By Mauro Orru

SAP SE on Friday updated its guidance for the year to account for the stake in Qualtrics International Inc. that it is divesting as the group continues to focus on its cloud business, the main driver of revenue growth in the first quarter.

Reporting on a non-IFRS basis, the Walldorf, Germany-based software company said total revenue climbed to 7.44 billion euros ($8.16 billion) in the first three months from EUR6.77 billion in last year's first quarter. Cloud revenue jumped to EUR3.18 billion from EUR2.57 billion, while software-licenses revenue slipped to EUR276 million from EUR317 million.

Operating profit increased to EUR1.88 billion from EUR1.68 billion, with its operating margin up to 25.2% from 24.8%.

SAP, like other European software companies, presents its figures as two sets of numbers. One set is based on the International Financial Reporting Standards--an international accounting method that seeks to provide a global reporting standard--though analysts and investors tend to follow SAP's non-IFRS numbers. Those figures exclude share-based compensation, restructuring expenses and acquisition-related charges.

For 2023, SAP now expects non-IFRS operating profit at constant currencies between EUR8.6 billion and EUR8.9 billion instead of EUR8.8 billion to EUR9.1 billion as previously expected. Cloud revenue at constant currencies should come in between EUR14 billion and EUR14.4 billion, below a previous forecast of EUR15.3 billion to EUR15.7 billion.

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

(END) Dow Jones Newswires

April 21, 2023 01:39 ET (05:39 GMT)

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