However, the growth is more moderate than in 2019, when the industry reached a turnover of EUR7.3 billion, higher by nearly 20% than in 2018 and by over 69% than in 2015.
The Romanian software industry remains among the key industries for the country’s economy, with the IT&C sector accounting for 6.1% of the gross domestic product in 2019 and for 7.1% in the first half of 2020.
In 2019, Romania had more than 24.000 software companies, 6.2% more than in 2018 and 38.9% more than in 2015, of which 22.600 microenterprises, 1.100 small firms, 328 medium-sized firms and 20 large companies. The bulk of turnover was generated by medium-sized companies, with 37.4% of the total, being followed by corporations with 25.7%, small firms with 19.8% and microenterprises, with 17.1%. The software industry is one of the most balanced local industries as regards the distribution of turnover on types of companies. The difference of maximum 20 percentage points between categories is relatively minor compared with other key sectors in Romania.
The largest software company in Romania remains Oracle Romania SRL, with a turnover of over EUR200 million (2.7% of the total), being followed by IBM Romania (over EUR197 million – 2.6% of the total), Ericsson Telecommunications Romania (over EUR161.3 million, 2.2% of the total), Bitdefender (nearly EUR140.5 million) and Endava Romania (nearly EUR135.5 million).
The top ten companies in the Romanian software industry had a combined turnover of nearly EUR1.3 billion, or 17.6% of the total. In terms of profitability, the results are positive: the net profit grew by 27.3% versus 2018 and by over 110% versus 2015, exceeding EUR1 billion in 2019.
Of the 24.000 companies analysed, 16.000 (67%) reported profit, some 6.000 (25%) reported loss and the rest broke even in 2019. The number of insolvencies dropped over 25% versus 2018, to 56 in 2019.
The most profitable player on the local software market in 2019 too was SAP Romania (with a net profit of EUR36.4 million, lower than over EUR40 million in 2018, the decrease was below 8% in the national currency). The five most profitable companies had a combined net profit of EUR104.2 million in 2019, or 9.7% of the total.
The number of employees in the software industry has increased by 43.3% over the past five years, to 130.000 in 2019. However, according to 2020 Eurostat data, Romania ranks first in the European Union regarding the shortage of employees in this sector.
The largest software employers on the local market are Oracle, which ranks first with 3.400 employees in 2019, IBM, with 3.300 employees, Endava with 2.600 employees, Ericsson Telecommunications Romania cu 2.600 employees and Atos IT Solutions and Services, with 2.200 employees. Overall, the top five local employers accounted for 10.8% of the total workforce in the local software market.
Capital Bucharest continues to attract the largest local software companies, with Bucharest-based companies operating in this sector reporting a turnover of EUR4.3 billion in 2019 (58.7% of the total). The county of Cluj comes second, with a turnover of EUR1.1 billion in 2019 (15.5 % of the total), being followed by Timis, with EUR347.7 million (4.8%), Iasi, with EUR341.4 million (4.7%) and Brasov, with EUR185.3 million (2.5%). Overall, the top five Romanian counties account for 86% of the turnover reported by the country’s software industry.
The coronavirus pandemic triggered an immediate and stringent need for digitalization in several key sectors in Romania. Thus, IT companies in Romania had the opportunity to develop and quickly deliver relevant software companies.