Fourth-quarter operating profit, excluding special items, for the German software maker rose 4 percent to 2.37 billion euros (2.03 billion pounds), as growth in its German businesses offset its currency-hit U.S. business, the company said in a statement.

These results were on the light side of estimates ranging from 2.28-2.60 billion euros, according to a Reuters poll of 21 analysts. SAP Finance Chief Luka Mucic indicated last month the company would meet 2016 targets.

Marking progress moving its customer base to newer cloud-based internet platforms from classic packaged software products it has sold for decades, SAP said new cloud bookings jumped 40 percent in the quarter and backlog for unbilled cloud services rose 47 percent to 5.4 billion euros at year-end.

The software maker, whose customers include many of the world's biggest multinational companies, specialises in applications used in business planning, ranging from accounting to human resources to supply-chain management.

SAP has made strides in recent years relative to entrenched rivals such as Oracle in moving its customer base to newer cloud-based internet platforms from classic packaged software products it has sold for decades.

Its move to sell software as internet services rather than in packages has also helped SAP fend off newer cloud rivals like Salesforce.com and Workday Inc.

Still, SAP's classical software licence and support business held up well during the final period of 2016, its most important quarter of the year when the lion's share of licences are up for renewal in that period.

SAP said it expects revenue for 2017 of 23.2 billion to 23.6 billion euros, a modest rise from the 23.0 billion to 23.5 billion euros it forecast a year ago for the current year and an increase of 6 percent over 2016, based on the midpoint of the guidance.

These forecasts were shy of the mean 2017 revenue estimate of 23.65 billion euros, based on a Reuters poll of 20 analysts.

It said it expected 2017 operating profit of 6.8 billion to 7.0 billion euros in constant currencies, tightening its prior estimate of 6.7 billion to 7.0 billion euros. This would represent roughly a 4 percent rise over 2016.

"Our strong backlog paired with our robust pipeline position us for yet another year of profitable growth in 2017," Mucic said in a statement, adding that these factors allowed the company to confidently raise its financial ambitions for 2020.

SAP raised its 2020 total revenue outlook to between 28 billion and 29 billion euros, up from a range of 26 billion to 28 billion previously, while looking for operating profit at the high end of its prior outlook.

The company said that about three quarters of its business would come from long-term contracts in 2020. At the end of 2016 this so-called predictable business stood at 61 percent.

Shares in SAP were up 0.8 percent at the top of Germany's blue-chip DAX index in pre-market trade at brokerage Lang & Schwarz.

(Editing by Maria Sheahan and Stephen Coates)

By Harro Ten Wolde and Eric Auchard

Stocks treated in this article : SAP SE, Oracle Corporation