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Welcome to SAP Capital Markets Day 2019

Luka Mucic Bill McDermott


Chief Financial Officer Chief Executive Officer
Executive Board Member

Rob Enslin Christian Klein


President, Cloud Business Group Chief Operating Officer
Executive Board Member Executive Board Member

Jennifer Morgan
President, Global Customer Operations Juergen Mueller
Americas & Asia Pacific Japan Chief Technology Officer
Executive Board Member Executive Board Member

Alex Atzberger
President, SAP Customer Experience

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 1


Agenda
09:30 – 09:35 am Welcome
Stefan Gruber, Head of Investor Relations
09:35 – 10:05 am Strategy and Vision: Opportunity in Time of Disruption
Bill McDermott, CEO
10:05 – 10:30 am Delivering the Intelligent Enterprise
Christian Klein and Juergen Mueller, Executive Board Members
10:30 – 10:45 am Break
10:45 – 11:15 am SAP C/4HANA Shaking up CRM
Alex Atzberger, President SAP Customer Experience
11:15 – 11:45 am Customer Perspective
Hosted by Jennifer Morgan, Executive Board Member
11:45 am – 12:10 pm Charting the Course for 2023
Luka Mucic, CFO and Executive Board Member
12:10 – 12:55 pm Q&A
12:55 – 2:00 pm Buffet Lunch Reception
02:15 – 03:45 pm Breakout Sessions
03:45 – 04:30 pm Coffee and Networking
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3
Safe Harbour Statement

Any statements contained in this document that are not historical facts are
forward-looking statements as defined in the U.S. Private Securities Litigation
Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,”
“forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar
expressions as they relate to SAP are intended to identify such forward-looking
statements. SAP undertakes no obligation to publicly update or revise any forward-
looking statements. All forward-looking statements are subject to various risks and
uncertainties that could cause actual results to differ materially from expectations.
The factors that could affect SAP’s future financial results are discussed more fully
in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”),
including SAP’s most recent Annual Report on Form 20-F filed with the SEC.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates.

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 2


Opportunity
in Time of Disruption
Bill McDermott, CEO

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 3


SAP: “Structural Incline”

Doubled Addressable Be the most innovative cloud company powered by SAP HANA Intelligent Enterprise
Market

Public Cloud
SAP Business Suite
powered by SAP HANA

SAP Analytics Cloud


• Integrated Intelligent Suite
SAP HANA Enterprise Cloud
• Revolutionizing Customer
Launched
Experience with C/4HANA
€5.0bn
• Leading the Experience
€3.8bn Management category
Sybase €3.0bn Cloud
€2.3bn Revenue • Innovation with Intelligent
€1.1bn Systems (Leonardo)
€0.3bn
€ 0.0bn €0.0bn €0.8bn

UNTIL 2010 2011 2012 2013 2014 2015 2016 2017 2018

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 4


All figures based on non-IFRS.
The fastest growing cloud at scale in business software

Cloud Peer Group Large Scale Peer Group


40% 15%
Cloud Fastest Growing
Cloud
Growing faster
than large scale
Top line peer group
Top line
Growth Growth
Highly profitable
(~30% Op.
Margin)

10%
0%
$1 B $15 B 10% 50%
Cloud Revenue Operating Margin

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC Sources: Company filings, Factset, Morgan Stanley, Deutsche Bank, Credit Suisse estimates 5
Driving sustainable operating profit growth
Hyperscaler
leverage Higher margin
Services
Hiring discipline

Ecosystem

Increased Cloud
Gross Margin
Keeping the
“Meet or
Exceed”
Promise

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 6


Winning the experience economy

X 1.8B
EXPERIENCE MANAGEMENT

experience
DATA
experience
CX EX PX BX touchpoints run
Customer Employee Product Brand on Qualtrics
Experience Experience Experience Experience

