SAP Plunges Most Since 2011 After Report on Pipeline

SAP SE fell the most in almost three years in Frankfurt after Boerse Online reported that the company’s pipeline for the fourth quarter is missing expectations, citing an unidentified source.

The company is increasing revenue and is controlling costs with measures including restrictions on recruitment and travel, the world’s biggest maker of business-management software said in a statement today.

“The CFO has ordered a hiring freeze until end of 2014 and reminds SAP employees to keep up the ‘cost discipline’ as the company has exceeded its budget after nine months,” Thomas Becker, an analyst at Commerzbank, said in a note today. “These kind of ‘orders’ are not new at SAP and are typically used to meet” full-year earnings guidance “when top-line growth becomes more challenging.”

SAP dropped as much as 5.6 percent, the biggest intraday decline since December 2011. The shares were down 4.5 percent at 53.43 euros as of 12:07 p.m., taking the fall to 14 percent this year and giving the Walldorf, Germany-based company a market value of 65.7 billion euros ($83 billion).

For the third quarter, SAP may report software license sales, an indicator of future income, of 971.7 million euros, according to the average of six analyst estimates compiled by Bloomberg. That compares with sales of 975 million euros a year earlier.

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