Exhibit 99.1

SAP Announces Q3 2023 Results

in € millions, unless otherwise stated; based on SAP group results from continuing operations

	Christian Klein, CEO:			Dominik Asam, CFO:
"Our Q3 results are yet another proof point that we have entered the next phase of our transformation. We accelerated cloud growth across our portfolio and significantly expanded our cloud gross margins. Our strong focus on innovation, including our latest SAP Business AI capabilities, ensure SAP's continued resiliency in the face of tough macroeconomic conditions and increasing geopolitical tensions."			"Our Q3 results demonstrate strong execution and the resilience of our business, including sustained cloud growth in spite of persisting macro headwinds. Also, we carefully balance growth and profitability at all times. In combination, this allows us to boost our bottom-line with the aim to achieve double-digit operating profit growth this year."

Walldorf, Germany – October 18, 2023.
SAP SE (NYSE: SAP) today announced its financial results for the third quarter ended September 30, 2023.

All figures in this statement are based on SAP group results from continuing operations unless otherwise noted. See section (M) Discontinued Operations.

Financial Performance

Group results at a glance – Third quarter 2023

1 For a breakdown of the individual adjustments see table “Non-IFRS Adjustments by Functional Areas” in this Quarterly Statement.

2 From continuing and discontinued operations.

Group results at a glance – Nine months ended September 2023

1 For a breakdown of the individual adjustments see table “Non-IFRS Adjustments by Functional Areas” in this Quarterly Statement.

2 From continuing and discontinued operations.

Financial Highlights1

Third Quarter 2023

Current cloud backlog grew by 19% to €12.27 billion and was up 25% at constant currencies. SAP S/4HANA current cloud backlog was up 58% to €4.20 billion and up 66% at constant currencies.

In the third quarter, cloud revenue was up 16% to €3.47 billion and up 23% at constant currencies, mainly driven by the growth of SAP’s combined SaaS and PaaS portfolio, which was up 19% and up 26% at constant currencies. SAP S/4HANA cloud revenue was up 67% to €914 million and up 77% at constant currencies.

Supported by a few major transactions, software licenses revenue decreased by 17% to €335 million and was down 14% at constant currencies. Cloud and software revenue was up 4% to €6.68 billion and up 9% at constant currencies. Services revenue was flat at €1.07 billion and up 4% at constant currencies. Total revenue was up 4% to €7.74 billion and up 9% at constant currencies.

The share of more predictable revenue increased by 2 percentage points to 82% in the third quarter.

Cloud gross profit was up 21% (IFRS) to €2.53 billion, up 21% to €2.56 billion (non-IFRS), and up 28% (non-IFRS at constant currencies). Cloud gross profit growth was supported by a strong increase in cloud gross margins. IFRS cloud gross margin was up 2.9 percentage points to 72.7%, non-IFRS cloud gross margin up 2.9 percentage points to 73.7% and up 2.9 percentage points at constant currencies.

IFRS operating profit increased 11% to €1.72 billion. Non-IFRS operating profit was up 10% to €2.28 billion and up 16% at constant currencies. The increase was supported by the resilience of our on-premise business as well as continued operational discipline, which overcompensated the negative impact of an accelerated amortization of capitalized sales commissions related to the on-premise business (see section (O) Capitalized Cost from Contracts with Customers – Costs of Obtaining Customer Contracts).

IFRS earnings per share (basic) increased 45% to €1.09. Non-IFRS earnings per share (basic) increased 32% to €1.45. The effective tax rate was 27.8% (IFRS) and 27.1% (non-IFRS).

Free cash flow in the third quarter increased by 69% to €865 million. While payments for taxes and share-based compensation increased, the positive development was driven by SAP’s profitability, improvements in working capital and lower payments for capex and leasing. For the first nine months, free cash flow was up 29% to €3.42 billion.

Share Repurchase Program

On May 16, SAP announced a new share repurchase program with an aggregate volume of up to €5 billion and a term until December 31, 2025. As of September 29, SAP had repurchased 7,190,252 shares at an average price of €125.49 with a purchased value of approximately €902 million under the program.

1 The Q3 2023 results were also impacted by other effects. For details, please refer to the disclosures on page 29 of this document.

Business Highlights

Segment Results at a Glance

SAP’s reportable segment showed the following performance:

1 Segment information for comparative prior periods were restated to conform with the new segment composition.

2 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS.

3 Platform as a service: PaaS primarily includes SAP Business Technology Platform and SAP Signavio.

4 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud.

