(Corrects spelling of country in third paragraph.)
Dec. 6 (Bloomberg) -- SAP AG, the biggest maker of business-management software, plans to step up cooperation with Samsung Group to overcome a slump in Asia and speed its transition to cloud computing.
“Cloud is one of the future trends that we are trying to bring into Korea,” co-Chief Executive Officer Jim Hagemann Snabe said in an interview in Seoul today. “Samsung plays an important role in making sure that their handsets are optimized for SAP software.”
The Walldorf, Germany-based software giant is also in talks with local Samsung rival LG Electronics Inc. and mobile operators including SK Telecom Co. and KT Corp. to speed the adoption of its next-generation Hana database technology and cloud service in South Korea.
SAP’s partnership expansion in Asia in areas such as cloud- based programs will help offset slowing demand for its older enterprise applications and counter intensifying market competition. It announced a strategic alliance with China Telecom Corp. in November, in which SAP will expand its cloud portfolio in the world’s second-largest economy.
The company’s third-quarter operating profit adjusted for some items rose 5 percent to 1.3 billion euros ($1.8 billion), also helped by lower costs, it said on Oct. 21. Revenue from cloud subscriptions more than doubled to 197 million euros, amounting to about a sixth of software sales for the period.
Still, SAP software sales dropped 9 percent for the Asia- Pacific region, and 13 percent in the Americas in the quarter.
SAP also entered a long-term partnership with Samsung Electronics Co., Samsung Group’s flagship electronics unit, in October. Under the agreement, SAP provides its mobile security and management solutions to the Suwon, South Korea-based company’s security system for enterprises, called KNOX. That helps address company concerns over Android-powered devices amid increasing demand for smartphones.
SAP also expects to benefit from the increasing demand for wearable devices, including sportswear or accessories.
“There will be a revolution of connectivity and the opportunities to individualize service and reduce costs and systems is very significant,” Snabe said.
Snabe will step down in May, leaving his co-CEO, Bill McDermott, as SAP’s sole chief executive.
--Editors: Heather Smith, Tom Lavell