"We are pushing a little bit more for partners to do services, partially because of our backlog," CEO Karl Lopker said in a recent earnings webcast. He added those sought after partners "are not necessarily the big guys" because larger companies are more interested in working with SAP or Oracle. The story of QAD's results continued to be the impact of the cloud. Because license sales declined and cloud revenues are deferred, there continues to be financial pressure. CFO Daniel Lender noted that "There will continue to be challenges to the bottom line" and that maintenance dollars will likely decrease. For the year, QAD lost $15.5 million as it recognized a valuation allowance for deferred tax assets. That compared to net income of $4.1 million for fiscal 2016. It also reported operating income of $3.4 million for 2017, down sharply from $10.2 million the prior year. Annual revenue of nearly $278 million was only $121,000 higher than in 2016. Reflecting cloud sales, the only revenue category to rise was subscriptions, which came in at $52.2 million, an increase of 34.4 percent from $38.8 million. The advent of cloud products will likely change the mix of services partners provide. "Our goal is to have no customizations," said President Pam Lopker. She continued that will be accomplished by enabling changes to be made "in the data as opposed to in the code", which means upgrades should be easily performed.