In the third quarter, segment revenue in AT&S was up 3% to €7.46 billion and up 9% at constant currencies, primarily due to strong cloud revenue growth, which was supported by SAP S/4HANA as well as Business Technology Platform. Operating Expenses of the segment decreased by 3% and increased by 2% at constant currencies, resulting in a segment margin of 35.7% and 35.8% at constant currencies. This implies a growth of 4.3 percentage points and 4.4 percentage points at constant currencies compared to the third quarter of the prior year.

Cloud Performance

1 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS.

2 Platform as a service: PaaS primarily includes SAP Business Technology Platform and SAP Signavio.

3 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud.

Due to rounding, numbers may not add up precisely.

Business Outlook

Financial Outlook 2023

For 2023, SAP continues to expect:

While SAP’s 2023 financial outlook is at constant currencies, actual currency reported figures are expected to be impacted by currency exchange rate fluctuations as the Company progresses through the year. See the table below.

Currency Impact Assuming September 2023 Rates Apply for 2023

Non-Financial Outlook 2023

SAP continues to focus on three non-financial indicators: customer loyalty, employee engagement, and carbon emissions.

In 2023, SAP continues to expect:

2 The guidance is based on an adjusted methodology for 2023 to better reflect the business priorities of the company.

Additional Information

This press release and all information therein is preliminary and unaudited. Due to rounding, numbers may not add up precisely.

SAP Performance Measures

For more information about our key growth metrics and performance measures, their calculation, their usefulness, and their limitations, please refer to the following document on our Investor Relations website: https://www.sap.com/investors/performance-measures

Webcast

SAP senior management will host a financial analyst conference call on Wednesday, October 18th at 11:00 PM (CEST) / 10:00 PM (BST) / 5:00 PM (EDT) / 2:00 PM (PDT). The conference will be webcast on the Company’s website at https://www.sap.com/investor and will be available for replay. Supplementary financial information pertaining to the third quarter results can be found at https://www.sap.com/investor.

About SAP

SAP’s strategy is to help every business run as an intelligent enterprise. As a market leader in enterprise application software, we help companies of all sizes and in all industries run at their best: SAP customers generate 87% of total global commerce. Our machine learning, Internet of Things (IoT), and advanced analytics technologies help turn customers’ businesses into intelligent enterprises. SAP helps give people and organizations deep business insight and fosters collaboration that helps them stay ahead of their competition. We simplify technology for companies so they can consume our software the way they want – without disruption. Our end-to-end suite of applications and services enables business and public customers across 25 industries globally to operate profitably, adapt continuously, and make a difference. With a global network of customers, partners, employees, and thought leaders, SAP helps the world run better and improve people’s lives. For more information, visit www.sap.com.

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Contents

Financial and Non-Financial Key Facts
(IFRS and Non-IFRS)

1  During the third quarter 2023, SAP identified a need for an error correction in the accounting related to the divestiture of Qualtrics as reported in Q2. The affected financial statement line items have been restated. The error correction is limited to SAP’s discontinued operations. SAP’s continuing operations net income as well as total operating, investing, or financing cash flows for the second quarter ended June 30, 2023, were not impacted. For details, please refer to section (N) Correction of Q2 2023 Qualtrics divestiture reporting in this quarterly statement. 

2 From continuing and discontinued operations. 

3 To conform to refined calculation logic, prior quarters have been adjusted. 

4 In full-time equivalents. 

5 In CO2 equivalents. SAP’s carbon emission numbers are rounded to the nearest 5 kt. Therefore, the rounded full-year totals may not precisely equal the sum of the rounded quarterly numbers. 

Primary Financial Statements of SAP Group (IFRS)

(A)          Consolidated Income Statements

(A.1)       Consolidated Income Statements – Quarter

1 For the three months ended September 30, 2023 and 2022, the weighted average number of shares was 1,168 million (diluted 1,180 million) and 1,168 million (diluted: 1,173 million), respectively (treasury stock excluded). 

2 From continuing and discontinued operations 

(A.2)    Consolidated Income Statements – Year-to-Date

1 For the nine months ended September 30, 2023 and 2022, the weighted average number of shares was 1,168 million (diluted: 1,179 million) and 1,172 million (diluted: 1,175 million), respectively (treasury stock excluded).

2 From continuing and discontinued operations 

(B)       Consolidated Statements of Financial Position

(C)       Consolidated Statements of Cash Flows

1 We do no longer show cash flows linked to the supply chain financing (SCF) transactions from Taulia in investing/financing cash flow separately and therefore adjusted the comparative figures accordingly.

Due to rounding, numbers may not add up precisely.

Non-IFRS Numbers

(D)       Basis of Non-IFRS Presentation

SAP disclose certain financial measures such as expense (non-IFRS) and profit measures (non-IFRS) that are not prepared in accordance with IFRS and are therefore considered non-IFRS financial measures.

