS Acquisition-
Related		 Restructuring RCM1 Non-IFRS IFRS Acquisition-Related Restructuring RCM1 Non-IFRS
Cost of cloud –3,381 49 0 0 –3,332 –2,843 31 0 0 –2,812
Cost of software licenses and support –943 0 0 0 –943 –1,008 26 0 0 –982
Cost of services –2,485 0 0 0 –2,484 –2,557 1 0 0 –2,557
Research and development –4,839 3 0 0 –4,835 –4,653 6 0 0 –4,647
Sales and marketing –6,594 189 0 –8 –6,413 –6,562 193 0 170 –6,199
General and administration –1,057 14 0 0 –1,043 –997 1 0 0 –996
Restructuring –2,821 0 2,821 0 0 –221 0 221 0 0
Other operating income/expense, net –31 0 0 0 –31 0 0 0 0 0
Total operating expenses –22,150 256 2,821 –8 –19,081 –18,842 257 221 170 –18,193

 

1 Regulatory Compliance Matters

 

19/25

 

 

Quarterly Statement Q3 2024

 

 

 

If not presented in a separate line item in our income statement, the restructuring expenses would break down as follows:

 

€ millions Q3 2024 Q1–Q3 2024 Q3 2023 Q1–Q3 2023
Cost of cloud 1 –94 9 2
Cost of software licenses and support 0 –80 2 –9
Cost of services 8 –525 8 –26
Research and development 12 –1,088 –4 –44
Sales and marketing 12 –894 22 –128
General and administration 18 –141 –1 –16
Restructuring expenses 52 –2,821 36 –221

 

20/25

 

 

Quarterly Statement Q3 2024

 

 

 

Disaggregations

 

 

(H)          Segment Reporting

 

SAP operates on a consolidated basis as one operating segment. For further details, see Note (C.1) “Results of Segments” of our Consolidated Half-Year Financial Statements 2024.

 

For more information about SAP’s operating performance, see the Reconciliation from Non-IFRS Numbers to IFRS Numbers section.

 

 

(I)             Revenue by Region (IFRS and Non-IFRS)

 

(I.1)          Revenue by Region (IFRS and Non-IFRS) – Quarter

 

€ millions Q3 2024 Q3 2023  ∆ in %
Actual currency

Currency

Impact

Constant

Currency

 Actual currency Actual currency

Constant

Currency

Cloud Revenue by Region      
EMEA 1,742 –2 1,740 1,352 29 29
Americas 1,989 35 2,024 1,678 19 21
APJ 620 10 630 442 40 43
Cloud revenue 4,351 43 4,394 3,472 25 27
Cloud and Software Revenue by Region      
EMEA 3,370 –4 3,366 3,010 12 12
Americas 2,982 55 3,037 2,696 11 13
APJ 1,077 18 1,094 973 11 12
Cloud and software revenue 7,429 69 7,497 6,679 11 12
Total Revenue by Region      
Germany 1,282 0 1,283 1,212 6 6
Rest of EMEA 2,574 –4 2,569 2,280 13 13
Total EMEA 3,856 –4 3,852 3,492 10 10
United States 2,739 27 2,766 2,506 9 10
Rest of Americas 679 34 713 651 4 9
Total Americas 3,418 61 3,479 3,157 8 10
Japan 357 13 370 297 20 25
Rest of APJ 839 7 845 798 5 6
Total APJ 1,195 20 1,215 1,095 9 11
Total revenue   8,470 76 8,546 7,744 9 10

 

21/25

 

 

Quarterly Statement Q3 2024

 

 

 

(I.2)       Revenue by Region (IFRS and Non-IFRS) – Year-to-Date

 

€ millions Q1–Q3 2024 Q1–Q3 2023  ∆ in %
Actual Currency

Currency

Impact

Constant

Currency

 Actual Currency Actual
Currency

Constant

Currency

Cloud Revenue by Region      
EMEA 4,972 –13 4,959 3,810 31 30
Americas 5,751 39 5,790 4,873 18 19
APJ 1,710 66 1,776 1,282 33 38
Cloud revenue 12,433 92 12,524 9,965 25 26
Cloud and Software Revenue by Region      
EMEA 9,695 –22 9,673 8,670 12 12
Americas 8,757 60 8,817 7,979 10 11
APJ 3,111 124 3,235 2,892 8 12
Cloud and software revenue 21,563 162 21,725 19,542 10 11
Total Revenue by Region      
Germany 3,802 0 3,802 3,495 9 9
Rest of EMEA 7,377 –27 7,351 6,619 11 11
Total EMEA 11,180 –27 11,153 10,113 11 10
United States 8,108 27 8,136 7,480 8 9
Rest of Americas 2,038 37 2,075 1,884 8 10
Total Americas 10,146 64 10,211 9,364 8 9
Japan 1,018 91 1,109 913 11 21
Rest of APJ 2,454 49 2,503 2,348 5 7
Total APJ 3,472 140 3,612 3,261 6 11
Total revenue   24,798 178 24,976 22,739 9 10

