Ladies and gentlemen, thank you for standing by. My name is Emma, your Chorus Call operator. Welcome and thank you for joining the SAP First Quarter Results 2016 Conference Call. I would now like to turn the conference over to Mr. Stefan Gruber. Please go ahead, sir.

Yeah. Thank you very much. Good morning or good afternoon. This is Stefan Gruber, Head of Investor Relations. Thank you for joining us to discuss our results for the first quarter 2016. I'm joined by CEO, Bill McDermott; and Luca Mucic, our CFO, who will both make opening remarks on the call today. Also joining us for Q&A are Board Members, Rob Enslin, who runs Global Customer Operations; Bernd Leukert, who leads Product Innovation; and Steve Singh, Head of SAP Business Networks and Applications. As usual, before we get started, I would like to say a few words about forward-looking statements. Any statements made during this call that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as anticipate, believe, estimate, expect, forecast, intend, may, plan, project, predict, should, outlook and will, and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual result to differ materially from expectations. The factors that could affect SAP's future financial results are discussed more fully in SAP's filings with the U.S. Securities and Exchange Commission, the SEC, including SAP's Annual Report on Form 20-F for 2015 filed with the SEC on March 29, 2016. Participants of this call are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. I would also like to point out that beginning this quarter, we have published a quarterly statement. This statement replaces the earnings press release and the interim report and contains all relevant information in one document. Going forward, we will issue a quarterly statement for each of the four fiscal quarters. Additionally, we will issue, as before, a half-year report and a full-year integrated report. Please keep in mind that unless otherwise noted, all financial numbers referred to on this conference call are non-IFRS and growth rates are non-IFRS as reported unless otherwise noted. Also, we would like to invite you to our Investor Symposium, which will be held on May 18 as part of our user conference SAPPHIRE NOW in Orlando, Florida. SAPPHIRE is a great opportunity to learn more about our strategy and product portfolio. And please see our IR website for further information. And now, I would like to turn the call over to our CEO, Bill McDermott.

Thank you, Stefan, and hello, everyone. Following an outstanding finish to 2015, SAP had a solid performance in Q1, our seasonally-smallest quarter. The results show that even as the world economy is changing fast, SAP represents the innovation, strength and stability of a market leader. Last week, I visited with numerous SAP customers. Here's what they told me. They're looking for SAP leadership in three main areas. First, S/4HANA, to be the 21st century suite of best-in-class business applications. Second, they want SAP line of business cloud and business network applications to remain best-of-breed. Third, they believe strongly in the idea of OLTP and OLAP in one database, a database, yes, that can do both transactions and analytics. HANA will be their database platform of choice. It is time for new architecture. On each count, it's clearly on me that SAP's fundamental growth drivers are rock solid. Let me share some Q1 highlights. We saw a continued fast growth in cloud at 33%, tracking to the high end of guidance. Non-IFRS cloud and software revenue was up 6% at constant currencies within our guidance range. We again saw our record share of more predictable revenue perfectly consistent with our well-known strategy. IFRS earnings per share were up 38%. Non-IFRS EPS was up 9%. Please note, I think it's interesting that this performance significantly exceeds our peer group benchmark. Now, let me add some commentary on our growth drivers for the company. SAP added more than 500 S/4HANA customers in the quarter of which approximately 30% of those are net new. This means that SAP is successfully migrating customers from our own R/3 system and from competitive ERP systems as well. We continue to see widespread interest in S/4HANA migration as customers seek to reduce complexity, reduce hardware cost, improve their…

Thank you very much. I hand it back to the operator. Could you please start the Q&A session.

Ladies and gentlemen, at this time, we will begin the question-and-answer session. And one moment for the first question, please. First question comes from the line of Stacy Pollard of JPMorgan. Please go ahead.

