SAP Japan is a subsidiary of SAP SE, the global leader in enterprise software solutions. SAP Japan offers a wide range of cloud, on-premise, and hybrid products and services to help customers transform their business processes and operations in the digital era. SAP Japan serves more than 10,000 customers in various industries and sectors, such as manufacturing, retail, automotive, financial services, public sector, and more.
SAP Japan's performance in 2023 was driven by its strong growth in its cloud business, which increased by 21% year over year (up 28% at constant currency or cc) to €1.2 billion. SAP Japan's cloud revenues accounted for 36% of its total revenues, which rose by 6% year over year (up 13% at cc) to €3.3 billion. SAP Japan's cloud business was boosted by the adoption of Rise with SAP, a holistic solution that helps customers migrate to the cloud and become intelligent enterprises. Rise with SAP was chosen by more than 100 customers in Japan in 2023, including Asahi Kasei, Celltrion Healthcare, Itochu Corporation, and Ricoh Co. Ltd.
SAP Japan also witnessed strong demand for its business technology platform, especially its flagship ERP solution, SAP S/4HANA. SAP S/4HANA is a next-generation intelligent ERP system that leverages artificial intelligence (AI), machine learning (ML), and advanced analytics to automate and optimize business processes. SAP S/4HANA cloud revenues grew by 72% year over year (up 82% at cc) to €400 million in 2023, while SAP S/4HANA current cloud backlog surged by 63% year over year (up 72% at cc) to €900 million. SAP Japan added more than 1,000 SAP S/4HANA customers in 2023, bringing the total number of customers to over 4,000.
SAP Japan also invested in innovation and new technologies, such as generative AI, low-code/no-code, and blockchain, to enhance its product portfolio and customer experience. In September 2023, SAP Japan unveiled Joule, an innovative AI copilot driven by natural language and generative capabilities. Joule will be integrated into SAP's cloud enterprise suite and offer proactive, contextual insights from SAP solutions and third-party sources. SAP Japan also launched Grow with SAP, a solution that helps small and medium-sized enterprises (SMEs) accelerate their digital transformation and growth. SAP Japan also expanded its strategic partnerships with Microsoft, Google, Amazon, Alibaba, and others, to leverage their cloud infrastructure and capabilities.
SAP Japan's outlook for 2024 is positive, as it expects to benefit from the recovery of the Japanese economy and the increasing demand for digital transformation. SAP Japan expects its cloud revenues to grow by 18% to 21% year over year (up 20% to 23% at cc) to €1.4 billion to €1.5 billion. SAP Japan expects its total revenues to grow by 8% to 10% year over year (up 9% to 11% at cc) to €3.6 billion to €3.7 billion. SAP Japan expects its operating profit to grow by 13% to 17% year over year (up 15% to 19% at cc) to €1.1 billion to €1.2 billion.
SAP Japan is well-positioned to capture the opportunities in the enterprise software market, as it has a strong brand reputation, a loyal customer base, a diversified product portfolio, and a robust innovation pipeline. SAP Japan aims to achieve €2 billion in cloud revenues by 2025, and become one of the top 50 global end-to-end digital transformation service providers. SAP Japan is also committed to creating positive social and environmental impact, as it strives to become carbon neutral by 2025, and support the United Nations Sustainable Development Goals.
Tech Alliance edit team