DATA MANAGEMENT
Cloud Platform | Data Management | AI

Customer
Experience
Supply Chain
Management
ERP HCM Spend
Management
77%
O
Of the world‘s
transactions across
25 industries touch
operational SAP systems
DATA
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 7
The SAP “Top Ten”

Winning Strategy 2023 Growth Ambition

1. X+O: Experience Management (X) 6. #1 in Experience Management


Meets Intelligent Enterprise (O)
7. Fastest Growing in Customer
2. Next Gen CRM: C/4+S/4 End-to-End Experience

3. Industry 4.0: Next-Gen Manufacturing 8. #1 in Cloud ERP


and Supply Chain
9. #1 in Cloud Workforce Management
4. Automation and Augmented Humanity:
SAP Leonardo Everywhere 10. Global Standard in Business Networks:
Trillions in Commerce
5. New Skills, Flexible Workforce: SAP
SuccessFactors + SAP Fieldglass

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC Based on financial analyst commentary following disclosure of SAP’s Q4 2018 results 8
DELIVER the
Intelligent Enterprise
Christian Klein (COO) and Juergen Mueller (CTO)
Executive Board Members

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 9


The Intelligent Enterprise by SAP – ONE Seamless Customer Experience

SEAMLESS CUSTOMER EXPERIENCE

Marketing Sales Services Design Plan Manufacture Deliver Operate

Employee Network &


Engagement Finance
Spend Management

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 10


The Intelligent Enterprise by SAP – ONE Seamless Customer Experience

SEAMLESS CUSTOMER EXPERIENCE

Customer
Experience Services Design Plan Manufacturing
Manufacture Deliver Operate
Marketing Sales
& Supply Chain

Employee
Engagement Digital Core
Finance Network & Spend
Management

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 11


Intelligent Business Processes With SAP Leonardo

Customer Manufacturing &


Experience Supply Chain

Employee Digital Core Network & Spend


Engagement Management

Machine Internet
Big Data Blockchain
Learning of Things
SAP Leonardo

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 12


We Empower Decision Makers with End-to-End Real Time Steering

% % % % % % % % %

Real time steering across the value chain


Reporting | Predictive Analytics | Integrated Planning

Customer Manufacturing &


Experience Supply Chain

Employee Digital Core Network & Spend


Engagement Management

SAP Cloud Platform powered by HANA

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 13


The Intelligent Enterprise

Digital Core

Employee Network & Spend


Engagement Management

Intelligent Suite

Customer Intelligent Technologies Manufacturing &


Experience Supply Chain

SAP Leonardo

Digital Platform

Data Management Cloud Platform


© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 14
Adoption of SAP S/4HANA is kicking in by offering unique potential across
all Lines of Business.

SAP S/4HANA Adoption 10,500+


# of licensed customers Licensed customers

10,500+
Ahead of R/3
Adoption

40%
Net new customer share

132
Accelerated
Cloud Growth
in Finance and Professional Services
2015 2016 2017 2018 2019
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 15
The Intelligent Enterprise

Digital Core

Manufacturing & Employee


Supply Chain Engagement

Intelligent Suite
Network & Spend
Customer
Management
Experience Intelligent Technologies

SAP Leonardo

Digital Platform

Data Management Cloud Platform


© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 16
SAP C/4HANA
Shaking up CRM
Alex Atzberger, President SAP Customer Experience
@aatzberger

#BeBold

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 17


We live in a
Experience Economy
80 %
of customers have chosen
$2.5T
Impact of yearly loss of trust due
$100B
Estimated market size for customer
to switch brands due to a to abuse of data privacy and experience solutions, platform and
poor customer experience1 brand loyalty2 integration to operational systems3

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 1 Bain 2 Adweek 3 SAP CMI Model 18
CRM has evolved into Customer Experience management platforms

