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SAP thinks cloud has stuffed it up



Slow sales

The business software maker, which no one is certain what it does, SAP said that the cloud has stuffed up its profit targets.

 

While some software companies are making a killing on the cloud, the german maker of esoteric software said that additional investments in its cloud business would delay reaching its profit target. SAP said its operating margin goal of 35 percent would now be reached in 2017 instead of 2015.

SAP and rivals such as IBM and Oracle are dashing to meet surging demand for cloud computing, which allows clients to reduce costs by ditching bulky local servers for network-based software and storage in remote data centres. In a statement, SAP said the fast-growing cloud business would create a more predictable stream of revenue, but it needed more time to get a viable business going.

Total revenues would reach at least 22 billion euros by 2017, of which between 3-3.5 billion is expected to come from SAP's cloud business.

Last modified on 22 January 2014
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