They’re not going to invest heavily into the technology migration. They need to be able to do so in a rapid way. And so the GROW offering has been really successful in markets like North America. And at the upper end, we always recognize that even in the best of times, but right now, they’re taking multiyear major investment journeys with us. So the way that the market is working there is — the question is not if they move to RISE, it’s how and when — and that program. And that’s where we see those large bookings. So look, it continues to be a market we’re highly competitive and high expectations. But we remain strong in the foundation of what we deliver to around the world is equally is true in North America. Christian, if you want to add.
Christian Klein: Well said, Scott. I mean, maybe just one point more. I mean the transactional business of Concur, Fieldglass and Ariba is, of course, also the dominant share is in the United States as these companies also were founded and have most of their customer base there. So — and as Dominik also outlined, to be seen, how business develops in Q4 but I was just last week in SAP Spend Connect. And when I remember it back in three years ago, these products were completely different products and different legacy stacks on different platforms. And when you see now our intelligence spend portfolio and you just look at Source to Pay, you wouldn’t even see which product is it. It’s all about the end-to-end business process. It’s a beautiful UX.
The team did a wonderful job. And of course, there is now some macroeconomic headwind to be seen how this will develop in Q4 on — for next year and for the years to come, I feel much better from a product experience perspective than where we have been three years ago.
Kirk Materne: Thanks very much for the color. Helpful.
Anthony Coletta: Thanks, Kirk. And we’ll take the next question, please.
Operator: The next question comes from the line of James Goodman with Barclays Capital. Please go ahead.
James Goodman: Thanks for taking mine. I wanted to ask you just on the implied guidance also a bit around the revenues ex cloud. I think like EBIT, it looks pretty conservative throughout the range. I mean, even taking into account the comments that you’ve made around the anticipated Q4 license trajectory. So maintenance has been down, I think, 1% only three quarters in a row. Why should we see that certainly sort of decelerating in Q4? And maybe you can extend the answer to some commentary around maintenance for next year. I think we’ve now seen that you can raise prices up to 5% next year. So should that offer sufficient support to maintenance to keep a sort of similar trajectory? Thank you.
Dominik Asam: Yes. I think the key point is not really the maintenance, but as you say, the licenses where there’s more volatility. And yeah, we have been prudent on that front. Q4 is, by far, the biggest quarter in that context. I think it’s not wise to extrapolate Q1, Q3 into Q4. I think it also gives us an opportunity to send a clear signal that there is commercial discipline on these license deals because our strategic trajectory is towards the cloud. And this is why I think this assumption makes sense. Now again, it’s notoriously difficult to predict. So there can be a wide range of outcomes around that kind of range I have alluded to. And this is why we kept the range quite open on that front.
Christian Klein: Yeah. And on cloud revenue, I mean, I also remember, I mean we have put out there a 2025 guidance three years ago, and we weren’t aware around what exactly will happen during COVID. We, of course, have not foreseen the exit of Russia. Now we are talking about a high inflation environment and some macroeconomic challenges and still we keep our 2025 guidance. And so I’m actually very happy with the underlying strength of our portfolio. But again, also to be seen how Q4 will now develop from a transactional revenue standpoint. But I find it remarkable the underlying strength of the portfolio despite all of these headwinds, what we have seen over the last years, I have to say. I mean, Russia, there will not be a comeback and still we are maintaining our guidance for 2025.
James Goodman: Thank you.
Anthony Coletta: Thank you, James. Next question please. The next question is from the line of Michael J. Briest with UBS Limited. Please go ahead.
Michael J. Briest: Yes. Good evening. And my congratulations as well for the momentum. Maybe a little teaser on next year. I mean, your revenue outlook is driven by the cloud, it’s pretty predictable and hopefully and fairly linear. The maintenance, you’ve given clear sort of indication on 2025. Is there any reason we shouldn’t think that profit and cash flow grow in a fairly linear progression between here and 2025? Is there any factors we should be thinking about that mean that that’s unlikely to be the case? And then around stock-based compensation, I noticed that the charge increased a little bit at the low end. And I know you’re thinking internally about how you treat that going forward. Is there any more light you can shed on whether that’s still a charge that should be treated as an exceptional item in your view? Or maybe it’s now a more predictable number and something you can bring into the adjusted margin? Thank you.
Dominik Asam: Well, maybe I will have a stab at the 2024, first, as a reminder, we guide 2024 and January of 2024. So we have an ambition for ’25. And if you think about what are the priorities in the current planning process, which will then, of course, drive the budget for 2024, I’d say it’s, of course, derisking 2025 to make sure that it’s really solid and deliver to that ambition. And secondly, I think we will also start to put more focus on the question, how can we kind of boost earnings growth beyond 2025. It’s all nice to think about 2025, but the future is actually in the second half of the decade. And please bear with us until that kind of date in January when we have matured that planning process to really give you then a solid guidance for the year. I don’t want to kind of preempt that at this point of the year.
Christian Klein: Yes. And then to add to Dominik point, I mean, Q4 is also in the cloud, our biggest quarter from an order entry perspective, and that really can also create really still some swing on the cloud revenue one way for next year. And so yeah, more news to come in January.
Dominik Asam: So now on the second point, I have noted charge. So that was — sorry, can you just help me out on that…
Michael J. Briest: The charge, I think…
Dominik Asam: Is stock based.
Michael J. Briest: Increased a little bit at the low end.