Legacy CRM CX Suites

Transactional data Operational + Experience data

Siloed view and processes with Seamless end-to-end journeys designed


focus on sales force automation around customer across all channels

Customer privacy not in scope Privacy built-in

Monolithic platforms Microservices-driven agile platform

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 19


SAP
Marketing Service
Cloud C/4HANA Cloud
2.8 Billion 5 Clouds and 7 Suite Attributes 61 million
personalizations Service Tickets

Commerce Sales
Cloud Cloud

5-year Gartner MQ Leader 5+ million


Sales Professionals

Customer Data Cloud


1 Billion+ consent profiles

Harmonized End-to-End Business and Master Suite Intelligence Platform Extensibility Open Ecosystem
User Experience Processes Data Services and Analytics Services and Integration

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 20


Best-of-Breed: Recognized product leadership

Gartner Front Runners for Forrester Wave for B2C Forrester Wave for B2B Forrester Wave for Gartner Magic Quadrant for
Field Services Commerce Suites Commerce Suites Customer Identity Mgmt Multichannel Marketing

IDC MarketScape AI in Gartner Magic Quadrant for Forrester Wave for IDC MarketScape Leader Gartner Magic Quadrant for
Enterprise Marketing Clouds Configure, Price, Quote Configure, Price, Quote Subscription Relationship Sales Performance
Management Management
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 21
Best-of-Suite: Most complete portfolio

Sales Service Marketing Commerce Customer Collaboration Cloud Integration Industries Open Data X Data &
Data Platform Initiative O Data

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 22


Market Leadership: SAP is LEADING Customer Experience

Digital Commerce1 #1 #3 #4
CRM1 #2 #1 #3
Experience Management2 #1 n/a n/a
Source:
(1) Gartner Enterprise Application Market Share Q12018, May 2018
(2) Qualtrics S1 filing

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 23


Momentum is gaining… … Opportunity is vast

▪ Cloud Growth 170% YoY


Q4

▪ 10,000+ customers use either one


or multiple C/4HANA solutions
Q3
▪ 10M+ users from sales, service to
marketing professions

▪ Close to 4,000 SAP CRM


Q2
customers remain On-premise
today

▪ Largest addressable enterprise app


Q1
market, least penetrated market by
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC SAP 24
The SAP Advantage
Experience Trust Integration

SAP C/4HANA + Qualtrics SAP C/4HANA provides a SAP C/4HANA + S/4HANA


allow customers to put the single view of the customer are an integrated suite
customer at the center of based on consent-driven resulting in lower integration
their business and engage customer data costs and smarter end-to-
across all channels with the end processes that connect
customer demand chain to the
company’s operational core
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 25
Lorenz Gan - CIO New Era
Customer Perspective
Hosted by Jennifer Morgan
President, Global Customer Operations Americas and Asia Pacific Japan
Executive Board Member

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 27


Alex Chatkewitz Sara Baxter Orr
Chief Accounting Officer CFO Verizon Wireline
and Controller

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 28


Charting the Course
for 2023
Luka Mucic, CFO and Executive Board Member

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 29


We’ve Come a Long Way
Doubled Addressable Be the most innovative cloud company powered by SAP HANA Intelligent Enterprise
Market

Public Cloud
SAP Business Suite
powered by SAP HANA

SAP Analytics Cloud • Integrated Intelligent Suite


SAP HANA Enterprise Cloud • Revolutionizing Customer
Launched
Experience with SAP
€5.0bn C/4HANA
• Leading the Experience
€3.8bn
Management category
Sybase €3.0bn Cloud
€2.3bn Revenue • Innovation with Intelligent
€1.1bn
€0.3bn Systems (SAP Leonardo)
€ 0.0bn €0.0bn €0.8bn

UNTIL 2010 2011 2012 2013 2014 2015 2016 2017 2018

Software &
Service
Service
Cloud
Approaching
Service

2007
€10bn
Support
Software 2018
€25bn
80% 2023
More
Predictable
>€35bn
37%
Software More
Predictable
65% Support
More
Predictable
© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 30
All figures based on non-IFRS. Amounts in doughnut charts represent total revenue.
2023 figures based on SAP’s 2023 ambition
Staying our Course, Keeping our Promises

