German software giant “SAP” increases job cuts amid positive financial results
Date
7/23/2024 4:08:41 AM
(MENAFN) The leading German software corporation “SAP” has decided to increase the scale of its planned job cuts, driven by a high volume of voluntary departures from its workforce. Originally set to reduce its workforce by 8,000 positions, the company announced late Monday that it will now be cutting between 9,000 and 10,000 jobs. This adjustment reflects a significant shift from the company's earlier plan.
Headquartered in Walldorf, Germany, the company reported a reduction in its workforce from 105,315 employees at the end of the second quarter of the year to 102,315 by the end of the first quarter. Despite these cutbacks, the company has been concentrating its efforts on expanding its artificial intelligence technologies, an area it identifies as crucial for future growth. Earlier in the year, the company unveiled a restructuring plan, aiming to streamline its operations.
Financially, the company has demonstrated strong performance despite challenging economic conditions. Its operating profits for the second quarter surpassed expectations, with earnings before interest, taxes, depreciation, and amortization (EBITDA) increasing by 33 percent year-on-year to 1.94 billion euros (USD2.11 billion). Revenue also rose by 10 percent year-on-year, reaching 8.29 billion euros compared to 7.55 billion euros the previous year.
However, the company's net profit for the second quarter saw a substantial decline of 69 percent, dropping to 918 million euros. This decrease is attributed to the absence of non-recurring profits that were realized in the same period last year from the sale of its subsidiary Qualitrix.
Despite these mixed financial results, the company has upheld its projections for the current financial year. It anticipates that the expanded job-cutting plan will contribute an additional 200 million euros in operating profits and help reduce related expenses, reflecting its ongoing commitment to financial stability and strategic growth.
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