Hi. Thank you. Just to dig in a little bit on margins. Services gross margins were weak in the first quarter. Can you talk about why that was? And I know you mentioned third-party costs, but maybe dig in a little more? And then how you expect to progress through the rest of the year and what your midterm target would be? And then, while we're on the margin, maybe just to touch on the business networks gross margins improved but the operating margins declined, maybe just talk about that. Finally, touch on that sort of 2018 pivot point, if you can, and what kind of expectations or how we can measure your progress towards that,

Yeah. So, I'll take the first one and the last one and then maybe, Steve, if you want to chime in and comment on the business network performance. So, in terms of services margins, what you have seen is an interesting development in Q1. On the one hand, we have actually returned to growth in our services business. So you've seen the 6% constant currency growth there, which consisted of a continued very positive double-digit growth in premium engagements and the return to single-digit increases in our classical project consulting business. So, that was the positive side. However, we had a lot of projects where we needed an expanded amount of third party resources to fill in due to that demand that was building up. That's something that we fully expect as part of our resource management process to be pickup and moved closer towards the usage of own consultants as we move forward. But in Q1, this resulted in a quite significant exceedance of the third-party budget in the services line of business. We also need to see that generally there is a shift in the pattern of the consumption of services. Because we are moving to a cloud world, we clearly see that there is a trend to smaller, nimbler, quicker, faster projects, which, of course, has at their center to make sure that customers can start to consume the Software-as-a-Service solution or the business network solution as quickly as possible. So, we have an exponential increase in these could type of services versus classical, bigger monolithic, on-premise implementation services. Those tends to come with a lower margin profile and it's not the intent to harvest particularly margins in this area, but to make sure that the customer can deploy and can use the cloud solution as quickly…

Yeah. Of course. So, Stacy, a couple of things to think about. Number one is, obviously we're pleased with where the gross margin sits for the business network group. Expect it to continue to trend up over time. I don't see any reason why the gross margin in that business can't be as strong as obviously best-in-class cloud businesses. And frankly over time, even a little bit stronger than that. On the operating margin side, a couple of things to think about. First and foremost, typically, we started investing in the early part of the year for sales ramps in head count, as well as marketing spend. And so really, it's beginning of the year investments that push the margin down a little bit. The one other thing I would ask you to please think about is that if you think about where Concur, Ariba, Fieldglass which are the three primary components of the business network group, where they focus, we think there's a tremendous opportunity as we ramp that sales organization to also leverage other products and services at SAP. So, to go drive sales of our ERP solutions for the small and medium-sized market. And so we're ramping investments across the business network group in anticipation of driving additional business – acquired business across all of market segments.

Okay. Thank you very much. Let's go to the next question, please.

Next question comes from the line of John King of Bank of America. Please go ahead.

Great. Thanks for taking the questions. I've got two if I can. So, firstly, on the license side, obviously, it seems like you had a bit of slippage at the end of Q1. There were some commentary in the statement that you'd started Q2 strongly. Can you say how much of those deals that might have slipped have already been closed? And just I guess more generally, how licenses should face through the year? Obviously, you've got a pretty tough comp in Q4, so just give us some of your thoughts around how we should think about licenses in the next few quarters. And then the next one was a follow-up on the gross margin side, Luka. For the on-premise gross margin, obviously a good progression there, the restructuring, and it sounds like it's helping. The other side to this is the third-party databases that I guess you've historically been selling as you transition away more towards selling HANA as your primary database. Is that having, at this point, a positive impact on the margin? How would you see that going forward? And perhaps, just first of all, maybe where are you in terms of selling your proportion of ERP licenses that is sold with HANA versus third-party database today? Thanks.

Thank you. Luka, do you want to go through the margin question first? Luka Mucic - Chief Operating & Financial Officer: Yeah, absolutely. So, first of all, the progression on software and support gross margins is indeed two, I would say, two effects – two main effects. One is clearly the success that we had with our company-wide transformation program. Virtually, all of the games that we had through reducing capacity and functions that are contributing only to slow or no growth or our overhead functions are in this space in the cloud space. All of our cloud gross margin expansion had virtually nothing to do with the transformation program, but was on efficiencies. And so, this has a huge positive effect for us and will continue to have a positive effect through the remainder of the year. As I shared last year, we have a mid-triple-digit million euro annualized run rate savings that we will generate in 2016 from optimize. Not all of this, of course, will be flowing directly to the margin and to the operating profit because we are reinvesting in areas where we can have strong growth as we have seen also in Q1 and in Q4, but, definitely, it has helped a lot. And you are absolutely right. Our third-party database royalty share goes down quarter-over-quarter, year-over-year. That has been the case for a quite few years now. And by now, of course, the sale of S/4HANA including HANA database as opposed to additional feeds on classical ERP applications than additional third-party databases is far bigger to the advantage of S/4HANA. And so that, of course, has a positive margin impact as well, and this will continue as well, albeit not at an as high pace anymore as in the last one to two years, because, quite frankly, there isn't hardly anything left rather than a few edges that we can sell off based on old database legacy products.

