Accountancy software giant Sage has reported an impressive trading performance for the first nine months of the year.

The Newcastle-headquartered Sage, which also provides HR and payroll technology for small and medium-sized businesses, saw group revenue increase by 6 per cent to £1.4bn in the first nine months of the year, and by 7 per cent to £488m (Q3 21: £456m) in the third quarter.

In a trading update on Tuesday to the London Stock Exchange for the nine months to June 20, 2022, chief financial officer Jonathan Howell said: “Sage has performed strongly in the first nine months of the year, with momentum continuing to build, as more businesses choose Sage Business Cloud solutions to support their digital transformation.

“As a result, we now expect organic recurring revenue growth for FY22 to be towards the top end of our guidance range of 8 per cent to 9 per cent.

“While we are mindful of broader macroeconomic trends, I am confident that continued delivery against our strategic priorities will ensure Sage remains well-positioned for the future.”

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Recurring revenue for the first nine months of the year increased by 9 per cent to £1.33bn, driven by a 20 per cent rise in Sage Business Cloud revenue to £886m.

Software subscription revenue grew by 14 per cent to £1.05bn  (Q3 21 YTD: £922m), resulting in subscription penetration of 75% (Q3 21: 69%).

Regionally, North America achieved recurring revenue growth of 13 per cent to £557m (Q3 21 YTD: £493m), with a strong performance from Sage Intacct alongside growth in cloud connected products.

In Northern Europe recurring revenue grew by 7 per cent to £311m (Q3 21 YTD: £291m), driven by continued success in cloud native solutions including Sage Accounting, Sage Intacct and Sage HR, supported by growth in Sage 50 cloud connected.

In International, recurring revenue increased by 5 per cent to £462m (Q3 21 YTD: £439m), with growth across the Sage Business Cloud portfolio.