Stefan Gruber - Director, Investor Relations Werner Brandt - Chief Financial Officer Henning Kagermann - Chief Executive Officer Leo Apotheker - President of Customer Solutions and Operations, and Member of the Executive Board

Charlie di Bona - Sanford Bernstein Kash Rangan – Merrill Lynch Rick Sherlund Art Weiss - Germany John McPeake - Prudential Peter Kuper – Morgan Stanley Diana Hynd - Managing Automation Magazine Stefan Gruber: Hello everyone, and welcome to SAP’s second quarter earnings conference here in New York City. My name is Stefan Gruber, Head of Investor Relations with SAP. I would like to give you a quick overview on the agenda for today. First, Werner Brandt, the CFO of SAP will walk you through the numbers and to the outlook. He will also comment a little bit on the issue which was discussed last week on the call, order entry versus recognized software revenues. Next, Leo Apotheker, President of Customer Solutions and Operations, and Member of the Executive Board of SAP will provide you with an update on our recent performance and our success in the mid-markets. Finally Henning Kagermann, CEO of SAP will comment on the business environment and our enterprise roadmap. I would like to give a quick comment. This conference today is being webcast on our Investor Relations web page. So later on, for the Q&A, please use some of the roaming microphones here in the room. Finally, before I get started, we have a Safe Harbor statement. Please note that except for certain information, matters discussed in today’s conference may contain forward-looking statements which are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect the Company’s future financial results are discussed more fully in the Company’s most recent filings with the Securities and Exchange Commission. Now I would like to hand things over to Werner.

