Strong H1''24 de-risks FY EBIT outlook, with underlying FCF upgrades encouraging Following our Q2 First Take here we update estimates post-Q2 and emphasise 1) 9-14% upgrades to our underlying FCF estimates FY24-25 with updated FCF analysis within, 2) continued upside to FY24 / 25 adj. EBIT guidance (even after the FY25 raise). We believe H1''24 indicates strong cost discipline ahead of restructuring benefits still to come and de-risks FY24, hints at upside to FY25 while the underlying FCF upgrades in the revised guidance point to improved cash conversion already that should be sustained in years to come and provide upside to FCF guidance too. KPIs and commentary highlight SAP''s relative resilience in the face of market uncertainty While acknowledging challenging sector dynamics SAP''s unwavering demand-related commentary in tandem with the better than expected Q2 CCB print indicated no signs of macro / end market softness, highlighting SAP''s relative resilience owing to its multi-year product upgrade cycle. Furthermore GenAI demand is booming: 1-in-5 Q2 deals including Premium AI use cases with 60 available ytd and 100 by year-end as the growing partner ecosystem scales up. Raising TP to EUR240 / $260 ADR on continued upgrades and execution We update estimates with negligible changes to Revenue, EPS but more notable FCF upgrades following Q2 developments mentioned above. We raise our TP to EUR240 / US ADR to $260 (from EUR225 / $241) using our Global Software Valuation Framework (unchanged approach) with our TP implying 1.6x ''PEG'' P/E to EPS CAGR (inc SBC), broadly in line with current Enterprise Software PEG valuations. SAP shares have performed well ytd (+41% vs. IGV Software ETF +6%) but we see upgrades to Co. guidance and Consensus estimates as well as continued execution to support the re-rating driving the shares from here. Reiterate Outperform and European Software Top Pick.