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Microsoft wants to make software performance simpler for IT departments to manage, and it plans updates to two key systems-management products next year and in 2007 that include new technology for monitoring the health of applications.

SAP increases Q1 profit on strong U.S. sales

German business software vendor SAP AG today reported an 11% increase in first-quarter net income on strong sales, particularly in the U.S.

Net income rose to $331 million, or $1.07 per share, in the quarter that ended March 31. That's up from $299 million, or 96 cents per share, in the same period a year earlier, the company said in a statement.

Software revenue in the first quarter was up 17%, to $567 million, from $484 million a year earlier. At constant currency rates, revenue increased 20% year-on-year. Constant currency rates exclude the impact of fluctuations in currency exchange rates.

In the U.S. -- one of SAP's fastest-growing regions as the company moves to win business from its closest competitor, Oracle Corp. -- sales increased 27%, to $171 million, up from $134 million. At constant currency rates, U.S. revenue was up 35% year-on-year.

SAP's Safe Passage maintenance and migration program is aimed at all companies in the U.S. running PeopleSoft and J.D. Edwards applications. PeopleSoft Inc., which acquired J.D. Edwards & Co. in 2003, was later purchased by Oracle for $10.3 billion.

Revenue in the Europe, Middle East and Africa region grew 6%, to $1.2 billion, up from $1.13 billion a year earlier. However, revenue in Germany, SAP's home base, was down 2% in the quarter, as Europe's largest economy continues to battle high unemployment and sluggish consumption.

SAP's flagship ERP software continued to account for the lion's share of software revenue. The product generated revenue of $227 million in the first quarter, up 12% from $204 million a year ago.

The next-largest revenue generator was the company's supply chain management software, which came in at $115 million, up 9% from $106 million a year earlier.

SAP expects full-year 2005 revenue to increase between 10% and 12% compared with 2004's, the company said.

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