By Supantha Mukherjee

STOCKHOLM – German business software giant SAP said Friday that its first quarter revenues rose 11%. That beats estimates based on cloud revenue. But, the company reported a revenue drop of 300 million euros (325.26 million) as a result of Russia’s exit.

In response to Moscow’s invasion of Ukraine, this company announced earlier this week it would be leaving Russia.

SAP announced that it expects its annual adjusted profit to drop by nearly 350 million euro and will have to pay restructuring fees of between 80 million and 100 million.

SAP maintained its 2022 outlook for cloud revenues of between 11.55 and 11.85 trillion euros, at constant exchange rates.

The total revenue for the quarter rose to 7.08 Billion Euros, with constant currency at 6.35 Billion euros. Refinitiv poll shows that analysts expected 6.87 trillion euros.

In the March 31st quarter, cloud and software revenues grew by 12% to 6.06 Billion Euros.

Luka Mucic, Chief Financial Officer said that the current cloud backlog increased at a healthy pace and supports our confidence in long-term plans.

The current cloud backlog (which measures inbound business) increased 28% to 9.73 billion euro during the quarter. At constant currency rates, the growth in backlog was 1.8 percentage points lower due to the war in Ukraine.

The lower contribution of Sapphire Ventures to venture capital fund investments resulted in adjusted earnings per share at 63 euro, which was below the estimates of 1.07 Euros.

($1 = 0.9223 euros)