FRANKFURT, Germany - Shares of SAP AG plunged yesterday after the business-software-maker said it saw a sudden drop in business at the end of September as global financial turmoil escalated.
"The market developments of the past several weeks have been dramatic and worrying to many businesses," Henning Kagermann, the co-chief executive of the company, said in a statement.
The company's headquarters for the Americas is in Newtown Square, Pa.
"These concerns triggered a very sudden and unexpected drop in business activity at the end of the quarter," he added. "Unfortunately, SAP was not immune from the economic and financial crisis that has enveloped the markets in the second half of September, causing us to report numbers below our expectations."
SAP said it expected software and software-related service revenue for the July-to-September period to come in between 1.97 billion and 1.98 billion euros, or $2.66 billion to $2.67 billion. That is up about 13 percent from the third quarter of 2007, but SAP said in July that it expected the figure to increase between 24 percent and 27 percent for the year.
SAP made its announcement after its shares closed down more than 16 percent in a broadly lower Frankfurt market. SAP's U.S. shares closed down $5.82, or 12.75 percent, at $39.83.
The company is due to report its full results for the quarter Oct. 28.
Shares of SAP's biggest rival, Oracle Corp., were unchanged yesterday at $18.30.