Christian Klein, CEO of SAP Software Group, during the annual press conference. Europe's largest software maker SAP today announces its numbers for the past financial year.
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Europe should avoid regulating artificial intelligence and focus its attention on the outcomes of the technology instead, CEO of German tech giant Sub He told CNBC on Tuesday.
Christian Klein, who has held the top position at SAP since April 2020, said Europe risks falling behind the United States and China if it over-regulates the AI sector.
While it is important to mitigate the risks associated with AI, Klein argues that regulating the technology while it is still in its infancy would be misguided.
“It's very important that we know how we train our algorithms, and the AI use cases that we integrate into our clients' businesses — they need to deliver the right outcome for employees and society,” Klein said on CNBC's “Squawk Box Europe” on Tuesday. .
“If you only regulate technology in Europe, how can our startups here in Europe, how can they compete against other startups in China, Asia and the United States?” Klein added.
“Especially for the startup scene here in Europe, it is very important to think about the outcomes of the technology but not the regulation of the AI technology itself.”
Instead, Klein argues, companies need a more coherent, pan-European approach to pressing issues such as the energy crisis and digital transformation – and less regulation overall, not more.
Optimistic profits
His comments came after SAP reported bumper third-quarter earnings late Monday. The software vendor's shares jumped more than 4% to a record high.
The software giant reported total revenue of €8.5 billion ($9.2 billion) for the quarter, up 9% year-over-year, as sales related to cloud products jumped 25%.
SAP raised its 2024 forecasts for cloud and software revenue, operating profit and free cash flow. The German company has been working to shift to cloud computing over the past decade.
In 2016, SAP acquired Concur, a business travel and expenses platform, in a bet on software moving to the cloud.
Recently, SAP has made AI a big focus of its strategy as it looks to reposition itself for faster growth after rising interest rates and macroeconomic headwinds depressed technology spending and led to industry-wide layoffs.
In January, SAP announced a restructuring plan affecting more than 7% of its global workforce — or the equivalent of 8,000 jobs.
