You can also upgrade an appliance in VMware virtual environment by binding the downloaded .iso image as a virtual CD drive.
From the inventory, right-click the virtual appliance that you want to upgrade and select Edit Settings to open Virtual Machine Properties.
From the Hardware tab, select CD/DVD drive 1 → Datastore ISO.
Browse to the .iso file.
(Optional) Select Connect At Power On to connect the device when the virtual machine turns on.
Click OK.
From the appliance console menu, select Reboot to restart the system.
Select the full installation mode, which is the default and the recommended option.
Follow the on-screen instructions to reimage the appliance and configure the appliance from the Setup Wizard.