SAP SE is a Germany-based enterprise software company best known for its SAP S/4HANA business suite and other cloud-oriented software products. Founded by a handful of former IBM employees in 1972, the company has since grown into one of the largest software and programming companies in the world. The past decade has been particularly successful for the company, with annual revenues more than doubling over the past ten years and net profit increasing from around 1.8 billion Euros to over five billion during that same time period. This rapid increase in fortune is at least partially a result of the company’s early adoption of cloud technology and the inclusion of these cloud features in the company’s products. With a research and development budget over five billion euros and a healthy portfolio of recent acquisitions, SAP has shown its commitment to remaining at the very top of the software market for years to come.
Global spending on enterprise software has continually increased over the past decade and forecasts suggest that this growth will continue in the near future, after offsetting the slight decline as a result of the coronavirus (COVID-19) outbreak in 2020. With its popular SAP S/4HANA suite currently amassing around 20,000 subscribers, SAP is well positioned for success within a rapidly growing market. In addition to its strength in the enterprise resource planning (ERP) software market, SAP has also built strong positions within many parallel software markets such as supply chain management, customer relationship management (CRM), and business process management (BPM).
SAP’s role in business development
One byproduct of these various enterprise-level software packages is a massive amount of business data that can be used to progress business development. Through the combination of this data and analytics software, companies can further their understanding of the impacts of business strategies both within their organization and among their customers. Conveniently, SAP’s main revenue segments are software support, cloud, services, and software licenses, thereby bundling and offering a massive range of business tools under one single company, making it simple for their customers at nearly every stage of business development.
The combination of this strong base of software offerings along with the company’s investment into cloud computing bodes well for its continued success. SAP is among the world’s leading cloud vendors among the likes of Microsoft and Amazon, and brings in billions of euros per year from its cloud segment. As features such as data-based analytics and platform scalability grow from useful tools into necessary qualities for business growth and competition, the offerings of companies like SAP should only grow in demand.
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Lionel Sujay Vailshery
Research expert covering the consumer electronics industry