SAP completes 2020 picture, and 2021 outlook The main piece of new information in Friday''s full Q4 results was the cash flow outlook for EUR4.5bn+, down from EUR6bn in 2020. Despite SAP offloading the Qualtrics cash settled stock comp as part of the IPO, SAP is still guiding for EUR2.0-2.5bn of stock comp in 2021, up from EUR1.1bn in 2020 and EUR1.8bn in 2019. In addition, capex may rise after having fallen from EUR1.5bn in 2018 to EUR0.8bn in 2019 and 2020. With guidance for falling operating profit and FCF in 2021, on flattish revenues, we expect the shares to remain range-bound, especially as cloud revenue growth may fall further y/y in Q1, and FX headwinds will intensify as well. SAP begins to provide additional detail around business model transition At its Q3''20 warning, SAP announced it was accelerating its cloud transition, which would lead to a rapid decline in its license sales, and the beginning of maintenance revenue declines, but details remained vague. SAP''s RISE event last week outlined its new ''concierge service'' cloud offering, and SAP is beginning to provide information around potential cloud revenue drivers. For example, SAP expects its maintenance revenue to convert into 2x cloud revenues, and SAP sees a EUR10bn infrastructure as a service opportunity annually for SAP''s existing on premise footprint. However, the timing and mechanics of the transition remain unknown, and investors will be concerned that SAP is simply now re-selling hyperscale infrastructure, while taking on more execution risk by managing customers'' cloud transitions. However, the payoff for SAP will come in accelerated S4 Hana upgrades, and the cross selling of SAP''s vast cloud apps portfolio, eventually driving double digit group revenue growth. We expect more disclosure as part of the Q1 results. Awaiting more details from our meetings with management this week We will host SAP CFO Luka Mucic and new Head of Customer Success Scott Russell this week...