The TOP clause is applied after the entire source table and the entire target table are joined and the joined rows that do not qualify for an insert, update, or delete action are removed. The TOP clause further reduces the number of joined rows to the specified value and the insert, update, or delete actions are applied to the remaining joined rows in an unordered fashion. That is, there is no order in which the rows are distributed among the actions defined in the WHEN clauses. For example, specifying TOP (10) affects 10 rows; of these rows, 7 may be updated and 3 inserted, or 1 may be deleted, 5 updated, and 4 inserted and so on.

Does anyone know if there is any predictable order that the Merge statement will apply inserts and updates? I assumed that it would apply them in the order listed in the WHEN clauses, e.g. WHEN NOT MATCHED THEN INSERT followed by WHEN MATCHED THEN UPDATE would result in inserts first, then updates.