For a more detailed description of all of SAP’s non-IFRS measures and their limitations as well as SAP’s constant currency and free cash flow figures, see Explanation of Non-IFRS Measures online.

(E)       Reconciliation from Non-IFRS Numbers to IFRS Numbers

(E.1)    Reconciliation of Non-IFRS Revenue – Quarter

(E.2)    Reconciliation of Non-IFRS Operating Expenses – Quarter

(E.3)    Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Quarter

1 From continuing and discontinued operations

2 The difference between our effective tax rate (IFRS) and effective tax rate (non-IFRS) in Q3 2023 and Q3 2022 mainly resulted from tax effects of share-based payment expenses, restructuring expenses and acquisition-related charges.
 

(E.4)    Reconciliation of Non-IFRS Revenue – Year-to-Date

(E.5)    Reconciliation of Non-IFRS Operating Expenses – Year-to-Date

(E.6)    Reconciliation of Non-IFRS Profit Figures, Income Tax, and Key Ratios – Year-to-Date

1 From continuing and discontinued operations

2 The difference between our effective tax rate (IFRS) and effective tax rate (non-IFRS) in the first nine months of 2023 and 2022 mainly resulted from tax effects of share-based payment expenses, restructuring expenses and acquisition-related charges. 

(F)       Non-IFRS Adjustments – Actuals and Estimates

(G)       Non-IFRS Adjustments by Functional Areas

1 Share-based Payments

2 Regulatory Compliance Matters

1 Share-based Payments 

2 Regulatory Compliance Matters 

If not presented in a separate line item in our income statement, the restructuring expenses would break down as follows:

Disaggregations

(H)      Segment Reporting

(H.1)    Segment Policies and Segment Changes

SAP has one reportable segment: the Applications, Technology & Services segment.

At the end of the second quarter 2023, we sold Qualtrics, formerly a reportable segment which derived its revenues mainly from the sale of experience management cloud solutions. For more information related to the sale of Qualtrics, see Note (M) in this quarterly statement.

For a more detailed description of SAP’s segment reporting, see Note (C.1) “Results of Segments” of our Consolidated Half-Year Financial Statements 2023.

(H.2)    Segment Reporting – Quarter

Applications, Technology & Services1

1 Segment information for comparative prior periods were restated to conform with the new segment composition. 

2 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS. 

3 Platform as a service: PaaS primarily includes SAP Business Technology Platform and SAP Signavio. 

4 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud. 

5 Mainly derived from Applications, Technology & Services segment.

Reconciliation of Cloud Revenues – Quarter

1 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS. 

2 Platform as a service PaaS primarily includes SAP Business Technology Platform and SAP Signavio. 

3 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud

Applications, Technology & Services1

1 Segment information for comparative prior periods were restated to conform with the new segment composition.

2 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS.

3 Platform as a service: PaaS primarily includes SAP Business Technology Platform and SAP Signavio.

4 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud.

5 Mainly derived from Applications, Technology & Services segment.

Reconciliation of Cloud Revenues and Gross Profit – Year-to-Date

1 Software as a service: SaaS comprises all other offerings which are not shown as PaaS and IaaS.

2 Platform as a service: PaaS primarily includes SAP Business Technology Platform and SAP Signavio.

3 Infrastructure as a service: A major portion of IaaS comes from SAP HANA Enterprise Cloud.

1 to the updated cost allocation policy described in Note (L), headcount numbers for the comparative period were adjusted accordingly.
2 Acquisitions closed between January 1 and September 30 of the respective year.

Other Disclosures

(K) Financial Income, Net

In the third quarter of 2023, finance income mainly consisted of gains from disposals and fair value adjustments of equity securities totaling €53 million (Q3/2022: €91 million) and €239 million in the first nine months of 2023 (Q1-Q3/2022: €554 million), and interest income from loans and receivables, other financial assets (cash, cash equivalents, and current investments) as well as from derivatives amounting to €153 million in the third quarter of 2023 (Q3/2022: €58 million) and €343 million in the first nine months of 2023 (Q1-Q3/2022: €123 million).

In the third quarter of 2023, finance costs were primarily impacted by losses from disposals and fair value adjustments of equity securities amounting to €103 million (Q3/2022: €397 million) and €329 million in the first nine months of 2023 (Q1-Q3/2022: €940 million) and interest expense on financial liabilities including lease liabilities and negative effects from derivatives amounting to €134 million in the third quarter of 2023 (Q3/2022: €65 million) and €504 million in the nine months of 2023 (Q1-Q3/2022: €162 million).

