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SAP Updates Mid-Term Financial Ambition 2025 and Announces Share Repurchase Program of up to €5 Billion
Today at SAP Sapphire in Orlando SAP SE (NYSE: SAP) announced an update of its mid-term financial Ambition 2025 as well as a new share repurchase...
About this update from Sap Se
[{"type":"text","content":"\n \n\t\t \n \n \n \n WALLDORF, Germany, May 16, 2023 /PRNewswire/ -- Today at SAP Sapphire in Orlando SAP SE (NYSE: SAP) announced an update of its mid-term financial Ambition 2025 as well as a new share repurchase program with a volume of up to €5 billion.\nAmbition 2025 UpdateSAP's Ambition 2025 update demonstrates SAP's strong cloud momentum, with a cloud revenue ambition of more than €21.5bn excluding Qualtrics. The updated ambition reflects the expected divestiture of Qualtrics (NASDAQ: XM) as well as an update on the expected 2025 performance of SAP's continuing operations. This update on SAP's continuing operations is mainly driven by the anticipation of continued rapid cloud revenue growth, a great degree of resilience from the increasing share of recurring revenues, the value of the support and services business, as well as a more favorable currency environment as compared to the original ambition, published in October 2020.\nFor 2025, the company now expects:\n\n Cloud revenue of more than €21.5bn\n Total revenue of more than €37.5bn\n Non-IFRS cloud gross profit of approximately €16.3bn\n Non-IFRS operating profit of approximately €11.5bn\n A share of more predictable revenue of approximately 86%\n Free cash flow of approximately €7.5bn\n\nReflecting current exchange rates, the new Ambition 2025 is based on an exchange rate of 1.10 USD per EUR.\n\n \n \n \n \n \n Building Blocks of the Ambition 2025 Update \n \n \n \n \n \n \n Original Ambition 2025 (incl. Qualtrics) \n Estimated Impact of Qualtrics divestiture \n Update for continuing operations (2) \n Updated Ambition 2025 (excl. Qualtrics) \n CAGR 2022-2025e (continuing operations) \n \n \n Cloud revenue \n >€22.0bn \n –€2.0bn \n +€1.5bn \n >€21.5bn \n >23% \n \n \n Total revenue \n >€36.0bn \n –€2.3bn \n +€3.8bn \n >€37.5bn \n >8% \n \n \n Cloud gross profit (non-IFRS) \n ~€17.6bn(1) \n –€1.8bn \n +€0.5bn \n ~€16.3bn \n ~27% \n \n \n Operating profit (non-IFRS) \n >€11.5bn \n –€0.5bn \n +€0.5bn \n ~€11.5bn \n ~13% \n \n \n Free cash flow \n ~€8.0bn \n –€0.3bn \n –€0.2bn \n ~€7.5bn \n ~20% \n \n \n \n \n \n\n\n \n \n \n \n \n \n \n \n \n (1) \n Absolute cloud gross profit ambition implied by the original Ambition 2025 of at least €22 billion of cloud revenue and a cloud gross margi...