The company said it had suffered from the lack of investor confidence in the US and Europe following the Enron and WorldCom accounting scandals.

It said it would post a net loss of 235 million euros (£150m; $232m) for the April to June period, which was worse than analysts' expectations.

SAP said it was now predicting sales growth of between 5 and 10% for the year, against a previous forecast of 15%.

Losing out

The German company - which is the world's largest supplier of business-management software - said it had lost a number of deals for which it had informal agreements last month.

"If you take the top 50 companies in the world, a lot of them are SAP customers," said co-chief executive Hasso Plattner in a conference call.

"And if some of them are on TV every day under some scrutiny and their share price drops out of the sky, then it's highly unlikely that they sign deals."

The net loss of 235 million euros included a one-off charge of 414 million euros to write down the value of some of its US investments.

Overall sales fell by 4% to 1.8bn euros during the second quarter, against analyst forecasts of 1.9bn euros.

SAP shares closed down 14% on the Frankfurt exchange at 74.80 euros.

In April SAP recorded a 40% drop in profits for the first three months of the year, but said at the time that it still expected sales growth of 15% during 2002.

Now the company says that if economic conditions do not improve growth will only be 5%.