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SAP struggles to exit Russia after sale of support unit stalled

Datacenters, cloud services shut down but keep maintaining DBs for the nation's businesses

SAP has delayed its withdrawal from Russia after struggling to find a buyer for its operations in the region.

After Russia invaded Ukraine in February 2022, many tech multinationals sought to withdraw from the country. SAP’s approach was met with a volley of criticism for still supporting its products in Russia, even after ending new sales. Ukrainian president Volodymyr Zelenskyy called SAP out in a tweet, alongside Microsoft and Oracle, for servicing technology in Russia.

In April, the company agreed to end all operations in the country, giving cloud subscribers the option of having their data deleted, returned, or migrated to a datacenter outside of Russia. For on-premises products, SAP said it was evaluating ways to exit support and maintenance while honoring obligations to non-sanctioned customers.

According to a report from Reuters, SAP is set to miss the deadline to exit Russia before the end of the year as it has still not found a buyer for the unit.

SAP has shut its datacenters and cloud business Russia, but has been honoring annual contracts for its maintenance business.

"SAP is fully committed to winding down our business in Russia as quickly as possible. Recent legal developments in Russia have, however, limited our options with regard to the final steps of our exit," an SAP spokesperson told The Register.

The news came as the German software giant posted mixed Q3 results. Total revenue hit €7.84 billion ($7.81 billion), up 15 percent on a year earlier. Cloud revenue sped ahead, climbing 38 percent to reach €3.29 billion ($3.28 billion).

However, adjusted operating profit flatlined and revenue from software licenses fell.

TechMarketView analyst Angela Eager said SAP was on track to meet its mid-term ambition of double digit operating profit in 2023. She said the company is set to raise it ambition in upcoming quarters in the light of cloud revenue growth expectations to reach 23-26 percent. The company also benefited from favorable currency exchange rate developments, given SAP reports in Euros, which have fallen against the dollar.

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