Thank you, Luka, and I'll just comment – this is Bill – on the deals and kind of the picture on the pipeline and so forth. So, I think everybody here is experienced in the software industry. So you know when you have an extraordinarily strong Q4 and full year as we did in 2015, when you go into Q1 and that's your smallest quarter of the year, kickoff meetings and all the other things that happen in software companies, you can often run into the timing of, especially on-premise or perpetual license deals. And we did see some of that, and that was reflected in our on-premise license. Of course, the cloud and the predictable revenues are much easier to manage with the point-to-point timing cycles in software. That's why it's a nice business to be in. Having said that, yes, we did sign many of the deals that were supposed to be signed in the last week of March already, and I've inspected the pipeline quite rigorously. Whether it's the core or the cloud or the business network, the company's pipeline is very, very strong. So, we are in good shape and we're executing on all cylinders. And typically in SAP, we have seen acceleration of our momentum continue as the year progresses. This is a normal trend at SAP if you look at the history of the company. I really am excited about this management team. Everybody is very well aligned. The company is quite inspired, and we also have our leader of Global Customer Operations on the line if you like to make a call, a comment or something. Rob. Would you like to add anything to what I said?

Not too much, Bill. As you said, Q1 was a little slower than we would have liked. But when we look at the pipeline and we look at S/4, we look at the cloud line of business, our pipelines continue to trend very, very strongly, and I feel very confident that we will deliver on these numbers. Just as you said, the slippage deals are all but in. We're off to a really fast start in Q2 and I would expect a continued acceleration with SAPPHIRE taking place in May.

Okay. Thanks.

Thank you, Rob.

Thank you very much. Let's go to the next question, please.

Your next question comes from line of Gerardus Vos at Barclays. Please go ahead, sir.

Hi. Good day. Thanks for taking my question. Just a follow-up on John's question on the licenses. The deal volume for on-premise deals stayed very strong. I think it was up 7% year-on-year, suggesting that some of the larger deals, particularly in the U.S., kind of slipped during the quarter. So just wondering if that's a correct assessment of the quarter. And then secondly, on the OpEx, the OpEx was up just below 4% year-on-year for the kind of quarter. Is that the kind of run rate we should anticipate for the year? And then finally, just finishing up on S/4, could you give us an update with the amount of go lives and the amount of live customer share you have year-to-date. Thanks.

Do you want to start on the...

Rob on the volumes.

Yeah.

Go ahead with the volumes. Yeah.

Yeah. So, I think when you look at the deal volumes, the deal volumes are starting to trend upwards. We're starting to see more volume in deals. Quarter-over-quarter comparisons with large deals, they were pretty much the same. We had a couple of more significantly sized deals in Q1 of 2015, but we see that trend going in the reverse direction. When it comes to S/4, we added 500 new customers in the quarter. More than 30% of them are completely new to SAP. Our live projects are at 146, trending upwards, and we have 539 projects that are ongoing right now, both on the finance and on the logistics piece of the solution. So, that's actually trending up extremely positive. More and more customers taking the solutions live. Luka Mucic - Chief Operating & Financial Officer: Yeah and then maybe I'll cover the OpEx question. Yes, I'm actually a bit proud that cost containment was certainly one of the virtues of this quarter. And we believe that we will continue to focus on the right investments. And also, we will certainly not hold back. We know where the areas are that we want to strengthen. It's very clear. It's innovation around S4, around our best-of-breed line of business solutions, around the business network, around the platform, and this is where we continue to invest. We will also continue to invest in strengthening our capabilities around our cloud delivery operations. But all in all, we expect as we have guided as well that we will deliver operating profit progression, and of course this requires us to also maintain good discipline on OpEx spending, and this will be aided all the way through the year by the success of our transformation program. You have seen already in Q1 the big discrepancy between our IFRS net profit and the non-IFRS, where you see clearly the impact of the cost of the transformation program that has dissipated. That effect, of course, will rather even further amplify as we progress through the year as the impact from restructuring has been most felt in Q2 and Q3. And then of course also, the run rate benefits will tend to rather further increase as we finalize, so to say, the annualization of these savings through the last people exiting the organization.

Okay. Thank you. The next question, please.

Next question comes from the line of Alex Tout of Deutsche Bank. Please go ahead, sir.