Thank you, Stefan. Good morning. Here is a snapshot of what we present today. First of all, Q2 financial figures at a glance. Both software and product revenues increased by 10% year-over-year at constant currency. We had a very strong order entry performance, and we are on track for the first half of the year. Total operating expenses increased by 7%, which gave us a leverage in the second quarter. Pro forma EPS increased by 38% to €1.41 and benefited from a reduced effective tax rate of 25% in the second quarter. Some important deal metrics for the quarter. Number of deals increased by 18%; indirect sales increased by 20% year-over-year. This is based on the number of deals. Direct sales increased by 17%, heading up to 18% quarter-over-quarter. Business with new customers is 24% of order entry. You see the number for 2005 here, and you see some metrics with regard to the increase of the number of deals with a size of more than €5 million and below €1 million. This seems to be very stable if you compare quarter over quarter. If you look to the half year figures, you see first of all we have 1,870 new hires on an FTE basis in the first half of 2006, with investment focused, as always, in R&D and sales and marketing. Of course, this number is also impacted by positions we did. Remember, [inaudible] commerce, [Pax] results and [Kimetrics]. I think it is important to mention that 42% of our new hires were hired in low-cost locations in the first half. For the full year, we still target to hire 3,500 employees in 2006. Further efficiency improvement, I think you saw a very strong pro forma margin increase by 80 basis points quarter over quarter, and this is driven also by a very strong pro forma service gross margin increase by 100 basis points, or 1% to 26% due to better utilization rates. It is important to talk about billable utilization. Now if you look to the key figures for the quarter, as we always do, you see software revenue as indicated, 8%, 10% on a constant currency basis. With 10% growth on the maintenance side to €856 million, and the service revenue increasing by 9% to €686 million. We see total revenue increasing by 9%, and this on an actual and on a constant basis. With the leverage on operating expenses increasing by 7%, we come to a operating income margin of 24.2%. This is not pro forma, that’s the real operating income margin. The operating income itself increase by 15% , You see all of the other metrics here. Net income before income taxes increased by 26%, and I will talk about later, a bit about finance income too. The net income increased by 43%. I mentioned before the effective tax rate and earning per share increased to €1.35 by 43%. Now if you look to the pro forma numbers, we always start with EBITA, you see EBITA increasing by 14% on a quarterly basis, if you look to the depreciation amortization it is roughly €100 million and the margin is 26.7%. The pro forma operating margin, excluding stock-based compensation expanses and acquisition-related charges, increased by 13% and the margin itself achieved 25.4%. The effective tax rate is down to 25.1% and this is due -- and let me say it very clearly -- this due from a settlement with fiscal authorities on one specific topic. The impact was €30 million and this represents €0.10 per share. We said last week and I would like to repeat this here, if you look to the tax rate for the full year, we will see a rate below 32.5% instead of 34.5%. The revenue analysis, let me stay here for a second. First of all, I think its important to mention besides all the growth rates we see two things: the first one is that we saw a decline in the maintenance revenue on a sequential basis by €4 million. This is disappointing and we have two reasons for this reduction here of €4 million. Number one, of course, account. We mentioned this already in the call last week. This is roughly 50% to 55% of the story. The rest is, and we have to admit this, reduced maintenance for some customers across all regions, mainly in the United States. The second point I would like to highlight is the growth rate on the consulting side. You see here 9% on a half-year basis; it’s 13%. I want to make clear that we do not anticipate this kind of growth for the full year of 2006. If you go down to the operating expense analysis, we always start with the pro forma gross margin analysis for the second quarter here. You see first of all that we have a stable pro forma product gross margin. This is driven by an increase of all the expense elements within cost of product. You know we have [purchase] license here which increased by 10%, but also the support cost increased in this range, so we have an overall increase of pro forma cost of product by 10%. Let’s keep in mind that we have included in this pro forma cost of product also one-time hits coming from litigations and early in the quarter this was around €10 million. The service side improved here ,as mentioned before, on a quarterly basis by 1% or 100 basis points. First of all, if you look to the headcount you will see later the headcount in the service side is flat, but we are seeing strong margin improvements on the consulting side, as I mentioned before. 100 basis points improvement. Also on the training side we see 17% improvement here on the margin side. That portion includes it in cost of service. That which shows a decrease in margin is the hosting business, but as we indicated at the beginning of the year, we are investing in this hosting business in order to be positioned for new business models going forward. For consulting, again it’s billable utilization and also bits of utilization which helps us to bring up the margin. The key driver for this margin expansion came out of the US. So if you look to the product and service gross margin, it is 64% constant quarter over quarter, 2006 versus 2005. If you look to the half year, I think the picture is quite similar so this is only for your reference. Let’s come now to the pro forma cost analysis in the second quarter. I would like to start again with R&D where we have one clear focus in investment. This increase here of 11% is solely driven by an increase of personnel expenses and this is based on an increase of headcount in R&D by roughly 1,800, if you compared June 2005 versus 2006. Sales and marketing, as a percentage of total revenue declined by a percentage point. This is more a rounding effect; this is really not 100 basis points reduction here. Sales and marketing, if you split it, we had €290 million in sales increased by 6% and marketing expenses increased by 3%, up to €177 million. Both were driven by additional hirings in the quarter on the sales side, roughly 560 FTEs added. They are 65% in our regional process, the US market. Also if you look to the marketing, more than 200 new heads in marketing; 50% of this is around the global marketing we have here in New York. Again, if you look it to from a half-year perspective, not a real change. This is in line with the quarter. Now our pro forma operating expenses, if you look to this one, you see personnel is the key driver of the increase in pro forma operating cost and I think there is no need for further explanation. Let’s come to the consolidated balance sheet for June 30th. I think the balance sheet structure is healthy. I would like to highlight one piece here, that is a reduction in liquid assets. We see this on the next slide, we provide here bridging between the liquid assets by the end of December 2005, is more than €3.4 billion. We end up with €2.5 billion. The main levers here, besides increasing operational cash flow, which increases our cash and liquid assets, you see dividends of €447 million; you see spending for acquisitions -- and this is on cash flow basis here -- €486 million. You see that the repurchased stock, owned shares, at an the amount of €938 million and this is equivalent to 5.66 million shares at an average price of €165 per share. If you look to what we have in treasury stock as whole, it is now 11.3 million shares and the average share price is roughly €139 in our treasury stock. Keep in mind, we want to use this probably for options which are exercised [inaudible]. If you take the number of options outstanding, we have roughly 50 million outstanding, so we still room under this regime to increase our buyback activities. DSO, I think we saw an increase of one day. I’m sure that this will, with all the focus from the countries, will improve again this quarter. This first half we have an increase of one day, but at the end of the day that is not acceptable and we will do a lot in order to show improvement again. You see our equity ratio and our operational cash flow here. This is in line with what I said for the full year in terms of our ability to generate free cash flow in 2006. If you look to the head count, on a worldwide basis you see if you compare to March, a 5% increase in product. Remember this is the service and support organization, including custom development decreased by 234; they are up 30% in low-cost. The other area where we saw increase is R&D, with 580 in the quarter and 52 in low-cost locations. This number, as I said, is impacted by acquisitions in the quarter. The number is 316 FTEs coming from acquisitions; for the half year it was roughly 450. Here is one part I would like to spend some minutes on; software order entry where it is recognized as software revenue. You see fast order entry is a key indicator for future software revenue and order entry was strong over the last quarter, especially strong now in Q2 2006. Here you see the general rule, as software order entry increases, then a contract is signed by the customer and SAP and the contract is posted; posted means in our system, is entered into our system. Software revenue generally increases when a contract is signed by the customer and SAP and the delivery has occurred and the fee is fixed and determinable. Collectability, as probably you know all this must be fulfilled under the respective accounting guideline SOP 97. I have some typical examples for differences and If I only look to the top four deals in order entry, in the second quarter, we have order entry of 100 million and the realized revenue behind this was roughly to €30 million to €35 million. You see a [inaudible] here and this will come over time. There are several reasons behind it, which we have listed here. We will see one example which illustrates this. For example if you take face contracts, with committed phases, software order entry or phases upon signature, costing us the contract; that’s clear. We have an umbrella agreement over four years, but at the end of the day the customer commits to buy in phases over the four years, one-fourth of the entire software order entry. So each phase upon an agreed upon date. Then we can recognize the revenue. In one case, order entry was €28 million and revenue recognized was €50 million. Future functionality and undelivered functionality, of course of order entry, when we sign the contract, but software revenue recognition, according to the rules, is only possible when all functionalities are delivered. We had one instance here €20 million order entry, €50 million revenue recognized. Custom development projects; I think the multi-element agreement with custom development elements upon signature, posting of the contract, total contract in software amount. But if you look to the revenue recognition, its software revenue over the term of the customer development project. So it is percentage of completion. Here we had one case with €60 million in order entry but zero revenue recognized. This will come over the next quarters and years as we make progress with this development project. You have BPO and rental deals, as I mentioned here, and subscription deals, especially global enterprise agreements but that’s a topic I would like to leave for Leo who can explain some real life examples in a minute. The outlook, the outlook has not changed. The Company continues to provide the following outlook for the full year 2006 as described in its April 20th first quarter results press release. Let me read this so that its really communicated to everybody, with everybody not being present in this room. The Company expects full year 2006 product revenue to increase in the range of 13% to 15% compared to 2005; this growth rate is based on the Company’s expectation for full year 2006 software revenue growth in a range of 15% to 17% compared to 2005. The Company expects the full year 2006 pro forma operating margin, which excludes stock-based compensation and acquisition-related charges, to increase in the range of 50 to 100 percentage points, 0.5% to 1.0% compared to 2005. The Company expects full year 2006 full year 2006 pro forma earnings per share, which excludes stock-based compensation/acquisition-related charges and impairment-related charges to be in the range of €5.80 to €6.00 per share. The outlook is based on an assumed US dollar to euro exchange rate of $1.23 per €1; that’s very important, and the expected increase in headcount is 3,500 FTEs. As I mentioned before, a tax rate below 32.5%. That’s all from my perspective and now I would like to hand over to Leo Apotheker.

