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SAP's cloud business flying high in China

By Ma Si (China Daily) Updated: 2016-07-22 08:09

German software company SAP SE saw triple-digit growth in its China cloud business in the second quarter of the year, as it taps into the country's e-commerce boom and local manufacturing enterprises' intensified efforts to embrace digital transformation.

The company announced on Thursday that it had double-digit growth in its software and software-related service for the third quarter in a row, defying the country's economic slowdown.

Mark Gibbs, president of SAP Greater China, said the company will maintain a strong momentum as the world's second-largest economy beefs up resources to drive innovation-led growth and high-end manufacturing.

"With more functions moving to the cloud, enterprises will accelerate their adoption of cloud services, which will become a bigger part of our business here," he said, declining to offer detailed financial figures.

As of June, more than 300 Chinese corporate customers are using S/4 HANA, the company's in-memory computing platform that can offer real-time data analysis.

About 75 percent of SAP's China customers are small and medium-sized enterprises, while more than 50 percent of China's leading State-owned firms also use its service. Most of them are from the automotive, high-tech, retail, consumer products and other industries.

SAP is competing with heavyweights such as Microsoft Corp, Oracle Corp and Salesforce.com Inc in the nascent yet highly promising cloud sector.

Data from the research firm Gartner Inc show, the global cloud computing industry will grow nearly 17 percent to $204 billion this year and it is likely to hit $312 billion in 2019.

Charlie Dai, principal analyst at Forrester Research Inc, said a number of foreign companies are seeing robust growth in their China cloud business as the country scrambles to set up data centers.

In April, Microsoft said it has 65,000 corporate customers for its Azure cloud service in China, up from about 50,000 a year earlier.

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