Europes largest software company, SAP AG, announced first quarter earnings today that matched its expectations, but still showed a marked decline in license revenues.
For the three months ended March 31, revenues for the enterprise software developer increased 9 percent over the same period last year, to 1.66 billion euros ($1.48 million), versus 1.52 billion euros ($1.48 million).
License revenues were down by 12 percent over the same period last year, falling to 402 million euros ($358 million) from 458 million euros ($408 million).
"As the new year began, companies in the Americas approached new software investments cautiously. Europe once again delivered an encouraging performance and contributed significantly to our overall revenue figure," said Henning Kagermann, co-chairman and CEO of SAP, during the Walldorf, Germany, companys earnings call.
The shortfall in software sales was offset somewhat by an 18 percent hike in consulting revenues, which were 539 million euros ($480 million) in the quarter.
Net income for the first quarter, adjusted for the TopTier Software Inc. acquisition costs and the impact of SAPs investment in Commerce One Inc., was 121 million euros ($108 million), up from 117 million euros ($104 million)in the same quarter last year. SAP owns twenty percent of Commerce One and has invested a significant amount in joint technology development. Commerce One, of Pleasanton, Calif., has fallen on hard times during this countrys economic slump, as is evidenced by its stock price, which was trading at $1.36 a share at mid-day today, down from $13.94 a share almost a year ago.
SAP purchased TopTier, an enterprise portal software company, last March for about $40 million.
While SAP has been careful to quell expectations of a strong first quarter this year, it continues to expect 15 percent sales growth in 2002, according to officials. Traditionally, about a third of revenues are generated in the last three months of the year.