Luca Mucis, the Chief Financial Officer at SAP, said that the company aims to convert 5 billion euros in revenue from support and software licenses, into cloud subscriptions, in the next five years. The CFO spoke with investors on a conference call with Morgan Stanley, where he elaborated on the so-called ‘RISE with SAP’ program.
It is designed to take on-premises users to the cloud computing format. Mucic detailed how finances would be affected by this.
He said that a rough calculation by SAP shows that over the next five years, the company will see about €2.5 billion in revenue from software support, migrating to the cloud.
The projections
It is also probable, according to Mucic, that a similar amount of revenue will be received in the next five years, from people who would have signed a traditional license model to get software licenses.
RISE with SAP is designated as a service, software, and hosting solution that can include a lift and shift of existing portfolios to the cloud. It also incorporates some process analysis, moving to an advanced and HANA-backed version of the software and several business process changes.
The process has some caveats, like users not wanting to use just one source of enterprise solutions.
More money
SAP has its own reasons for pushing people to transition to the cloud and they go beyond wanting to look modern or become as ubiquitous as Salesforce or Workday. Mucic pointed out that a move like this gives SAP a bigger “share of wallet” among its customers.
Customers on the RISE with SAP program will no longer need to buy software, meaning that they get more than just maintenance for their money.
SAP is looking to double revenue after five years, in what can only be described as a ‘cloud multiplier’ program.
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