As U.K. accounting company Sage continues to bolster its cloud-based offerings, the company is looking to offload its offline products to remain competitive, according to reports.
The Sunday Times reported Sunday (Sept. 1) that the company “is trying to wean itself off” of relying on offline accounting services as the cloud continues to disrupt the corporate and small business accounting market. Though Sage is now one of the U.K.’s largest publicly listed firms, “the rise of cloud computing … is threatening its existence,” the publication stated.
News first emerged earlier this year of Sage’s efforts to unload assets as it focused on the cloud. In January, Reuters reported Sage’s $100 million divestiture of its payroll outsourcing unit, selling it to human resources management company iSolved HCM.
Months prior, Sage CEO Steve Hare discussed the company’s cloud focus in an earnings call, noting that the company’s cloud migration could slow down its growth in the short-term.
“Cloud and emerging technologies are moving quickly, and we need to invest to make sure we can stay ahead in terms of what we can offer our customers,” he said in November. At the time, the company revealed a $77 million investment plan into its cloud migration and Software-as-a-Service subscription offerings.
According to The Times, Sage’s cloud and SaaS efforts have yet to pay off: Shares in the company have declined 14 percent since July when the company issued an investor update revealing a 15.5 percent drop in software sales in the nine months to June. However, the company did post that software subscriptions were up 28 percent, reports noted, pointing to industry rivals like Intuit QuickBooks and Xero, who have been outperforming Sage as of late.
Beyond the U.K., Sage announced on Friday (Aug. 30) that its financial management platform Sage Intacct has launched in Australia, a part of the Sage Business Cloud suite of offerings. The rollout was joined by new research from Sage revealing a shift in the role of chief financial officer, the company said.