Good morning everyone. Thank you Werner. I’d like to give you little bit more color on what happens not only in the quarter but also in the half year; and then I’ll try to give you some visibility and some information on some of our performances across the board. So if I look at the half year, we grew our software revenues by 14%. In fact, Q2 2006 marks the 10th consecutive quarter of double-digit software revenue growth. That’s important to remember. We came in Q2 2006 exactly to The Street expectations, but a few things people should keep in mind. First of all, our order entry as Werner has already mentioned, moved much faster than recognized software revenue in Q2. Some deals were closed that will be recognized over a number of years. Werner already gave you some of the reasons why that happened. Indeed some transactions that we had hoped to close in the first half or at end of June were now closed in the second half of the year. The good news is none of these deals were and we expect to close all of them. We had a continued high win rate against our main competitor and that’s a good thing, despite many of the attempts that have been made, to change that, we continue to have a very high win rate. We have every intention of keeping it that way. We are on track to achieve full-year growth targets. Now let me give you some color about a particular transaction that we do, that is very important for us, for our customers, and also for you to understand. It’s global enterprise agreements. We are talking about a strategic partnership with a selected number of customers, and in fact what we are doing is, thanks to our ESA road map that is now available and the visibility that this has given our customers, we can now engage into a conversation with key customers who want to commit for a long period of time on the strategy for SAP. We can thereby underpin the relationship for a long period of time, usually five years. We signed two global enterprise agreements like this in the first half year, that is probably one of the things you have heard from, what you call nicely your sources of information. These are high double-digit deals; sometimes even low triple-digit deals. As I said, they commit the customer and SAP on a five-year relationship. We started this initiative about a year ago. Given the strategic nature of these things, the negotiations and the discussions and the conversations are long, because its not just about a deal it is about true relationships, the implementation of the software, what will be included, what won’t be included; because it is not a “as much as you can get” deal. It is usually with limited scope. We don’t put everything in there. Because of the nature of the deal, we recognize revenues quarterly on a pro rated basis over the term of the agreement. So if I take a global enterprise agreement of a 100 then it is over five years, that’s 20 quarters and therefore, the mathematics are pretty simple. That is as it is described on the graph. So when you hear that we win large deals that is absolutely true. We do win large deals. We actually win the vast majority of them. Some of them -- and we’re working on that, like in this example -- are structured in the way I’ve just described which explains also the large difference between order entry and our recognized software revenue. Our volume business continues to do really well. We added another 3,500 customers globally. Our indirect channel and our customer base continues to expand. We have now about 8,300 All-In-One customers; that’s a growth of 24%. We have 1,807 partners for All-In-One; that’s an increase of 24%. In Business One we have passed the 10,000 customer mark; its now 10,800. That’s 54% year-over-year growth, and we have about 1,300 partners selling Business One; that is 38% growth. As you can see, the channel is expanding and is gaining traction. We had strong revenue and a good number of contract growth from the indirect channel in the first half of 2006. We grew the number of contracts by 26%, and that gives us a little bit of a better balanced deal size contribution between the large deals that are something’s a little bit binary and denies flow of [inaudible] through the volume business. We had deployed the SAP partner program, which is recognize by many of the industry pundits as the best partner program in the industry. When I look at our various efforts in verticals in industries we have balanced our strong growth in both our traditional industries: life science, chemicals, oil and gas, telcos and utilities in also in our new focus industries, and in particular I would like to point out high tech, retail -- which is absolutely booming -- and public sector. We maintain our leadership in the small and mid-size business segment. We report this every quarter, you know how we do this so I won’t go into the mechanics again. As you can see, we do a good 30% of our $3.5 billion business all in four quarters in the SMB segments. That by itself is almost as much as the number two of the industry does in all of the segments globally in the entire business. Let me give you some information on Safe Passage. That continues to do really well, we have now 310 customers that have selected SAP as their trusted vendor as part of the Safe Passage initiative. We added in the first half year another 110 customers. A few key names that I can share with you today in Q2. We closed Dubai Aluminum and [Municipalities do Siria], [La Casha], [Cataron] Bank, [Cybervast de Pharmacione] CBC Corporation and Telefonica. We have extended the program in order to offer it as well to Seibel customers and we have opened an office in Australia and now we have global network of capabilities which is gaining significant traction, because of that. Some selected customer wins in the second quarter in the Americas: [Dell], Deloitte Consulting, Exxon Mobil -- I don’t need to tell you what they do – Inventis, Jabil Circuit, John Manuel Corporation, SC Johnson and the Home Depot has reconfirmed its commitment to SAP, and that is something we are very grateful for and we really appreciate that. In EMEA, [Commercebank] [Inaudible] [Allan Pope] Enterprise – that is a large Russian company -- the Ukrainian Ministry of Defense, Océ Technologies -- highly competitive bids against the number two of this industry. [Saberbann] System [Informatione] that’s a Safe Passage deal; and of course Telefonica. In Asia Pacific, [Anshon] Iron and Steel, China MinMetals also very competitive deal, ([Melian Bank], [Noritsu] Company in Japan, Reliance Communications in India the Water Corporation in India as well. If I look at the software revenues by region for the half year, the Americas did really well and grew 31%, or 25% in constant currency of which the US contributed 20% growth and 17% in currency-adjusted figures. APA 5%, but if I exclude Japan from APA that actually is 13% and 10%. Japan has a small decline, but Q2 showed some good news. EMEA, 4% and Germany despite the World Cup -- or maybe because of the World Cup -- grew by 8%. Let’s take a deeper dive into the regions. The Americas in the first half year, let me just put things back into perspective for everyone. The US has now delivered 12 consecutive quarters of double-digit growth, that is quite an achievement. In fact, if I look at the average growth rate over the last 12 quarters, the US had a 34% average growth rate over these 12 quarters, which I think is quite an achievement. The Americas region continues to be a key growth driver for us, and the growth rate of the region was 31%, 25% at constant currencies. We are the clear market leader in North America, but also in the US, and I am very happy also to see that our mid-market performance in the US is picking up full steam and is going strongly forward. In Europe, a highly heterogeneous region as you all know. We had actually solid performance. Just to put things into perspective here as well, we generate in Europe about 3.5 times more software licensed revenues than the number two and that on a rolling four-quarter basis. We had very strong performance in Russia, very strong performance in France, good results in Germany, good results in Switzerland, good performance in Nordic in the half year, good performance in the Netherlands. We had some challenges, but you have heard this from other companies as well in some other parts in Europe. The UK was slightly below the average, so was Italy and so was Nigeria. Asia Pacific, we continue to do a great job in penetrating the growth markets in Asia Pacific, particularly in China and India. We usually don’t disclose the exact numbers there, but just to give an indication, in countries such as India and China, our growth rates are either big double-digit, and in one of the two cases actually triple-digits. In Japan, the situation is still a bit of a challenge but we have some good news. Q2 actually showed a stabilization, if not a rebound, with 4% growth in constant currency and we feel confident that that trend will continue like this in that very important country. We have made quite some changes there and we feel a lot better about Japan than we did before. Just to conclude and to remind you what our priorities are for the remainder of the year, we want to extend our leadership both in the core enterprise application market, but also in our focus industries the ones I have mentioned earlier on. We will continue to push very hard on the small and mid-sized enterprise segments, expanding the channel giving us better go-to-market capabilities. We are continuing to boost and to strengthen our Partner Ecosystem which we feel is very important for our short and medium-term performance. We will expand our leadership in the platform markets and we will continue to focus on the business user, thanks to SAP Analytics , or [duet] offer and CRM on demand. We actually feel that we have a very good global enterprise offering going forward. We have probably the best balanced regional distribution of all companies and our high growth markets are gaining greater and greater prominence in our country mix. This being said I would like to turn it over to Henning. Thank you very much.

