Reported Revenue PressureThe shift from on‑premises to hosted licenses reduces reported software revenue due to changed recognition patterns, pressuring headline financial results.
Revenue Recognition TimingMoving from upfront on‑premise deals to hosted software defers revenue recognition, which can make reported revenues look weaker even if customer demand remains stable.
Risk Of Shortfalls Versus ExpectationsAn accelerated transition to hosted licenses could create a shortfall in reported software revenue relative to expectations before subscription recognition normalizes, raising the risk of negative estimate revisions.