SAP and China’s Partnership Fosters Growth

SAP in China

Establishing SAP and China’s relationship, SAP’s CEO Bill McDermott told CNBC earlier this year, “We are not having challenges in China — we are doubling down in China.” He added that Beijing is the fastest growing market for the German firm.

SAP and China’s partnership remains solid and unaffected despite the bitter trade battle between the US and China as shown in the recent data gathered by Thinknum, a web platform that tracks companies websites and creates data sets measuring factors such as hiring, revenue, and foot traffic.

In Bill McDermott’s CNBC interview earlier this year, the CEO shared that SAP continues to invest in China in the same manner that China continues to invest in the German software company.

McDermott’s assertion proves to be true as shown in the data gathered by the web platform. According to the data, SAP increased its workforce in China by nearly 50% from 2018 until today at a time when most major American technology companies are stepping back from production and supply chain development in the country. The data also showed that SAP reduced the total number of global job postings it had online over the same period. The numbers considered were from the 27 July 2107 to 16 July 2019.

The German tech giant’s valiant investment in China is deemed contrasting to the American technology industry strategy of slashing more than 25 percent job postings there.

On an analyst call made by Thinknum, Luka Mucic, a member of the Executive Board and Chief Financial Officer of SAP, said that SAP managed to grow cloud and software revenue in China for its prior earnings deadline. It has to be noted that the commendable revenue growth materialized at an uncertain time when companies, including Apple, are withdrawing from China and when other technology companies that are being pushed by party officials to maintain their operations in the country.

Thinknum has also covered SAP’s Software Engineers’ Job postings. In the data gathered from 16 October 2016 to 16 July 2019, the company appears to be boosting its Software Engineer all over, rising more than threefold. Job postings this year went up to 32%. Over the last few years, the company’s postings have been relatively even ranging from a low of 1,800 to a high of around 3,500.

This year, in just seven months, SAP has substantially increased global job postings for Developers rising to 69%. 

As of July 17, SAP is up 36% with expected 1.09 a share increase of EPS as tracked by Zacks Investment Research Analysts.

Bill McDermott previously stated in the CNBC interview that SAP expects a stronger 2019, emphasizing the company’s ambitious strategy in China as SAP’s Crown Jewel. As the company’s fastest-growing market with an investment that doubles every year, China is expected to receive the German company’s support steadily as a business partner. The data shown by Thinknum aligns with that objective.

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