Good morning ladies and gentlemen. I was asked several times these days if the business environment has changed and so I didn’t feel so from my thoughts, but we checked with Leo and the regional presidents and I can confirm again it hasn’t changed. People questioned this morning in the TV about some of the results of European vendors, particular business upticks and others but again, I think Europe is as it was before. So you should not expect any macro economic environment changes here. On the other side if you look to our customers I think how they make their decisions is also the same, you know that every customer these days want to avoid risk. So from that point of use switching vendors isn’t that easy and therefore I am pretty happy to see that our Safe Passage program is taking off, adding another 70 cases in the second quarter and accelerating in pace. They make their decisions based on business cases, that’s a reason why our win rate is still very high. We win in 70% of the cases where we compete head-to-head to our competition. They look for long-term strategic relationships and that’s the reason why Leo and this team have now for some time engaged in these type of negotiations he explained. I think this type of deals can only be made with key customers that have a large footprint of SAP as the trusted vendor for a long time What about price pressure? Yeah, it’s the same thing. You know we are in a highly competitive environment so price is one of the weapons competition is taking and we have to adjust to this, but it’s not getting really worse. It’s what we know and what affects us in our guidance. Last but not least sometimes questions about our enterprise SOA roadmap: will SAP deliver on time, what about the speed, and I can just confirm we are on track here as well. Just to highlight, we have at SAPPHIRE announced the general availability of the first services-enabled ERP suite earlier than some people expected, the response was extremely positive. I have reconfirmed that we will evolve NetWeaver at the end of the year into a business process platform. Now what about the guidance from my side? Let me reiterate there are good reasons why SAP is always giving an annual outlook. We were pressured several times to change it to quarterly ones, but you know our seasonality and I think if you look in our past it is good to give a yearly one and we stick to this. On the other side I think we are giving ranges, we are giving you several guidance, we are giving ranges and please understand that gives us the flexibility we need. So you should not expect at the end of the day all figures to be at the same area of the range, some can be at the higher end, some can be at the lower end. That gives us this type of flexibility. If you take this into consideration I think you can adjust your models. You will see that our guidance is consistent. So where are we today? We are today at this 13% product revenue growth. Our operating margin went up 60 basis points, EPS grew by 30%, and that was a base why we said overall we are within our targeted range and we could reiterate our full year out, but that’s the base. You know that we made two assumptions at the beginning of the year. We said this is based on the assumption of certain software revenue growth, but I also want to highlight that we made a change at the beginning of the year that we said we guide on product first, for good reasons. We have seen one of the explanation from Leon. Nevertheless, we feel comfortable on software as well. I think we are a little bit below expectations, but on the other side if you look to the order entry you see that we have not lost deals, and I think we can catch up here as well. Finally, we want to exclude currency fluctuation, I think that’s something we can’t manage, therefore we have given you a base on which our guidance is based beginning of the year this 123. For your information what we had in the first, second quarter. You see currency was in favor in the first; was against us in the second, but overall for the half year it was more or less in line with what we expected. If that continues it is okay, if it changes dramatically please have in mind that this is part of our guidance. Now is there a switch in priorities because SAP did so well on the margin in the second quarter? Do we not invest any longer? The answer is no. We continue to invest, as I said, otherwise we couldn’t deliver on the enterprise services architecture road map. We added 1,800 people, many, many of them in research and development. Again you see the areas of investments, you also see that most of them are now in the market, so we can deliver on time. I explained already that some of those will be shipped at the end of the year. There is no delay. There is no indication for a delay. We will ship according to plans. ERP, and in particular NetWeaver were well received in the market. In particular that we have such a strong acceptance of ERP as one of the for me proof points of SAP NetWeaver because it’s a success -- you know how conservative clients are and they wouldn’t accept ERP if they wouldn’t trust NetWeaver. Last but not least, customer satisfaction at an all-time high. It hasn’t changed on the highest level even in the second quarter, not only in the first one. All-in-all, this is the market share. You can see two things. We have continued to gain market share, but you see that our competition has gained more in the second quarter, so we lost some people share as you could calculate yourself. Overall if I look to the picture and if I take into considerations that we have not spent 20 billion, I feel pretty comfortable with this picture and I think if we look again some time from now, you will see that our strategy is a superior one. With that I would like to guide you through our strategy again. It’s not something new, but I think it’s important that I confirm that we have not changed our direction. First of all, you know this is our strategy. This strategy is different to that of our competition. It’s based on organic growth, on innovation, and I just want to give you only a few highlights what we have done in the first half year in order to work on this strategy and make it happen. Let’s start with our product roadmap. This is a slide I have shown at SAPPHIRE. I just want to reconfirm, no changes. We have set 2006 a cornerstone year for the completion of the road map. This availability of ERP 2005 was a very important milestone for us, its more than people originally though, which is in ERP 2005 its really entirely services enabled, its ready to run with all the new product in combination. It’s a lot of functional enhancements and the upgrade is prudent and easy. I will not go through the rest its exactly the same slide I have shown, no changes here. A few data points rounded. If you want to measure how was the acceptance in market of this new architecture and everybody is interested. I personally measure it in these four categories. The first is how are we doing with NetWeaver? I have given you the software revenue in the first half. Roughly 20% is standalone, rest is application related. You see that we’ve more than 30,000 installation on components. We have roughly if you ask how many times is NetWeaver installed as a platform, between 8,000 and 9,000 times. ERP on track with the conversions, so we’ll again convert this year between 801,000 contracts. We have today 4,600 ERP customers that’s ERP 2004 and ERP 2005 together. What about the service enablement? 500 enterprise services are available in Q3, we believe we can deliver 1,000 at the end of the year, so you see that every quarter some of them will be added and 1,000 is already at the higher end of what we want to achieve. xApps is the last one, the composites how many xApps are there. This is just SAP. SAP xApps we have now 800 customers, 100 references and at the end of the year we will end up with 150. So that gives you a feeling on where we are. Now what about these co-innovations? Where are we? Again, two sides of the coin. One, we promised to work together with key companies in order to deliver products based on enterprise service architecture. Just going through them you know that we deliver Duet, it’s a joint product with Microsoft, its in ramp up, I expect in the third quarter that it will be generally available. Now with Adobe interactive forms we have shown the accelerator for business intelligence. That’s is something which is extremely important if you can achieve the effect of 100 times faster response time on queries in cooperation with Intel, HP, IBM, and with EMC. We are working with CISCO on this application with the networks. If you look to the ISVs I have taken this type of parameter to show you from the bottom to the top what we are doing. Yes our developers are working with NetWeaver to develop a network that is now 5,000 participants. On top are those that work with NetWeaver. This is one of the lowest ways to integrate some of the products with NetWeaver, it is now 1,200. Partners then are seeing a stronger relationship with those who work on NetWeaver so they could use products that run on NetWeaver – on NetWeaver 450, then we have 35 -- this is an adjusted composite, this is a composite that are using already the services we are releasing. Some couldn’t start on that early. I think now its between 11 or 12 but I think we will make 50 at the end of the year. Last but not least the highest way of cooperation is that we invite our key clients in selected industries, with key partners in selected industries and jointly find out, what are white spots we have to fill? Some of these are high-tech consumer package group, public sector; five are done already, more will come. It shows you little bit where we are and what type of partnerships we are after Now, yes we are doing acquisition as well, but we are not doing acquisitions in order to buy customers, it’s more to accelerate the completion of our product portfolio. Just a few of them we did in the past, I don’t want to go into the details. The last one was Praxis, a very small one, but it helped us to add to our Business One product, which is now more then 10,000 clients, e-commerce functionalities. What you can see here is that in nearly all cases with two exceptions, it’s entirely complementary. In two cases we have 10% overlap, so more or less we are, if we are acquiring complementary products and technology. Platform strategy, again no changes, you know we are after one central enterprise service repository, one language, one set of enterprise services for small companies implementation is on Business One. Business One is not on NetWeaver, but is using the same language in order to integrate more companies. For medium it will be a different implementation, as we said, and therefore we have seen in our roadmap that we will bring at the end of the year mySAP All-in-One on NetWeaver. If you look to large ones, I have shown already that ERP 2005 is a base on which we will evolve into this platform. So, therefore if you would ask what’s available today, this is the picture we show to our clients, we show here is the integration on the three layers of people, process and data. The process with this NetWeaver composition platform. People, you see the different user experience is SAP is running on the same layer of intelligence, on the same business rules. We have added just recently this project views, I would say its an alternative to the SAP GUI, it is very appreciated by our clients; it could be the browser, which is a portal et cetera. We could access through Office with Duet. Last but not least also something that is happening on the data layer and I will remind you again that in particular if it comes to query, to decision making, the myAccelerator its a very important thing. It is an in-memory database. So finally, again no changes at the end of the year. NetWeaver which is a composition platform today, will evolve into a business process platform, we will add selected reusable process components to this technology platform and we will continue to evolve the technical capabilities. Finally it’s a business process platform; it’s a base for us for the next generation of business application. I highlighted a little bit to which full potential we can go with that. That brings me to reiterating the slide I have shown at the beginning of the year this is our ambition 2010. I have explained why 2006 is important for us, I will again reiterate we will complete our roadmap next year; no changes, but we have to look ahead at what’s beyond and therefore we have told you that our goal is to expand the addressable market in this three areas to 2010 to 70 billion. We expect that 50% of our revenues at the time of our software revenues will come from these new products. We are targeting for more then 100,000 customers. This is not too ambitious, if you look to the acceleration of the Business One, I think more then 50% will be Business One out of these. So, it could also be more then 100,000 and therefore 40% to 45% of our revenue will come from what we call the silicon market. Thank you very much. Stefan Gruber: Thank you very much. At this time we would like to start the Q&A session. I have to mention for those of you who follow this conference through the Internet who are not in the room here in New York, you can send questions by e-mail to investor@sap.com. We will also try to take a couple of questions we get by e-mail, but I think we start here in the room first. Let’s see one here on the right hand side Charlie di Bona. Charlie di Bono – Sanford Bernstein: Thank you; Charlie di Bona with Sanford Bernstein. Werner, as your business model is sort of moving towards more roadmap type of deals where you have more of these stage deals, and the order entry becomes increasingly important; can you give us some idea of the size of the orders that are entered but not yet pushed on to the balance sheet? Sort of what Microsoft calls booked but not billed balances? Will you be giving us some idea of the trend lines that you see in that, because it seems to be very important in terms of modeling the company going forward?