Hi, guys. Thanks for taking the question. Just obviously with the 10% license decline, I guess this question is more generally in the market around what the macro picture looks like. So, I'd appreciate it if you could give us a description of pockets of strength, pockets of weakness. We've seen high-level indicators like PMI and industrial production being a bit weak in the U.S. Has that impacted some of your traditional manufacturing clients perhaps? And then I don't know if you mentioned this already, but did you say how many of the S/4HANA customers are currently live at this stage? And can you give us an idea of the proportion running on-premise versus in HANA Enterprise Cloud? Thanks.

Anybody want to start?

Yeah. I'll start. Don't forget, we also have Bernd Leukert, who leads our development efforts in addition to Rob Enslin. So, I'm sure they'd both like to give you a perspective. First of all, there is no limitation to SAP's growth based upon the global economy. Let's just take that right off the table. When you look at China, China is still a dream and if it grows at 6.5%, it prints a Switzerland this year. So don't worry about China, I was just there. India looks great. And yes, there are some rough spots in Latin America like Brazil. And yes, we do have issues like everybody else about Brexit and so forth. And the United States is basically a slow-growth situation but a more normal situation than it had been in the past few years. So, the global economy is in no way, shape or form working against SAP. In fact, the beauty of SAP is if you need to get your costs under control, you need systems like SAP. And especially with HANA and S/4HANA, if you need to grow and think about new industries and new routes to market and new ways to create channel coverage with omnichannel e-commerce and other enablers, you need SAP. So, we are in demand. The key to SAP is making sure the recurring revenue streams continue to come in strong with heavily satisfied customers and loyal customers, also continuing to expand in the cloud and the LOB cloud, the business network, and the HANA Enterprise Cloud come quickly to mind. And yes, on the on-premise kinds of things, because companies have to have very clear roadmaps, very clear time to value and return on invested capital scenarios and they really need to be coached on what to do first, those…

On the S/4HANA customers live and to HEC versus on-premise. Maybe, Bernd, do you want to comment? Bernd Leukert - Member of the Executive Board, Head-Products & Innovation: No. Just a reconfirmation on the number which Rob shared with you was 146, close to 150 S/4HANA live customers. And as well, the related question towards HEC versus on-premise versus the public cloud offering, I think it was an extremely smart move from us that we offer the HANA Enterprise Cloud as a transitioned step for customers to go from the existing on-premise landscape into a public cloud offering. So, we are really proud that the HANA Enterprise Cloud is our fastest-growing cloud offering. We have as well a significant acceleration in terms of time to adoption. And I think an additional data point I want to share with you while we have been close to 100 customers at the end of Q4. Now we are close to 150 customers shows that the number of customers who go live has been significantly accelerated especially during the course of Q1. And just looking at the more than 500 projects that are still running, I see that trends will continue. So, we will see a heavy adoption curve not just in sales specifically, as well in live customers. And what we are extremely proud of that more than 30% of these live customers are referenceable customers. I think this is a real testimonial that the business of S/4HANA is rock solid, is providing the value, is providing the benefits to our customers. And this is, I think, something we have hardly achieved in any new products which we launched to the market. And just remember, S/4HANA is on the market since February 2015. We as well see now adoption of the S/4 public cloud which is starting as customers ask us, let's say, to get rid of their old customized system and transition into a public cloud, clean offering which helps them to massively adopt new innovations as they come out quarter-by-quarter. And just to answer the final point, while the start of S/4 was, I would say, on-premise only, now especially the cloud system is adopting in a rapid way.

Okay. Thank you very much. Let's take the next question, please.

Next question comes from the line of Ross MacMillan of RBC. Please go ahead.

Thanks a lot. Bill, I just had a question on vertical industry spend. I was curious as to whether there was any particular industry that was weaker this quarter, I'm thinking energy in particular. And then for Luka, you laid out a framework for margins in the cloud going from public while going for business network at the top down to private cloud at the bottom. And I'm just curious with the improvement you're seeing with HEC and the private cloud business in general, any changes to your view on that sort of 40% gross margin target or even taste to the 40% gross margin target? Thanks.

