Europe’s largest software company, SAP (SAPG.DE), warned late on Friday that first-quarter results would be weaker than expected due to slower sales of software licenses to corporate customers in the United States, its biggest market.

Software license revenues fell 13 percent while the company’s newer, but lower-margin cloud software business grew 33 percent. Business customers are shifting to cloud-based software delivered over the Internet instead of relying on older software packages they install and run on in-house computers.

First-quarter operating profit, excluding special items, rose 5 percent to 1.10 billion euros ($1.25 billion).

Analysts, on average, had been looking for a first-quarter operating profit, excluding special items, of 1.15 billion euros, with 12 estimates ranging from 1.09 billion to 1.25 billion euros, according to Thomson Reuters I/B/E/S data.

(Reporting by Eric Auchard, Harro ten Wolde and Ilona Wissenbach; Editing by James Dalgleish)

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