If you look back the last 12 quarters you will always see that we have slightly higher order entry then we have recognized revenue. We have some quarters where this has size which is exceptionally high as we had in the second quarter. We don’t see an extraordinary trend now starting, but that’s something we have to keep in mind. We decided to highlight this, especially this quarter, because it had an impact on our financial performance on the license side. Charlie di Bona - Sanford Bernstein: Can you give us an idea of the size, you have the size of the balance that’s currently not on the balance sheet and not pushed yet through recognized revenue. I mean is this a multibillion dollar balance, is it?

No, not at all. If you go back to the example I made for the second quarter, you see 100 million in order entry and 30 million in revenue recognized; that’s the amount we are carrying forward and not more. We normally close deals where we have a chance to recognize revenue, but there are some where we have order entry first and then the revenue is lagging behind it. Henning?

I can add something. What you are referring to is what we had seen where we had this subscription deal and then we had deferred income and you saw this on our balance sheet. That’s not what we are pointing to. At the end of the day, you have the order book filled, but you cannot recognize because you don’t have it in the balance sheet. Why have we highlighted to this quarter? It was interesting, we are not talking about it, we will not show you, but it’s interesting -- if you look to the deals of Q2 last year and this year and you look to all the large deals and we were surprised to see less booked from the larger one, that was different I think in previous sections. So from that point of view it’s getting more of those. In the past we had it, but we had I would say one deal in a year and then the next year, another one. Now you see more, several in the quarter. That’s a point of view, and we gave you an indication if we compare order entry to order entry. Not order entry to software, Q2-Q2, then you would see us in the range you expect for software. Charlie di Bona - Sanford Bernstein: Do you expect that pattern to continue as these become a bigger part of your order flow?

I personally expect it a little bit because first of all Leo is doing this as part of his business model and he explained to you why he did it. The second point is honestly, from the top of the Company was always behind, not let’s say to take the future of the Company to today’s results. From that point of view I am always behind, if a larger deals I think our regional president are phasing them. So I am not pushing them in the opposite. Stefan Gruber: The next question is from the Kash Rangan. Kash Rangan – Merrill Lynch: Thank you. Kash Rangan from Merrill Lynch. Just curious what seems to be a little bit of an uptick in the trend towards these larger deals being broken up into smaller pieces, would this not be an opportunity to reset guidance for the year and lower the risk profile on the stock? Just curious what your thoughts are there on that front? Secondly, it looks like we look at the operating expenses, you maybe slowed down hiring or you are starting to get productivity from the previous investments. How should we think about operating expenses going forward, especially as lot of the work with BPT is behind us? Thank you.

