SAP Dumps Mid-term Targets, Cuts 2020 View As Coronavirus Bites

Adjusted operating profit is expected to reach 11.5 billion euros by 2025, while the share of more predictable revenue should grow to 85%, SAP said.

RECOVERY STALLS

SAP also cut its guidance for 2020, saying the reimposition of coronavirus lockdowns by some governments had hit its business while hard-hit industries would now take longer than expected to recover.

“While SAP continues to see robust interest in its solutions to drive digital transformation as customers look to emerge from the crisis with more resilience and agility, lockdowns have been recently re-introduced in some regions and demand recovery has been more muted than expected,” SAP said.

In particular, SAP added, it no longer anticipates a meaningful recovery in Concur, its business travel and expenses expenses application, for the remainder of this year.

SAP, headquartered in the southwestern town of Walldorf, now expects adjusted total revenue this year at 27.2 billion euros to 27.8 billion euros ($32.24-$32.95 billion), at constant currency, down from an earlier range of 27.8-28.5 billion euros.

Adjusted operating profit, also at constant currency, is now seen at between 8.1 and 8.5 billion euros. The earlier range had been 8.1-8.7 billion euros.

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