Net income for the most recently ended year was $8.9 million, off 31 percent from $12.9 million. But QAD will stick with the move to the cloud. "We have a focus on increasing subscriptions even at the expense of licenses and maintenance," CEO Karl Lopker said during the company's recent earnings webcast. Subscription revenue rose 37.5 percent to $38.8 million, versus $28.2 million, while license revenue fell 36.8 percent to $29.9 million, from $40.9 million. The company was hurt by a slowing manufacturing environment, with the decline in oil prices hurting many companies but helping QAD's automotive sector. Lopker says most new customers are looking at cloud products and two-third of cloud customers are new companies or new divisions to QAD software. President Pam Lopker said QAD is improving both cloud margins and SLAs with less than 20 minutes downtime per month, compared to a typical contracted three hours 39 minutes. Meanwhile, in May, QAD will unveil its Channel Island Project at its Explore customer conference, which includes a new architecture and user experience.
CLOUD TAKES TOLL ON QAD Featured
The switch to the cloud, combined with the impact of currency changes, cut a swath through the QAD revenue line for the year ended January 31. The impact of the stronger dollar chopped $19.9 million from fiscal 2016 revenue. And so revenue fell to $277.9 million for the most recently ended year, down 5.8 percent from $295.1 million for fiscal 2105. On a constant currency basis, revenue was up 1 percent.