Thank you. I think as a first comment, that it is too early. I think there is no indication for us to do it now. Second question, we will not change in the ways that we would compromise on investments just boosting the operating margin. I tried to say it in my talk. It looks like this. It’s not. I think it was more a shift between the quarters, as we pointed out in our call, we had a little bit of front-loaded investments this year, and if you look to the half year, it’s exactly what we waned to achieve, but a little bit more at the beginning of the second. So you saw this, for you, disappointing margin at the beginning and a better one in the second. Therefore, I said look a little bit more not quarter to quarter, we managed the year. But the clear answer, we will not compromise on let’s say our products, on the go to market and what we have to do just in order to please the margin. I said this last year and if we would see that we could gain market share by accelerating our investment, we would come and we would discusses with you or would announce with you whatever. We would not surprise anybody, but I just wanted to say from the tendency, let’s say investing into the future is still priority number one. Kash Rangan – Merrill Lynch: This hasn’t changed?

It has not changed. Stefan Gruber: A question here with Rick Sherlund.

Thank you. Couple of questions, first just to follow up on Charlie’s question on just how unusual was this in Q2 in terms of order entry versus recognized revenue? It sounds like this is something we’re going to see more over in the future. Should we anticipate this in Q3 and Q4 or just give us some perspective of how unusual perhaps this might have been in Q2?

Let me try to answer that question. What you see happening is a very interesting evolution of the business. You see on the one hand that our volume business continues to perform really well, which give us a stronger and stronger underpinning, if you want, of a nice flow of income and revenues that come from a pure volume side of the business. When you look at larger deals, because of the roadmap delivery were we stand right now we have an opportunity to structure the relationship with a number of very large customers who want to actually plan their own future, if you want, ahead of time as well in a reasonably innovative and smart way that is beneficial for them and for us. Now I don’t think we should talk about trends yet, because I don’t’ think that two or three deals are trends. You have our commitment that should this become a trend we’ll most certainly notify the market and yourselves. At this moment in time I think its little bit too early to do that, but what I think we you should expect is that these one or two that we have seen in the first half will continue. We believe that there is a potential for these deals. It’s extremely difficult to predict that they will close in Q3 or Q4 or whatever, because it is a long-term negotiation, a long-term discussion, it requires very careful branding, you have to really draw the roadmap for the customer and this is not just some general PowerPoint that you draw out of your drawer. But, it is a huge mark of confidence of our customers into our strategy. It helps us to deliver the value over time and therefore it’s something we should and that we will pursue. But, I don’t think we should go into big discussions about trends, because it’s too early to talk about.

The magnitude in the quarter then in revenues was enormous.

The magnitude, the size of them was a bit abnormal in Q2.

Let me clarify one thing -- it is good to have a strong order entry, but it doesn’t mean that we do not stick to the guidance on the product or software license side, that’s I think important to mention. Leo Apotheker: I have also one thing. I think its also important to understand why we can't book those deals. You might let’s say question why some competition can book those deals. In our case we have to understand what we want to do, we want to help our customers strategically to go to the next level. So, what we do is we engage and say, look, join us on the roadmap to enterprise service architecture that makes you more competitive. If you do this it’s an entirely different thing than saying, okay I confirm that I maintain you for the next years. In our case you sell a little bit to future, in the other cases you sell a little bit yesterday’s products, and we don’t want this. So, from that point of view we are taking risks that we have, to some extent, valuable deal which you can't book according to your schedule because it’s in the interest of our clients at least. This case for SAP clients this is now the step to the next level and these I think strategic deals are key to engage with the clients. Because they will say, okay, we trust you, but is this really the one, it’s a longer roadmap, and do you help me? Can I get everything you invent in the next years as well? This is the most strategic issue. It’s not just confirming and protecting --

In fact just to add, we are not selling software. We’re selling a holistic IT strategy and holistic IT solution, a holistic IT implementation and we are actually selling or we’re partnering with the customer to implement our joint vision of how their business will look like over the next five years.

Could you just go back and revisit the maintenance decline and expand a little bit on that issue? Finally on the EPS number, we have the benefit of the tax rate. Why isn’t that additive to the full year number?

Some maintenance amount in the EPS -- I also look to the maintenance. It’s a clear thing. If you see it in [inaudible] there are two implications you want to see what's behind. So first of all the good new is we are not losing customers, we are not losing customers. That was my first belief; that’s not the case. It’s a mix of several things. In some cases it’s mergers/acquisitions. So it’s just to merger, you lose some maintenance. In some cases it can happen that a customer has bought something where he felt he bought too much. He comes back and said okay will I ever use this? You engage and say okay fine give it away and then the maintenance lowers, those types of things. Sometimes a customer’s into financial trouble and you help him a little bit, that is the main reasons; all of them are not particular. What I really can confirm is this is not because we are losing customers. We are not. The growth of the maintenance for the full year is also in line with our product related guidance if I look to the guidance on the [inaudible] items, I think this was your question Rick. I think when we provided the guidance we provided a range of €0.20 and 580 to 6. I think the one-time effect we saw in the second quarter is roughly €30 million as I said; this is €0.10. From my perspective, this is within the range we provided at beginning of the year. Stefan Gruber: Thank you. There was in the mean time a question from the web again on the maintenance topic we have addressed already. Again if you want to send us questions by email continue to do so to investor@sap.com. In the meantime we take a question here from the room, I think the first row. Art Weiss - Germany: Thank you. Art Weiss, Germany. I have a question – actually two about the enterprise service-oriented architecture. If one of you can explain a little bit how this concept and this strategy is linked to the facts and figures? In other words, how much software revenue already can you link to these strategies, to this new concept? How would this percentage be in the future let’s say for the rest of the year, for next year? The second question, your strategy is looking more toward the small and medium sized market, and how does this fit to the enterprise service-oriented architecture? To me it looks more as the solution for the big ones and not for the small ones.

