By Dan Gallagher

Some cloud software customers aren't paying their bills. Investors don't seem to mind.

The latest round of quarterly reports in the past two months confirmed that the sharp economic hit from the coronavirus pandemic has forced some companies to seek extensions or new terms to their software contracts. This has affected companies ranging from small to gigantic. Oracle on Tuesday reported a "drop-off in deals" and delays in customer payments for its fiscal fourth quarter ended May 31. The fiscal quarter's timing gave the company the largest exposure among its peers to the pandemic-related shutdowns that began in early March.

Yet cloud software stocks continue to rage. At least 15 have jumped more than 20% in just the past month. The BVP Nasdaq Emerging Cloud Index has hopped by 13%, exceeding the Nasdaq Composite's 10% climb in that time. Ensuing valuation multiples stand out even in a market becoming well accustomed to froth. Four cloud software stocks -- Zoom Video, Shopify, Datadog and Coupa Software -- now fetch more than 30 times forward revenue, which is 10 times the Nasdaq's average multiple even with that broad-based index having just hit a new record high.

The continued gains are predicated on the belief that any business disruptions will be temporary. Over the past several years, cloud software providers have benefited from businesses large and small moving from older, legacy systems that were expensive to install and operate and less flexible to boot. That trend should continue even with the pandemic's impact. In fact, the flexibility of cloud offerings is a plus in a world in which more companies will need to accommodate remote workers.

But the health of cloud businesses may get harder for investors to measure. Billings has long been the preferred method as it takes into account changes in deferred revenue and is considered a more forward-looking measure than reported revenue. But delayed payments will hurt deferred revenue. Slack Technologies Chief Financial Officer Allen Shim told analysts on his company's June 4 call to "expect calculated billings to be less useful as a measure of underlying growth during the Covid-19 crisis."

It also will impact cash flow -- another important measure. Workday ceased cash flow projections for the fiscal year ending in January, citing requests from some customers for "flexible billing terms." Adobe, which noted an "increase in customer requests for billing concessions" in its call last week, also suspended its projections for the fiscal year ending in November.

The impact could last a while. Bernstein analyst Mark Moerdler says the cloud industry has spent the past decade shifting to longer, multiyear contracts paid annually in advance. In a note last month, he said, "We would not be surprised to see a shift back to bi-annual, quarterly or monthly contracts," which would decrease deferred revenue and free cash flow in the short term. He recommends that cloud companies become more transparent in areas such as average contract terms.

But companies themselves might not feel a need to shed more light on their business as long as investors are content to race ahead in the dark.

Write to Dan Gallagher at dan.gallagher@wsj.com