2015 2016 2017 2018


€1.95 – 2.05bn €2.95 – 3.05bn €3.8 – 4.0bn €4.95 – 5.15bn Outlook (€bn)
Cloud Revenue €2.0bn €3.0bn €3.8bn €5.2bn Actual (€bn)

Cloud & Software +8% – 10% +6% – 8% +6% – 8% +6.5% – 8.5%


Revenue (growth) +12% +8% +8% +10%

€23.2 – 23.6bn €24.8 – 25.3bn


Total Revenue
€23.8bn €26.0bn

Operating Profit €5.6 – 5.9bn €6.4 – 6.7bn €6.8 – 7.0bn €7.35 – 7.50bn

€5.9bn €6.6bn €6.9bn €7.5bn

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC All figures based on non-IFRS, at constant currencies. Outlooks as provided in January of corresponding year, except 2018 (outlook as of April to reflect Callidus acquisition) 31
Increasing Our Ambition

2020 Ambition 2020 Ambition


as of January 2015 as of January 2019

▪ Cloud Revenue ▪ Cloud Revenue


in a range of €7.5 – 8.0bn + €1.1bn in a range of €8.6 – 9.1bn

▪ Total Revenue ▪ Total Revenue


in a range of €26.0 – 28.0bn + €1.9bn in a range of €28.6 – 29.2bn

▪ Operating Profit ▪ Operating Profit


in a range of €8.0 – 9.0bn + €0.3bn in a range of €8.5 – 9.0bn

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC All figures based on Non-IFRS. Ambition increases based on intervals’ midpoints. 32
Cash Matters
Restructuring
DSO upside potential
5.0bn

Operating Cash
Flow
€ 4.6bn
4.3bn
€ SBC payouts (Qualtrics)
Restructuring
SBC payouts
Tax
Key incremental Tax
effects on cash flow: Interest (Qualtrics)
Insurance Payments
DSO upside potential
Currency
IFRS 16 (re-classification)

2016 2017 2018 2019e 2020e

Includes:
Stock-based 1.0bn

compensation 0.8bn

payouts € 0.6bn

2016 2017 2018 2019e 2020e


© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 33
SBC = stock-based compensation
Flat Capital Expenditure, Adjusted Free Cash Flow Definition

2019 Adoption of IFRS 16 (Leases) Capital Expenditure and Free Cash Flow

€5.0bn
Balance Sheet Expansion €4.6bn
€1.7 – 1.9bn Operating €4.3bn
Cash Flow

Operating Profit Increase 2016 2017 2018 2019e


Significantly Below €0.1bn
€1.5bn €1.5bn
€1.3bn
Capital
€1.0bn
Expenditure
Operating Cash Flow Increase
€0.3 – 0.4bn
2016 2017 2018 2019e

€3.6bn €3.8bn
Free Cash Flow Unaffected Free €2.8bn
Adjusted SAP Definition previous definition
Cash Flow
adjusted definition

2016 2017 2018 2019e


© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC IFRS 16 balance sheet impact based on 2019 opening balance sheet. IFRS16 operating profit impact assumes 2019 leasing volumes comparable to 2018. 34
Capital expenditure defined as cash flow from purchases of intangibles and property, plant and equipment.
Charting the Course for 2019 and 2020

Cloud Revenue Total Revenue Operating Profit


(€bn) (€bn) (€bn)
+8 to +9%
CAGR
€28.6 – 29.2bn

€24.7bn
+29% +11.5%

+7.5 to
+33 to
+11.5% €8.5 – 9.0bn
+39% €8.6 – 9.1bn

€6.7 – 7.0bn €7.7 – 8.0bn

€7.2bn
€5.0bn

2018 2019 2020 2018 2019 2020 2018 2019 2020

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC All figures based on Non-IFRS. 2019/2018 growth rates at constant currencies. 2020/2019 growth rates based on midpoints of 2019 outlook and 2020 ambition. 35
2023
Building the Cloud Suite – Achieving Scale >3x vs. 2018