So, Ross, thank you very much for the question. The industries and as you know it's good to have 25 of them because at any given time, you're going to have some that are worse off than others. In our case, we saw softness in basically three of them compared to the other 22. The softer ones would have been energy. I think it's well known. The cost per barrel being what it is, they need to bet another $15 of barrel to sort of be in a business model that they feel comfortable making large investments in. So, I think you know that. Public services, a little softer than I had anticipated. If you look at it across the globe. So, I'm definitely going to reorganize that. And then as it relates to discrete manufacturing, probably some of those were lumpier in terms of the decision making cycle. So, on the energy side, the pipe is there. I think when the price per barrel gets a little bit better, so will the money. Public sector, it's just a structural issue and an execution issue. We have to digitize government, right? So, if India is digitizing, we're the one that needs to digitize India. And then discrete manufacturing, I think you have a situation where everybody knows they have to move out and they have to make change. But we have to be so crystal clear and so prescriptive on how they do it, how it gets consumed and how they've derive the value from it that you cannot leave a single question unanswered. And that's the environment that you're in when you're dealing with tighter industries that really are working with tight budgets and significant constraints. The cloud's one way to deal with that. So, too, is the HANA Enterprise Cloud or the open ecosystem that we have, but you still have to answer the questions and have everything tight for boardroom-ready conversations. So, I reiterate, those are interesting learnings. Not global economics. It's all about execution and how swift you are executing as a company. So, our step has gotten increased substantially in those scenarios as a result to what we learned.

Yeah. And maybe on the cloud gross margins by business model, no, the framework that I laid out absolutely still holds. And as I've said at the beginning of my remarks, we are executing against them in the business network, our long-term gross margin target is 80%. We're continuing to make steady progress against that. We went up 20 basis points to €75.3 million in the first quarter. And I fully expect additional expansion in line with the plan in terms of the public cloud gross margins. And the same applies, and the more we scale our business around SuccessFactors, the better we will get in that part of the business as well. And finally on the private cloud, we are making great strides. And I need to give a lot of credit to the team and then Bernd Leukert who are really turning the corner now. We have professionalized the whole operations from onboarding to continuous operations. We are not only having strong growth in terms of the top line and bookings, we are also getting these customers live. We're getting the revenue now, and we are increasing the efficiency through the scale that we are getting. So, the 40% gross margin target is something that for me, is readily achievable. Actually, as I've said, when you take a look at our ATS segment where the private cloud is booked, you've seen that we have had an exponential improvement in the gross margin there. I've always talked about us reaching the breakeven point in our private cloud business sometime this year. Actually my full expectation is now based on these great results that we will be there by midyear already. And then from that point on, there will be only one way and that is into the positive direction. And Bernd is nodding, so you are not seeing this, but I just want to confirm this now.

Thank you.

Thank you.

The next question, please.

Next question comes from the line of Michael Briest of UBS. Thank you.

Thanks, and good afternoon. In terms of M&A, Bill, I think you and Luka were very clear last year that you were a tuck-in kind of play. Obviously cash flow is very strong in Q1, and there has been quite a lot of volatility in the stock market, so I'm wondering if that makes you willing to be more opportunistic, perhaps larger deals will be something you consider this year. And then secondly, Bernd, in terms of the development of S/4, you had two interesting press releases this year with Accenture and IBM on co-development activities. Can you talk a bit about what they're doing, what level of R&D effort there bringing to the party and why you've decided to work with them? Historically you've not done that.

Michael, this is Bill. I'll start off on the M&A front. Our strategy hasn't changed, but we remain a market-leading company. And if we do things, it will be well thought out and it will be something that's not only in the interest of the customer but also very much in the mathematical interest of the shareholder. So, at this stage of the game, we're steady as you go. It's not to say that something couldn't happen. It's just that there aren't a lot of assets on the market like there was in the old days that are worth really aggressively pursuing. For example, most of those lines of business cloud companies I mentioned earlier in my remarks. We think for companies that have that kind of valuation that don't make any money, it's a no go. You know what I mean? So, that's it. But there might be other things that are more within a normal-sized range that are considered a tuck-in for a company our size and scale that would be interesting, but we're pretty conservative at this moment but also remain a market leader and aggressive growth company. Bernd Leukert - Member of the Executive Board, Head-Products & Innovation: Yeah. Not a lot to add, and I said this too this morning on TV. I mean, SAP has always been acquiring in order to extend its solutions capabilities. That's something that you need to remember. We're not in that business because I read a commentary in order to buy revenues or market share. We want to service the customer best and we want to make sure we have the most holistic solution portfolio in the industry, and the white spaces that we have to fill in this space are, by definition, getting smaller and smaller. And therefore,…

Sorry, can you give any sense on how many partners are working with you or how many people at Accenture and IBM? Bernd Leukert - Member of the Executive Board, Head-Products & Innovation: I don't know the exact number, but it's in the hundreds. And so, it's not a few.