That’s a very good question and indeed it depends on the definition. I will be more conservative. Then I would say, today it’s not much of our revenue, because we are on the roadmap. I could be bullish and say everything, which was NetWeaver and ERP is already in; but, if I am very strict on my definition, I would say only those where we have really service-enablement, which would mean for SAP today is mySAP ERP 2005 sales I would put into this pocket. We haven't done it so far. We have looked for ERP, CRM, et cetera, but its a good indication. I can promise that beginning next year we will give you guidance on this, because its in our interest as well. It’s important because next year we can then give you also an indication who is taking this faster? Is it larger enterprise or is it the mid-market? Because we address both with different products. I would say during this year or next year we will have these products available so therefore it makes sense to show it. Now to your question, is it only something for the high end? Answer is no for two reasons. If you look to large enterprises, it helps them to master heterogeneity and the speed of change. We all understand this. It is a complex environment you want to replace pieces without changing the rest, you want to adopt fast, all those stories fit nicely. Now, the question is what about the mid-market? In the mid-market you could argue, first of all they change fast as well, so that fits. But, on the other side the mid-market is not yet complex, they want the solution more or less out of the box. Here, this strategy helps us to go to market with mass customization. So, I would say nearly 1,000 of pre-configured solutions which would lower the price for implementation of TCO significantly for the mid-market, but still having the same functionality and benefit as the high-end. So I would say for them it’s more an indirect use and the last one I would mention it helps them also to integrate very quickly into the business of large ones or mid-sized ones, but our customer normally is large enterprises. Now is the question, okay how fast are you to integrate into your business? The faster and the more seamless, so more business you are make in the future, these are the benefits we sell to mid-market. Stefan Gruber: Thank you. Before we take another question here from the room there is a question from the web, obviously on the accelerated share buybacks in the first half. The question is what do you expect in terms of share buybacks in the second half of 2006?

I think we will continue to buyback share, but not accelerated as we did in the first half of the year. Remember, when we provided our EPS guidance at the beginning of the year, we said it is based on roughly 307 million shares outstanding. We are now on an average basis at this amount but this doesn’t mean that it will continue. So we will continue to buy back shares in the second half, but not at the same pace as you saw in the first half of the year. Stefan Gruber: Thank you and we take a question from the room; John McPeake. John McPeake - Prudential: If I look at the GEA and also your -- at least this June quarter -- the increased booking versus recognition; should I think about the ratio of license to maintenance changing on a recognized amount per dollar deal?

I don’t think you should. The maintenance is, as you know, a percentage of the license therefore there is a correlation when you book the license you book the maintenance. These ratios are what they are, and it is percentage driven so there shouldn’t be any change. John McPeake - Prudential: Okay, it is just that existing maintenance payments become part of the GEA when you sign them.

Yes, in the case of a GEA the situation is slightly different. You sign an overall agreement for 100; as your book is going forward in those hundreds you have the entire transaction. So you also have maintenance included in there. John McPeake - Prudential: So per $100 of deal size you are still going to have the same ratio there won’t be coming and goings?

Yes. Stefan Gruber: Thank you. And another question here I think in the back; Peter Kuper. Peter Kuper – Morgan Stanley: Hi, thanks. Peter Kuper with Morgan Stanley. Earlier this week your friends at Oracle were saying that Fusion has tremendous advantages over let’s say NetWeaver on a [inaudible] type strategy. If you could share with us maybe just general comments on that; but also what customers that are believing in your vision see as advantageous over Oracle Fusion please?

Yes, thank you I have not seen this presentation, I would love to; but it can send it to me and then we can give more detailed answers. At the end of the day, I think my first answer is always that people or customers in SAP can touch what we are doing. So, we are not only talking about it, we have not only shipped NetWeaver, but we have also shipped products on it. So, if you look for example, to the year ERP 2005 it’s a services-enabled ERP. So, we would argue we are the same from our competitors and how does it work, what does it mean, how does it work. What I have seen some times is that they claim SAP is not following standards, SAP is using old technology and those types of things. The answer is first of all we are using standards, we are pretty open and otherwise how could we cooperate nicely with Microsoft and IBM platforms? The other point is always about what is the standard? My answer is always for me its more about giving choice to clients than declaring something I like as a standard and try to persuade others that these are the standard. So, from that point of view we are giving choice. If a client, for example, wants to extend in Java he can do it; he will not see other things we have in our environment. If a large client of SAP likes [inaudible] he can still use us; we will not take it away from the market. If clients likes the Microsoft environments they can use us; otherwise we couldn’t have built Duet. So you’ve seen our approach. We will not be religious on standards, we are looking at what our key clients want and we give them choice. From that point of view I feel pretty comfortable. There is another point I would highlight is, if you look to the concepts of the business process platform as a combination of reusable applications of technology and the concepts behind model-driven are not only services-enabled, but also event driven et cetera; I think you’ll find all to modern concepts people are highlighting today. I don’t know one which is missing, but we can debate it in detail. Leo Apotheker: I will add one very pragmatic point to what was just said. When I look at what’s happening in the markets with customers, than let’s eliminate from the discussion for a second SAP Fusion, or all Fusion customers, because they have predetermined choices. Let’s look at situations were both of us are present and a company needs to make decision about the future. So, therefore this people will have to make a wise choice between two strategies, two approaches, two technologies and architecture is very important part of it. And without revealing names, because I can’t, I can assure you that there have been a number of these situations over the last three or four months, all of which have been won SAP. After a solo investigation of the customer of Fusion versus our strategy, versus NetWeaver, and they could touch NetWeaver, -- it’s hard to touch PowerPoint -- and they looked at the ESA roadmap, they looked at what we are able to deliver and the conclusion was fairly straightforward. Stefan Gruber: Thank you. There is another question from that web. Do you see a shift in seasonality for the remaining quarters in second half?

What we see is -- and you find this out yourself -- if you look to the result of the first half and to the guidance that there will be a slight shift between first half and second half. It’s not fundamental, it might be a percentage or so, 1% or 2%, but I think within the quarter we have no ideas that there will be a shift. Stefan Gruber: Thank you. A question in the room, I think in the last row. Diana Hynd - Managing Automation Magazine: Hi, Diana Hynd from Managing Automation Magazine. What percentage of the current ERP customers do you expect to be on the new platform by the end of the year? What will that customer base look like in terms of the current version and the new version?

