Splunk (SPLK), an analytics and security firm, is transitioning primarily to a cloud services delivery model. The transition is happening more rapidly than Splunk originally expected. Longer term, the company’s revenue will be more predictable once the transition is complete. However, as a greater percentage of sales are recognized ratably, Splunk’s near term prospects have been lumpy and plagued by lower than expected operating margins.

In its latest 10-Q, Splunk disclosed another change that will negatively impact operating results in the year ahead:

“We have also shifted from generally invoicing our multi-year contracts upfront to invoicing on an annual basis. Accordingly, we have seen the timing of our cash collections extend over a longer period of time with the transition to a subscription model than it has historically, and we expect this to negatively impact operating cash flows through at least fiscal 2022.”