(L) Updated Cost Allocation Policy

Starting January 1, 2023, all activities related to changes in the code of SAP’s cloud and on-premise solutions are treated as development-related activities. Some of those activities, specifically code corrections, were previously considered as support-related activities. SAP believes this update aligns SAP’s accounting policy with market standards and increases comparability to its peers.

In the third quarter 2023, this update of our cost allocation policy resulted in an increase of the cloud gross profit by approximately €25 million, an increase of the software license and support gross profit by approximately €65 million, and an increase of our R&D expenses by approximately €85 million.

In the first nine months of 2023, the update of our cost allocation policy led to an increase of the cloud gross profit by approximately €70 million, an increase of the software license and support gross profit by approximately €195 million, and an increase of our R&D expenses by approximately €265 million.

For the full year 2023, the updated cost allocation policy is expected to result in decreased cost of cloud by approximately €95 million and cost of support by approximately €260 million, while in consequence increased R&D expenses by approximately €355 million.

Had SAP applied this accounting policy in 2022, its cost of cloud, cost of software licenses and support and R&D expense would have been as follows:

(M) Discontinued Operations

The sale of Qualtrics has closed in Q2 2023. For the full disclosure, please refer to section (M) Discontinued Operations in SAP’s quarterly statement Q2 2023. During the third quarter 2023, SAP identified a need for an error correction in the accounting related to the divestiture of Qualtrics as reported in Q2. The affected financial statement line items have been restated. For details, please refer to section (N) Correction of Q2 2023 Qualtrics divestiture reporting in this quarterly statement.

The P&L line item “Profit (loss) from discontinued operation” still reflects the Qualtrics activities up to the date of the sale (the comparative figures have been adjusted accordingly). In the third quarter 2023, tax payment of €0,7bn relating to the gain on the sale of Qualtrics were made. These payments were recognized in SAP’s discontinued operations, reducing the investing cash flow. Financial information relating to Qualtrics is presented in the following tables (revenues and expenses are presented after consolidation of transactions between Qualtrics and SAP’s continuing operations):

1 For 2023, € 0.9 billion is relating to the gain on sale of discontinued operations.

2 For the nine months ended September 30, 2023 and 2022, the weighted average number of shares was 1,168 million (diluted 1,179 million) and 1,172 million (diluted: 1,175 million), respectively (treasury stock excluded).

(N) Correction of Q2 2023 Qualtrics divestiture reporting

During the third quarter 2023, SAP identified a need for an error correction in the accounting related to the divestiture of Qualtrics as reported in Q2. The error correction is limited to SAP’s discontinued operations. SAP’s continuing operations net income as well as total operating, investing, or financing cash flows for the second quarter ended June 30, 2023, were not impacted.

Specifically, the taxable gain was determined to be incorrect, with the adjustment leading to an increase in tax expenses from discontinued operations of €0.4 billion. In addition, the distribution of income taxes to the owners of parent and non-controlling interests was adjusted. The error correction has been addressed by restating each of the affected financial statement line items for the second quarter as well as half-year 2023 information. The following tables summarize the impacts on the Group’s consolidated financial statements.

Impact of adjustments on consolidated statements of financial position

Impact of adjustments on consolidated income statements

1 From continuing and discontinued operations

2 For the three months ended June 30, 2023, the weighted average number of shares was 1,169 million (diluted 1,180 million), treasury stock excluded. For the six months ended June 30, 2023, the weighted average number of shares was 1,168 million (diluted 1,176 million), treasury stock excluded.

Impact of adjustments on consolidated income statements – discontinued operations

1 For 2023. €0.9 billion relates to the gain on sale of discontinued operations.
2 For the three months ended June 30, 2023, the weighted average number of shares was 1,169 million (diluted 1,180 million), treasury stock excluded. For the six months ended June 30, 2023, the weighted average number of shares was 1,168 million (diluted 1,176 million), treasury stock excluded.

As disclosed in Consolidated Financial Statements for 2022, Note (A.3), the determination of the amortization period for capitalized sales commissions requires judgement. In exercising this judgment, we consider our expectation about future contract renewals which we evaluate periodically to confirm that the resulting amortization period properly reflects the expected contract life or if there are potential indicators of impairment. The latest review of the amortization periods resulted in a shorter contract life for on-premise support contracts. As a result of this assessment, we have impaired the related capitalized sales commissions in the amount of €65 million as of September 30, 2023. For Q4 2023 SAP estimates this change in contract life to result in higher amortization costs of approximately €61 million and resulting in an estimated impact for the full year 2024 of €126 million. The amortization periods now range from 18 months to seven years depending on the type of offering.