Most likely Luka's departure has to do with Stock performance ( this is usually where the ax falls when it comes to financial performance). Even though Cloud revenues have risen from 1B to 9B during Luka's tenure as CFO, the stock has not reflected this growth. As of today SAP stock is down -20% YOY which is pathetically poor especially when compared to other companies. Take ServiceNow where Bill M. went - during the same time period, stock is up +20%.
The issue for SAP is not so much the revenue but the costs/expenses. All of the Cloud revenue SAP has is coming from acquisitions and not from SAP internal/organic development. . Moreover, SAP paid very high M&A costs for companies like Success Factors, Concur and especially Qualtrics, not in any one of all the acquisitions that SAP made, and there have been many, was there ever any effort made to consolidate/reduce the headcount coming into SAP. In each one, 100% of the M&A employee base was absorbed into SAP resulting in a skyrocketing personnel count/cost, .perhaps > 35 % of the total 100,000 employees have come from acquisitions. The duplication/overlap of roles is incredible, moreover each of these acquisitions still functions like an independent entity, further minimizing any leverage opportunity..
Clear that SAP wants to shift quickly and entirely to the Cloud and for this strategy, the huge development teams in all of the Labs locations and Walldorf as well as the entire corporate structure are dinosaurs and unnecessary for Cloud market share.. Unlike the massive ERP platforms of yesterday, entry into the Cloud business is low cost and easy entry and the business is highly competitive and more so given that you only get a one year subscription commitment from a customer and then you have to reacquire the same customer over and over again. There is no space for companies with significant overhead that was needed for former times and while Elliott forced some reductions on the upper management people in 2018, nothing company wide has been undertaken to reduce headcount by 10 or 15% by SAP Board which is going to be needed for realistic stock price increase.
The market was getting impatient year after year with the dismal stock performance and Hasso was under pressure to react - otherwise at this point he might be the one out. Individually he and Ditmar only retain about 6 % of outstanding stock (combined they have only about 12%), The investment houses are not going to be left holding the bag or continue to wait for illusive improvement and they also took a lesson from Elliott on what means to be an "activist investor" and they gave their ultimatum on what and when they expect to see on performance or they drop SAP off their portfolios or they seek changes at Chairman level, which may happen in any case given Hasso's age It didn't help either that it was just disclosed in last 48 hours that SAP kept secret that it was Hasso's charity organization which was the major investor in the spinout of SAP's very profitable financial. services division - why was it important to mislead the investors about this? Therefore Luka may very well have been the sacrificial lamb. Unfortunately a new CFO will only be the beginning of changes at SAP. He/she will have a clear mandate - stock price must increase significantly to make up for lost years and satisfy the investor community.. Look for big reductions in operating margin factors, which translates into employee reductions. More unfortunately these reductions seldom happen in the high cost/high perk area of Germany ( they are well protected) and most likely will occur in the US to get the biggest cost reductions on a 1:1 Headcount basis vs other geographies.
So if you are an employee of SAP It could very well be a not so good sign of things to come - investors on the other hand may rejoice at what could be coming.