Hi @u6032171 - You can do this! I do it often. Try changing the order in which you make your adjustments.

With image.png in Files, rename the image2.png to image.png on your desktop (or housed folder on your PC/device). Then, open Files. Drag and drop or upload that newly named image.png in the same folder as your original file. You'll see a window pop up asking you if you want to rename or replace the original file with this new file. If you say Replace, it will apply the change to every place in your course where the original one was embedded. It's awesome and can save a lot of time! ✨