 

22/25

 

 

Quarterly Statement Q3 2024

 

 

 

(J)       Employees by Region and Functional Areas

 

Full-time equivalents 09/30/2024 09/30/2023
  EMEA Americas APJ Total EMEA Americas APJ Total
Cloud and software 4,510 4,256 4,592 13,357 4,150 4,193 4,181 12,523
Services 8,394 4,686 5,503 18,582 8,124 5,044 5,502 18,669
Research and development 18,422 5,623 12,729 36,774 17,952 5,907 12,698 36,557
Sales and marketing 12,078 9,742 5,149 26,969 11,796 10,166 5,311 27,272
General and administration 3,781 1,796 1,301 6,878 3,518 1,772 1,305 6,595
Infrastructure 2,964 1,156 903 5,023 2,786 1,244 849 4,878
SAP Group (09/30) 50,149 27,257 30,177 107,583 48,325 28,324 29,846 106,495
    Thereof acquisitions1 413 414 86 912 7 0 0 7
SAP Group (nine months' end average) 49,475 27,389 29,819 106,683 47,967 28,170 29,487 105,624

 

1 Acquisitions closed between January 1 and September 30 of the respective year.

 

23/25

 

 

Quarterly Statement Q3 2024

 

 

 

Other Disclosures

 

 

(K)       Share-Based Payment

 

SAP’s share-based payment expenses included in our non-IFRS operating expenses break down as follows:

 

€ millions Q3 2024 Q1–Q3 2024 Q3 2023 Q1–Q3 2023
Cost of cloud –31 –104 –23 –70
Cost of software licenses and support –9 –31 –9 –29
Cost of services –78 –269 –88 –287
Research and development –169 –572 –163 –534
Sales and marketing –199 –675 –191 –626
General and administration –49 –164 –36 –132
Share-based payment expenses –535 –1,815 –510 –1,677

 

 

Additionally, in the third quarter of 2024 SAP reduced its expenses of €17 million (Q3/2023: €0 million) relating to accelerated share-based payment expenses triggered by the transformation program. In the first nine months of 2024 expenses amounting to €172 million (Q1-Q3/2023: €0 million) have been recognized. These share-based payment expenses are classified as restructuring expenses in SAP’s consolidated income statements.

 

Associated share-based payments in the first nine months of 2024 amounted to €143 million (Q1-Q3/2023: €0 million) and are classified as a decrease in provisions and other liabilities in SAP’s consolidated statements of cash flows.

 

 

 

(L)       Restructuring

 

The vast majority of the restructuring expenses and related payments recognized in the first nine months of 2024 relate to the company-wide transformation program that SAP announced in the first quarter to further increase its focus on key strategic growth areas, in particular business AI. SAP is transforming its operational setup to capture organizational synergies and AI driven efficiencies, and to prepare the company for highly scalable future revenue growth. The restructuring is intended to ensure that SAP’s skillset and resources continue to meet future business needs. Restructuring expenses primarily include employee-related benefits such as severance payments and accelerated share-based payment expenses triggered by the transformation program (for more information on recognition and measurement of share-based payment programs, see Notes to the Consolidated Half-Year Financial Statements 2024, Note B.3).

 

For the movement of the restructuring provision in the first nine months of 2024, please refer to the table below:

 

€ millions Restructuring Provision
Opening balance as at 1/1/2024 37
Additions 2,821
Utilizations –673
Transfer to share-based compensation liability –110
Ending balance as at 9/30/2024 2,075

 

 

For a reconciliation of the utilization of the restructuring provision to the cash outflow related to restructuring, please refer to the table below:

 

€ millions Q1–Q3 2024
Utilizations 673
Payout of share-based compensation   143
Time account payout 13
Net cash outflow 829

 

24/25

 

 

Quarterly Statement Q3 2024

 

 

 

(M)       Business combinations

 

On June 5, 2024, SAP announced its intention to acquire 100% of WalkMe Ltd. (“WalkMe”), a leader in Digital Adoption Platforms.

 

The transaction closed on September 12, 2024, following satisfaction of regulatory and other approvals. The acquisition is expected to further expand SAP’s business transformation portfolio. WalkMe’s solutions help companies navigate ongoing technological change by providing users with advanced guidance and automation capabilities. The operating results, as well as the assets and liabilities (provisional values) are reflected in our consolidated financial statements starting from that date. The initial consideration transferred amounted to approximately €1.3 billion.

 

As the WalkMe acquisition closed shortly before September 30, 2024, we are still in the process of identifying and measuring the WalkMe assets and liabilities. Thus, the accounting for the WalkMe acquisition is preliminary. This primarily relates to intangible assets as well as tax assets and liabilities, but also to certain acquisition accounting-related matters such as the consideration transferred and certain accounting alignments.

 

In the third quarter of 2024, the contribution of WalkMe to revenue was approximately €14 million, to operating profit approximately €-14 million (IFRS) and approximately €-8 million (non-IFRS).

 

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