The vendor claimed many of these changes will be addressed through voluntary leave programmes and internal re-skilling measures.
SAP revealed that costs associated with its ongoing reorganisation have climbed to an estimated €3 billion, up from previous projections.
In the second quarter of 2024, SAP recorded additional restructuring expenses of €600 million, bringing the total for the year's first half to €2.9 billion.
This increase is primarily attributed to the strong employee response to voluntary leave options. It would seem that staff are more keen to exit the building than managers thought.
Despite the significant number of affected positions, SAP anticipates its overall headcount at the end of 2024 to remain similar to year-end 2023 levels as the company reinvests in strategic growth areas.
Despite these restructuring expenses, SAP reported strong financial results for the second quarter of 2024, particularly in its cloud business.
Cloud revenue increased by 25 per cent to €4.15 billion, driven by a 33 per cent growth in cloud ERP Suite to €3.41 billion.
Current cloud backlog grew by 28 per cent to €14.81 billion and total revenue was up ten per cent to €8.29 billion.
Cloud gross profit rose 29 per cent (IFRS) to €3.03 billion.
Non-IFRS operating profit increased by 33 per cent to €1.94 billion, supported by strong revenue growth and disciplined execution of the transformation programme.
Free cash flow in Q2 increased by 114 per cent to €1.3 billion, despite €500 million in restructuring cuts.
However, software licences revenue decreased by 28 per cent to €200 million, reflecting the ongoing shift towards cloud-based solutions.
IFRS operating profit decreased by 11 per cent to €1.22 billion, primarily due to the €600 million in restructuring expenses. Despite this, IFRS earnings per share increased by 22 per cent to €0.76, while non-IFRS earnings per share rose 59 per cent to €1.10.
SAP said the reorganisation underscores its commitment to positioning itself at the forefront of the AI revolution in business software.