SAP soars on firm outlook

FRANKFURT, Germany -- SAP soared more than 4 percent on Thursday after Europe's No. 1 software maker stuck to its outlook for the year and said it planned to take on Microsoft in the U.S. small business market.

Chief Executive Hasso Plattner said customer interest in SAP's software was picking up but the company still expected the next six months to be challenging, adding that there was no need to change its 2002 outlook.

SAP forecast sales to grow by about 15 percent this year, with its operating margin expected to be at least 21 percent. The outlook was presented when the company reported its first-quarter results on April 18.

"We have no other facts, we reiterate what we say," Platter said on Wednesday at SAP's annual users conference in Orlando, Florida.

While he said customer response "is positive" so far, market conditions remained challenging, particularly in the U.S.

Platter also said SAP hopes to boost weak sales in the U.S. -- where spending in technology has slowed -- by tapping into the small and medium-sized market where Microsoft is now the dominant player.

Microsoft has made significant inroads into this market through the purchase of European software company Navision and Great Plains Software of the U.S.

In addition to Microsoft, SAP plans to take market share away from other software heavyweights, such as Oracle and Siebel.

As part of its U.S. strategy, SAP on Wednesday unveiled a scaled-down version of its business software for companies at the smaller end of the market, specifically those with 1,000 employees or less.

The software has been redesigned to make it cheaper and faster, as well as easier for users to link to other systems, the company said.

Plattner said competitors should follow SAP's lead and also simplify their systems, and threw out a challenge to Microsoft co-founder Bill Gates. "I will ask Mr. Gates to change his opinion about what is allowed to be around Windows and what is not."

SAP (FSAP) shares were up 4.5 percent at 114.40 euros in midday Frankfurt trading on Thursday.