2019
€6.9bn
2018
€5.0bn

2015
€2.3bn
Cloud
2011 Revenue
~€20m

Ramping Approaching Scale Fully Scaled


▪ SAP Analytics Cloud ▪ Manufacturing & ▪ SAP C/4HANA ▪ SAP SuccessFactors
Supply Chain
▪ SAP Cloud Platform ▪ Qualtrics ▪ SAP Concur
▪ SAP S/4HANA Cloud
▪ SAP Fieldglass ▪ HANA Enterprise Cloud ▪ SAP Ariba

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 36


All figures based on Non-IFRS. 2019 based on midpoint of cloud revenue outlook. 2023 based on SAP’s 2023 ambition.
Expanding Gross Margins for Every Cloud Model

30-35%
IaaS
HANA Enterprise Cloud
Gross Margin

13% (+6pp)
IaaS

2020
€8.9bn
2018 Gross Margin
71%
€5.0bn 60% (+3pp) 70%
63% SaaS/PaaS SaaS/PaaS
SAP SuccessFactors
Gross Margin Qualtrics
78% (+1pp) >80% SAP C/4HANA
SAP S/4HANA Cloud
Business Networks Business Networks SAP Cloud Platform
SAP Concur Dig. Supply Chain
SAP Ariba SAP Analytics Cloud
SAP Fieldglass …

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC All figures based on non-IFRS. Amounts in doughnut charts represent cloud revenue, percentages represent overall cloud gross margins. 37
Percentage points reflect year-over-year expansion. 2020 figures based on SAP’s 2020 ambition
Expanding Gross Margins, Decreasing Expense Ratios

Gross Margins Expense Ratios

Non-IFRS; in percent 2017 2018 2020e Non-IFRS; expenses as a percentage of total revenue 2018 2020e

Business Network 76.7 77.8 >80 Research and Development 13.8


Private Cloud (IaaS) 7.2 13.0 30-35
Sales and Marketing 25.0
Public Cloud (PaaS/SaaS) 56.7 59.9 70

Cloud 62.2 63.1 71 General and Administration 4.0

Software & Support 87.0 87.4

Cloud & Software 82.2 81.5

Services 23.5 22.9

Total Gross Margin 72.5 71.8

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 38


2020 figures based on SAP’s 2020 ambition
Charting the Course for 2023 – Our Financial Ambition

Cloud Revenue Total Revenue

> 3x > €35bn


vs. 2018

More Predictable Revenue Operating Profit

approaching 80% 7.5 – 10%


5-year CAGR

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC 39


Why SAP?

What we think What you think

▪ The integrated, intelligent suite always wins ▪ “SAP grew cloud subscription at a rate faster than
their main competitors in FY’18”
▪ Only SAP enables companies to build a reliable,
future-proof IT platform for their mission-critical ▪ “SAP offers a good combination of defensive growth,
operations given its exposure to digital transformation and its
high share of recurring revenue”
▪ SAP is end-to-end – on premise, hybrid and cloud
▪ “SAP S/4HANA is SAP’s most significant innovation
▪ Together with Qualtrics, SAP will become the in the core for 20 years”
undisputed leader in the Experience Management
category ▪ “With their broad innovative and competitive portfolio
SAP delivers rapid growth quarter by quarter“
▪ SAP has a resilient, predictable and sustainable
business model ▪ “SAP Leonardo, which helps companies to
orchestrate disruptive capabilities, could be the start
▪ SAP has a strong focus on sustainability of another powerful product cycle”

© 2019 SAP SE or an SAP affiliate company. All rights reserved. ǀ PUBLIC Based on financial analyst commentary following disclosure of SAP’s Q4 2018 results 40