SAP Reports Strong Sales in Q2, Offers Bright Outlook

Business software maker SAP on Tuesday reported strong second quarter revenue as sales of software and software-related services expanded, but the company's net profit declined due to charges related to its acquisition of France's Business Objects SA.

SAP reported a net profit of €408 million (US$641.6 million) for the second quarter, down 9 percent from the same time last year. However, sales increased 18 percent year-on-year to €2.86 billion.

"We can attribute our strong performance to good overall execution and the continued strength in all three core areas of our business, the established business, the mid-market and business user solutions," the company said in a statement.

SAP also refined its full-year 2008 outlook to the top end of its former guidance, a sign business remains strong. The company now expects full year non-GAAP software and software-related service revenue to at the top end of the 24 percent to 27 percent range it had previously given. SAP's full year operating margin will also reach the upper range of the 28.5 percent to 29 percent range provided previously.

The revised outlook figures do not include any negative impact from SAP's €4.8 billion acquisition of Business Objects, a deal that was finalized early this year. The purchase broke from SAP's traditional strategy of avoiding large acquisitions. But SAP said the deal would add thousands of new customers and a new product line in the fast growing business intelligence software segment.

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