K3 reported H116 results in line with management expectations. Revenue growth was limited by currency and the shift to consumption-based licensing, but adjusted operating profit increased 25% y-o-y with margin expansion to 12.2%. Good progress has been made with the strategy to increase own-IP software sales, build out the reseller channel and grow the hosting business, although the impact of the shift to consumption-based licensing leads us to reduce our revenue and EPS estimates.