Operating income of $1.1 million was wiped out by $1.2 million in tax expense as the company recognized taxes during the quarter because it expects a breakeven year. Subscription revenue reached $17.2 million, up 25.5 percent from $13.7 million in last year's corresponding period. License revenue also increased, rising 25.8 percent to $6.6 million a year earlier. CEO Karl Lopker said the growth in license income was driven by expanded buying by the installed base. Conversions from on premise to cloud were more than half of cloud bookings and the company added 18 cloud customers during the quarter. Cloud prospects represent more than 60 percent of the funnel. President Pam Lopker said although many consultants believe the cloud is for small companies, QAD continues to see businesses with thousands of users moving to the cloud. During the quarter, the company received an order from a $25 billion consumer product company, which had been a QAD on-premise for more than a decade.