HELIX – Delivering on our commitments

Today at Software AG we announced our Q3 2019 financial results. Thanks to the hard work of our entire team, we reported solid numbers this morning alongside encouraging lead indicators that show me we’re on the right path as a company.

We’re now eight months into our Helix transformation journey, and we’re starting to see positive changes we’ve made in our transformation pillars – Focus, Execution, and Team – making their impact. 

Transformations like Helix take time and energy. The true value in them only starts to show through when commitments made become commitments delivered. In Q3, we have started to deliver against our initial Helix commitments – and the early benefits to that delivery is showing through.

We made a commitment to improve the quality of our earnings. ARR within our DBP segment, including our IoT business, is 12 percent higher today than it was one year ago. Our SaaS and subscription sales now account for 63 percent of bookings from within that same business, that’s more than DOUBLE last year.

We also committed to enhance our product strengths and to focus only on R&D in areas that will drive growth. Our development velocity has continued to gather momentum and we have brought two new products to market in recent weeks – webMethods.io B2B and ARIS Cloud. We are delivering innovation now to customers every quarter, thanks to sector-beating cloud offerings across all our major product areas and a product Net Promoter Score at an all-time high.

We committed to execute in the market with greater precision and consistency, and that’s evident in the pace at which we’re winning in the market – We secured 83 new logos in Q3, with 17 of these new logos choosing us in IoT. EY, Dubai Smart City Government, the US Navy – these and many other major organisations have placed their trust in us. We’re winning against the competition and more crisply converting our pipeline, thanks in no small part to much sharper sales discipline and execution.  

We also committed to broaden and deepen our partner ecosystem, and to keep on investing in the Team inside and outside of Software AG. We’re building an extended team that cares about partnership and shared potential. Our OEM agreement announced today with Adobe Company, Marketo is another solid proof point that we have those qualities. We continue to invest significant energy in evolving our existing partner relationships with Microsoft, AWS, ADAMOS, MindSphere and Deutsche Telekom.

I’m particularly proud of the work done during Q3 in our North American business. In the earlier part of the year, we faced some issues in our North America business. We were honest about the fact we simply weren’t executing sharply enough. But now, that’s changing. Thanks to the work of CRO John Schweitzer and our North America team, we’re claiming new ground in key areas of the marketplace – particularly Hybrid Integration – which we have every right to own.

These positive changes have been delivered by a team displaying real energy and an appetite for success. This isn’t just about one or two people. It’s about a whole cultural shift that’s taking root and will give this business the foundation it needs to grow in the future. With that in mind, during Q3 we have continued to invest in our people and their skills, which they have embraced, alongside appointing Elke Frank as our first ever CHRO. Elke is already proving to be a great steward of our Software AG culture.

I think these results, and the efforts behind them, represent a real turning point in our transformation.

Eight months since we started it, our Helix transformation is now proving its potential. Helix is the right strategy for Software AG – and the sustainable, profitable growth future we’re targeting remains firmly in sight.

Sanjay.