Well, we already gave some guidance in the past about a number of contracts still outstanding and our aspiration to make sure that by 2010 all of these contracts would have been migrated to the latest versions of ERP. Having already indicated that we made ERP 2005 generally available this year, a few months ago, its having huge success so by definition all of the customers who are buying it now are using it. The upgrade is continuing smoothly. We have a program in place to help our customers upgrade to ERP 2005. There are a number of efforts underway. But on the other hand, we also have a very clear and transparent maintenance strategy. So if a customer has for whatever reason an internal reason why he needs to stay on a prior release for a year longer, we will of course maintain that customer as well. But its going as planned. Its actually doing really well and we have no reason to believe, actually we have every reason to believe that by 2010 our objective will be fully achieved, maybe even a little bit soon. Stefan Gruber: Thank you. Are there any further questions here in the room? Right here, there. Can we have a microphone here? Okay.

I just curious in the SOA strategy, what your plans for an Enterprise Service Bus are and how you are approaching that functionality? My other question is regarding, we talked a lot about the order entry, but there were two other reasons: one was the multiple years, we talked about that; the third was that some transactions were expected to close in first half are now closing in the second half. Can you give us some breakdown of what those three were and what was behind the third bullet point?

Well, maybe start with the last question and first. If you create two buckets, the enterprise deals, the phased deals et cetera, versus the deals that slipped, it’s about two-thirds, one third; and the one-third of the deals that slipped, I won’t disclose to you all of the names, they happened all over the globe: Latin America, EMEA, Asia and here in the US. We are confident that all of this deals will close in the second half of the year. Leo Apotheker: You have seen that there will be an important next step in NetWeaver, which we call evolvement into a business process platform where more technology is coming and in particular more enterprise services, more composition things. If you look to this version, then the answers you will find that’s a kind of a [inaudible] for enterprise services in ESA; , not today because today we are just setting the enterprise services. So, therefore whenever you see that SAP, let’s say is talking then about NetWeaver evolving into business process platform, that is also meaning that this is a next version of NetWeaver; technically and from a content point of view. Then these pieces will be addressed. We have said that this will be done at the end of the year. So we will start with ramp up in next year and that’s the reason I expect that it’s next year, generally available. And if you look to the end of the roadmap, we said okay we take this version and put it also under the Suite; and then we said okay, we have completed the roadmap. Does this mean that we have done everything which was possible for enterprise services? No, it’s like the techniques are out, it is feasible, customers can take it; and then as always the market will come and ask for a lot of features and function extensions. But it’s important then you have I would say a complete package and product you can sell; if you bring ERP or CRM or whatever to the market. In the next years people ask for a different function that year. Stefan Gruber: Thank you, there is a question here on the right hand side.

Question, I think you mentioned that your win ratio is 70% I am right?

Yes.

In this case, what’s the numerator? Is it new greenfield where by you and maybe all of your competitors go after this account? Or is it a case whereby Brand X tries and displaces an existing account or you would try to displace Brand X in another account? And in some cases, is it just one product or a whole suite? I am not too clear exactly how you classified the win ratio. Leo Apotheker: Let me try to explain this. What we measure is all of the competitors situations, all of the situations where we are competing. Otherwise it would not be a win rate if we are not competing against anyone; you can only do it against yourself, which would be embarrassing. So win rates, so the only measure of the situation where we are having competition either against one or several competitors and that’s something we track, of course, in a very careful way. So all of the cases you mentioned are included in there, there can be other situations as well. It can be a public tender for example, where you might already have some software but someone else has some software as well. So as a greenfield it is not – you can’t really categorize it like that. But all possible situations are included and therefore it’s a very important indicator for us because it helps us track how we are doing competitively. We track it by the way not just globally, we track it of course in every country, every region, every industry, every market segment.

One last question, what impact will the World Cup have on your quarterly results?

What impact did Oracle have in our quarterly?

The World Cup.

If you look at our win rate, if the win rate stays stable then the impact doesn’t change.

No, what I am saying is that given that the global impact of the World Cup -- people were watching...

The World Cup?

Does it mean that it might have caused some customers to postpone their purchases?

You know, when you buy enterprise software, there is a pretty complex and strategic process. Even if you watch a game overnight, you can still function during the day.

Thank you. Stefan Gruber: Thank you. Are they any further questions? I see one here in the back rows.

Thanks. Just two questions on Safe Passage. It seems to be going well, but the run rate isn’t really picking up that quickly and I just was curious -- maybe I am wrong -- I am curious if you expect to see a tipping point at some point where you actually aggressively incent the sales force to go after those customers? Secondly, could you just talk about the scale of those customers you’re wining back? I mean are you actually wining back, real embedded Peoplesoft accounts or does it tend to be accounts that are still shared with SAP? Thanks.

Far for me to ever say that you are wrong, but your interpretation can be articulated differently. Safe Passage is actually gaining significant speed. The growth rates are picking up very nicely, not only the growth but also the pipeline. So, from that perspective we are very happy. We will fine tune Safe Passage and we hope that we will be able to announce Version 2 of Safe Passage in the month of September. We always want to make the program even better and we will work on that and we will release that. I don’t need to incent anyone on Safe Passage. Everyone is motivated to make it happen anyway. So, I have never met an AE in SAP who is not very, very keen to make sure that another Safe Passage deal happens. Last but not least, to the profile of the customers. You will understand that a certain number of customers do not choose to be named for good reasons, why they are transiting from an Oracle world to an SAP world. I can assure you that a certain number of customers who made the decision were very large -- I mean very large. Entrenched Oracle customers, some of them are Oracle, some of them are PeopleSoft, some of them are JDE, some of them are a combination of all of the above, who have decided to migrate to an SAP strategy. We are very happy about that. These are sophisticated situations, they require our best commitments, they require our best efforts and now we are actually implementing already a certainly number of those. A few of these deals happened in Q4, a few of them happened in Q1. Sooner or later I am sure that your sources will reveal who they are. Stefan Gruber: Thank you, another question right here.

I have two questions. First, are there any circumstances under which the order entry cannot be recognized into revenue? Can you give us the status on the premium maintenance product that you are introducing? Leo Apotheker: Normally it comes back as revenue and there is one caveat; it might not come back as software revenue, it could come back as consulting maintenance or other type of revenue. But in general I would say it comes back as revenue.

Premium maintenance is something that we launched in the beginning of the year. We are now actually offering this to an increasing number of customers. It is slowly picking up and I think we should give it the time to be accepted in the market and be rolled out. But I am sure that we will see this trend of premium maintenance increase quarter after quarter. Stefan Gruber: Okay, given the fact we have already discussed for now nearly 90 minutes, I think this closes today’s conference. Thank you very much for all your questions. Our next event is the Q3 earnings announcement on October 19. Thank you very much.