Yeah, Bernd, I can give Michael some color as well. Michael, this is Rob Enslin. There's over 15,000 individual HANA certifications that have taken place with our partners today, and they buy the thousands every quarter, so more and more scale we have in that space. I'm actually sitting here in Africa, and I can tell you now that the digital transformation of Africa is happening right here in South Africa, and more and more partners are joining on. So, we will continue to even add more to that list as you move forward.

Thank you.

Okay. Thank you. The next question, please.

The next question comes from the line of Adam Wood of Morgan Stanley. Please go ahead, sir. Adam D. Wood - Morgan Stanley & Co. International Plc: Hi. Thanks so much for taking the question. Just first of all on the Customer Engagement and Commerce. I think you're making more noise around that. There's obviously a large cloud there in that space. Maybe, first of all, could you give us some feel for the win rate in the SAP installed base around those solutions and maybe give us an example of you talk about using Hybris, expanding that out. There's HANA in there as well, there's the front-to-end integration. Is there a tangible example you can give the customer that the benefits from that, and what the benefits are of that integration versus CRM being a point solution? And then maybe just on the financials, the cash flow was very strong in Q1 as always, but actually if we look in a little bit more detail the DSOs didn't move up and the deferred revenue income balance was actually down year-on-year, was there anything unusual there? Was that quarter-end FX or something strange that moved those two numbers? Thank you.

Yes. Maybe I'll start with the cash flow question, and then the colleagues can handle the CEC and win rates question. It's actually one simple reason. So, you have pointed to a reduction in deferred income. The reason is that we had in one region of SAP, the Middle and Eastern European region, a practice in the past that we were pre-billing maintenance invoices. So, we would invoice the maintenance on the last day of the preceding quarter, so to say, which would then result in a buildup of a higher deferred basis at the end of the quarter, and which would then be reversed in the coming quarter, so to say. We have discontinued this as of this quarter for various reasons, operational challenges with the collection of POs and so on. And so therefore, we have further reduction of PO in the deferred income. To give you an idea, I mean maintenance invoicing in Germany alone is having a volume of roundabout €500 million on a per-quarter basis, a bit more actually even. So, that's why this has a noticeable effect and reduces actually the deferred income balance as we have discontinued this practice. This also explains a good part of the movement in the DSO, because we did this as a first-time impact, this has an effect on the DSO calculation as well. Not necessarily so much on the cash flow because those two or three days will probably not move the needle tremendously in terms of when we will get the money from customers. But in terms of DSO and the way how we calculate it, it actually has an impact. Some more effects on the DSO were that in China, we are having a kind of corporate legal entity restructuring. So, we have come from…

And maybe I could just give you – this is Bill – one real-time story happened yesterday. A Chairman, CEO, Founder of a very successful retailer, what was his goal? His goal is to deal with his board. And when his board meets him, they want to talk about growth. So, how are you going to grow? Are you going to open up more stores in retail? Yes, and probably you are if you're doing well. But also you have to open up e-commerce, and you have to figure out a way to get the direct-to-consumer channel really growing, not just in theaters that you participate in today, but in theaters that you've yet to confront especially in Asia because that's where the rising middle class and the growth is going to be in the future. So, the conversation that's going on in the board room isn't about pipelines and outlooks. It's about channels, and it's about combining the social media profile with the enterprise profile and how you can leverage that utilizing omnichannel e-commerce. What Bernd said is really extending the S/4HANA ERP. What I'm saying is the omnichannel e-commerce. When you put those two forces together, now I can manage my supply chain the way I make my products, the way I ship them and keep their promise to the customer every time in any channel, in any theater. And I conduct e-commerce transaction, rinse and repeat that cycle without any friction with my consumer. That's how you grow companies. Adam D. Wood - Morgan Stanley & Co. International Plc: That's pretty helpful. Thank you.

Thank you very much.

Hello?

The first question is from Aaron Ricadela of Bloomberg. Please go ahead.

