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SAP posts mixed results

July 21, 2015

Europe's largest software maker, SAP, has logged mixed second-quarter results as it continues to widen its cloud-based subscription models. But severance payments are eating into the company's after-tax earnings.

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SAP logo
Image: picture-alliance/dpa

German business software maker SAP on Tuesday reported sound second-quarter operating profit and turnover.

The Walldorf-based company saw its revenues rising by 20 percent to total 4.97 billion euros ($5.38 billion).

The firm said the good result was largely attributable to a continuously strong dollar and growing subscription business for cloud-based software.

Excluding the effect of translating other currencies into the euro, SAP's revenues increased by about 8 percent.

Streamlining operations

Second-quarter earnings after taxes amounted to just 469 million euros, marking a 16-percent drop as a severance payment program kept hitting profits.

As SAP is in the process of shedding some of its older business lines and renting more software online, there will be changes for an estimated 74,000 employees globally in the course of the year.

Cloud Computing - Opportunities and Risks

Some employees look set to move to different units within the company, while others are being offered a severance payment to voluntarily leave the firm.

SAP on Tuesday stuck to its full-year outlook, adding that by the end of the year it would employ more people than in 2014 despite the temporary restructuring effort.

hg/pad (Reuters, dpa)