FRANKFURT SAP, Europe's largest software company, reported slightly lower-than-expected first-quarter core profit as it sold more of its cloud products, which are less profitable.
First-quarter operating profit, excluding special items, for the German software maker rose 8 percent to 1.198 billion euros ($1.30 billion), the company said in a statement on Tuesday.
That was slightly below the average of 1.229 billion euros in a Reuters poll of 13 analysts, with individual estimates ranging from 1.183 billion to 1.298 billion.
Revenues rose 12 percent to 5.285 billion euros, which was above average expectations of 5.179 billion.
SAP's customer base moved further to newer cloud-based and less profitable Internet platforms from classic high-margin packaged software products it has sold for decades.
New cloud bookings jumped 49 percent to 215 million euros during the first quarter.
"We continued our rapid expansion in cloud," SAP's finance chief Luka Mucic said in a statement. "We're off to a good start to reach our full-year targets and we are confident that we will grow our profitability in 2018 and beyond."
SAP said it still expects revenue for 2017 of 23.2 to 23.6 billion euros, while operating profit is seen at 6.8-7.0 billion euros, both at constant currencies.
SAP shares were indicated to open 1.1 percent lower at the bottom of the German blue chip index which is indicated to open 0.5 percent higher, according to pre-market data of German brokerage Lang & Schwarz.
SAP shares reached an all-time high of 92.99 euros on Monday, giving it a market capitalization of more than 112 billion euros. SAP is Europe's most valuable technology company.
(Reporting by Harro ten Wolde; Editing by Christoph Steitz and Muralikumar Anantharaman)