And then you look at the decline in the ERS business by minus 60% constant currency like next year. If you do the math and simply take the same growth rates on all these categories for the next 2 years, you come exactly to our Ambition 2025. So it’s not an acceleration. It is simply a continuation of the momentum in these different buckets, i.e., spots in our Cloud ERP suite, a slightly lower growth or lower growth, frankly, on the extension suite, which Christian mentioned and then a declining as business. On top of that, of course, we have a minor – very minor uptick from the Litmos – sorry, the LeanIX integration. So we can really nicely triangulate from that. The revenue growth we’ve guided for ‘24. So in addition to jumping off current backlog, you asked about the transactional part of it, you can figure out that I mean we said it’s about €800 million of revenues it’s kind of flattish in 2024.
If you look at the dilution of the CCB by that, it brings you pretty much to our midpoint of the guidance, so it’s all extremely circular triangulation 2024 Cloud revenues.
Christian Klein: Yes. And maybe just one comment. I mean because there was also a question around large enterprises moving to RISE. I mean, what we typically see is the customers, especially large enterprise customers. They land with finance and logistics. And then we already embed procurement because now because of the integration everything sitting on BTP, there is no need anymore to buy direct procurement on for S/4 and indirect procurement with Ariba. It just comes as one procurement platform, which also then avoids that we are going into insights against any best-of-breed players. We are just delivering it out of the box. And then when you land it, then you can talk about, let’s modernize travel and expense. And when you actually have finance and logistics, why do not predict the sales planning and inventory matching with IBP? And this goes on and on and on. And this, of course – this cross-sell synergies, we want to leverage now in the years to come.
Johannes Schaller: Very clear. Thank you.
Anthony Coletta: Thank you, Johannes. We will take the next question, please.
Operator: The next question is from the line of Adam Wood with Morgan Stanley. Please go ahead.
Adam Wood: Hi, good morning. Congratulations on a strong end to ‘23. Thanks for taking the question. Maybe just first of all, in terms of the restructuring plan, you’ve obviously given guidance for ‘25. Could you just help us there are any further benefits that you’d expect that plan, both on revenue acceleration and cost-RISE post 2025? And then secondly, as we talk about Business AI and SAP, obviously, investors have been assessing a lot the benefits of the chip layer, the hyperscalers and for large language models, but it strikes us that there’s going to be a big benefit for companies that are excess to customer data and customer processes. Could you just a little bit about how that differentiates SAP and how willing customers are to work with you to share those things to benefit the wider installed base? Thank you.
Christian Klein: Look, I can start, and then Dominik, please also comment on our cost potential 2025 and beyond. I mean, look, the business model Adam, I mean, when we started this transformation 3 years ago, was, of course, a much lower recurring revenue show. And now we have built immense resilience, and the total cloud backlog of €44 billion actually signals the immense revenue potential we already have in the books for the years to come. We will now doubling down on landing, expanding on adoption to really drive that home. And then just to give you another figure, RISE, GROW – RISE is actually contributed with 50% net new customers. So 50% installed base, 50% net new. So it’s not only about converting the installed base, the support revenue with a higher multiple to cloud, it’s also about winning market share.
And then when you look into 2025 and beyond, and Dominik can comment on that, I mean, given now the higher recurring revenue share, given the lower share of license revenue, which will further decline in the years to come. Obviously, it’s actually just as a result that we see further total revenue acceleration also 2025 and beyond. And with Business AI and sustainability and in our very strong supply chain portfolio, we have no lack of new solutions of new innovations to further also win market share in the upcoming years.
Dominik Asam: And maybe then beyond the acceleration on total revenues because of the mix effects that are playing in our favor, yes, the restructuring program, which is frankly, expensive at €2 billion has benefits beyond the pure kind of uplift of €0.5 billion in 2025. I mean there’s also the reskilling that we need to do to master business design and drive the growth. But also from a pure financial model point of view, what we’ve really tried to do is to decouple the cost growth more on the top line growth. I mean, that was a little bit the achilles heel, I would say, in our business model. that we have been not very successful to do that in the past. And that was also – I think there’s a good reason for to invest heavily in the transformation.
But now our customers want to see and you investors that we can drive efficiencies by Business AI. We’ve done some thorough benchmarking with other cloud companies are doing, and we really want to converge more to best-in-breed kind of fall through, i.e., operating leverage, i.e., increasing the cost base more slowly should give us actually margin expansion beyond 2025.
Christian Klein: And Adam, on AI and differentiation for SAP, just to give you a glimpse, we are developing strong organic product, a strong organic AI platform so that our copilot tool can speak not only finance, but can solve some of the hardest problems our customers facing across the company. We are going to infuse it right into the business processes. I mean when you look at what we already can do in particular sales and optimizing inventory, it can take out a ton of CapEx and OpEx of the P&L or balance sheet of our customers. And then when you listen to our partners like Microsoft or NVIDIA, where we just closed another partnership, I mean they are keen actually now to combine their copilot with our copilot to extend our AI platform, why, because when you have content from over 30,000 customers and access to the most mission-critical data, I mean the algorithms become smarter every day.
We can actually solve some problems, which are of count [ph] the accuracy, and also actually to also ensure responsible AI is of course a treasure, but only SAP has in the market.
