SAP delivered a mixed set of results in the final quarter of 2022 as it surpassed the revenue expectations of Wall Street but missed out on earnings. Despite the macroeconomic situation, 2022 was a decent year for SAP, highlighted by its cloud performance across all geographies. The company went ahead in increasing cloud revenue by 24%. Its cloud transformation is in full swing, with recurring revenue up to 79% in 2022. This year, cloud revenue also surpassed support revenue to become SAP’s single-largest revenue stream. Their overall SaaS and PaaS portfolio grew significantly, with SaaS cloud revenue increasing by 25% and PaaS cloud revenue increasing by 45%. The business technology platform and S/4HANA cloud made a good contribution to this significant cloud expansion. The company’s otal revenue was up 5% year over year, demonstrating excellent traction driven by this strong double-digit cloud growth and an amazing performance in services. Besides that, they disclosed a partnership with ExxonMobil to develop, adopt, and support their sustainability initiatives. SAP also launched the SAP Build to propel the next wave of business transformation using the knowledge of expert business users. We give SAP a ‘Hold’ rating with a revised target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
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