Okay. Thank you. My question has been largely answered, but I do wonder if you guys could put any more precision on what happened to new license in the United States and was any softness in the U.S., was that mainly attributable to cloud transition, a reluctance to sign on to prem deals, or was that more of a competitive situation? Anything else you could say about the U.S.?

Hey, Aaron, it's Bill.

Hey, Bill.

Yeah. I'll give you a quick debrief. First of all, you should know that the cloud business in the U.S. remains particularly robust. Even against competitive benchmarks, SAP in the U.S. grows faster than the other cloud companies. So our cloud business and the cloud market in the U.S. is very robust, but it's also quite interesting to note that it is the first mover in cloud in the United States. Cloud is the most accepted form of enterprise computing in the United States. So I think you're going to continue to see an acceleration of cloud in the United States. Having said that, the on-premise business in particular was lumpy in the United States, which I said. And the only thing I can tell you is the pipeline, especially on the S/4HANA side looks particularly robust in the on-premise and in the private cloud world in the United States. So structurally, we look great in the cloud. The on-premise looks a lot better than competition. And the pipe and the execution I expect to steadily improve as the year progresses. So there is no macro issue about SAP's market position in the United States. Quite on the contrary, the United States is a beautiful market for us and expect us to do very well.

And a quick follow up, Bill, on that. As these older R/3 implementations maybe end the near of their useful or the end of the time at which customers might want to continue running them. To what extent are those up for grabs? Is that for a shoe-in or are you competing for those deals?

Great question. And let me be completely clear by giving you a firm example. I recently met a chairman and CEO of one of the world's largest and most respected global companies. He has ECC or an R/3 version that's 20 years old. The meeting starts out, he's like, "Hey, Bill. I love my system. Great seeing you. It runs my supply chain. All of my billing and financials, it connects me to my customers and I'm really happy with it. So thanks a lot for stopping by and, you know, next time let's get some dinner." I said, "Well, thank you, but I didn't want to let you know, a lot of things have happened in the last 20 years. I'd like to give you an update." So there's two things that you should take away from that. One is the loyalty and the happiness of our customers with their existing R/3 implementation is off the charts impressive. So SAP makes some great software. And that's why our loyalty ratings on our existing support revenue is near 100% for customers that are still in business. Now, the challenge that we have is to make sure we educate C-level executives on the power of S/4HANA, what we have done with the line of business cloud, what we have done with the business network and how we can shape them into the conversation of growth. What are you doing to grow? What are some of the new business model innovations that you're bringing about? How are you combining an enterprise and a social profile? What channels are you going to market in? Have you explored the power of e-commerce to complement your normal sales trajectory, et cetera? Then we end up in a very clear road mapping conversation, and you heard me say that a few times today. People need a color, by numbers, education. With big crayon. How to go from old world to the new world. Giant crayon. And it's only fair that SAP become the one that educates them on how to digitize their enterprise, how to take care of their customers and how to drive shareholder value. And that is a process that does take time, but it's not in response to a competitive threat. It's an opportunity cause for us if we don't get there and do the right education because they'll just be happy on the old system. It's not all bad, but I'd rather than be happy on the new system and grow their companies faster and improve the GDP of the world.

Thanks a lot. Appreciate it.

Thank you, Aaron.

Thank you. We have one final question.

Thank you. And this is from (1:08:25) of Reuters News. Please go ahead.

Hi. Good afternoon. Just one question about Britain and how are you looking at the discussions that's going on over there about a potential exit from the European Union and how big is Britain in your EMEA region in terms of revenues?

First of all, Britain is a very significant market for us, and we are very familiar with the Brexit issue and we have met with the leaders of government, the leaders of business. And while it's an incredibly important decision and one that the people of Great Britain will ultimately decide upon, we do not see that impacting our particular business model because either way, the technologies that SAP makes will have to be administered to manage the companies. So it's a fascinating issue. Yesterday, in fact, I had a conversation with somebody who's very world travelled and writes about these things, and it is intellectually and interesting exercise. I don't think that SAP is going to be impacted by it, but the good news is, when you think about digital UK, we're in the center, in the epicenter of that strategy and therefore we thought through plan A, B, C and D and I think you'll see SAP technology do just fine. It remains a very important market and a growth market for us.

Okay. Thank you.

Okay. Thank you. Thanks a lot. This concludes the Q1 2016 earnings call. Thank you very much for your participation and good-bye.

Ladies and gentlemen, this concludes the SAP conference call. Thank you for joining. You may now disconnect.