Despite recording a record third quarter, enterprise software vendor SAP has a long way to go to convince financial analysts of its stability.
SAP's overall turnover for the three months ended 30 September was up 27 per cent on last year to 1.4bn euros (£810m), but turnover only just met analyst expectations at 88m euros.
Significantly, the new mySAP.com line generated 294m euros in turnover from zero last year. Henning Kagermann, SAP co-chairman, said: "The third quarter was a breakthrough for mySAP.com. It accounted for 70 per cent of all new software sales."
Overall, this was a much better performance than last year. But direct comparisons with 1999 have to be taken with care, because last year was extremely difficult for SAP.
This year, licence turnover, a key indicator of health, was up 53 per cent. But, alarmingly for resellers, service revenue was flat. Kagermann stressed that the company is in a period of transition, and claimed: "We have stabilised the [US] sales force."
This had been a cause for analyst concern last year as SAP haemorrhaged key staff, losing more than 200 top executives over the previous two years.
The company took the opportunity to defend itself against recent criticism and lost deals during a conference call to analysts. Commenting on the $142m (£98m) Siemens deal that SAP missed out on to supply chain vendor i2, SAP co-chairman Hasso Plattner said: "We didn't compete. It was a decision for Siemens on a new project." However, Plattner said SAP had won contracts with Sony, Compaq and Palm from i2.
Another recent question mark has been whether the joint work for SAP Markets undertaken with partner CommerceOne had really been completed in the two months claimed by SAP. Plattner confirmed that there was joint engineering, but that the coding was done by SAP. He said SAP Markets was able to complete coding in about 60 days, because "there is no overlap in functionality".
Finally, there had been rumours that Lucent, SAP's leading US customer, was abandoning the company in favour of Oracle. SAP has denied this, however.
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