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News > International
SAP surges as sales rise
January 8, 2001: 10:53 a.m. ET

German software house reassures market; 4Q revenues rise 27%
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LONDON (CNNfn) - SAP, Europe's biggest software maker, bolted higher in Frankfurt trading Monday after announcing better-than-expected revenue in its latest quarter.

The German company, which missed analysts' profit expectations last October and has seen its stock sink more than 60 percent since March, said revenues rose 27 percent to graphic2.1 billion ($2 billion) in the quarter through December.

SAP (FSAP) shares rocketed 18.6 percent to graphic148.35 in Monday afternoon, hitting as high as graphic153.64 – up 22.8 percent – earlier in the day. graphic

SAP credited strong software license sales, which rose by roughly 25 percent to slightly above graphic1 billion. Operating profit, excluding employee stock program costs, rose more than 40 percent to more than graphic600 million.

"It's a little bit better than expected," said Heinz Steffen, an analyst with Commerzbank Global Equities, who has a "hold" recommendation on SAP shares. "There had been tremendous rumors in the market ... this is meant to stop the free fall in its shares."

Speculation had been that SAP would report fourth-quarter revenues as low as graphic1.3 billion, Steffen said, adding that he had believed the company would post sales of about graphic1.9 billion in that quarter.

Steffen said stepped-up aggression from U.S. rival Oracle  (ORCL: Research, Estimates) and hedge fund selling of SAP shares had been hurting the German company's shares in recent months. But he said he's not ready to upgrade SAP shares just yet before the company details those numbers and holds an analysts' meeting on Jan. 24.

"The outlook still isn't bright," said Steffen.

Other investment banks became more bullish. ABN Amro raised its rating on SAP to "buy" from "hold" while Dresdner Kleinwort Benson upped SAP to "add" from "hold" on Monday after the announcement.

Shares in software firms in Europe and around the globe have been hammered in recent weeks. German Web software specialist Intershop Communications recently warned that fourth quarter earnings and revenues wouldn't meet expectations.

On Friday Anglo-American Internet search engine systems provider Autonomy (AU-), which has seen its shares tumble more than 50 percent since listing on the London Stock Exchange, became the first high-profile European company to issue a trading statement to stop investors dumping its stock. graphic

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.