Bookings vs billings

What is bookings vs billings?

Bookings are the total value of contracts customers commit to; billings are what you actually invoice them in a period. Bookings capture future promises, billings capture near-term cash. The gap between them shows how much committed revenue is still waiting to be invoiced and collected.

Why it matters for fast-growing companies

Confusing these two is a classic cash-flow trap: a record bookings quarter can coincide with thin billings if deals are billed monthly or annually in arrears. Founders should watch billings and deferred revenue for the cash reality, and bookings for the growth story. They answer different questions.

Related terms

• SaaS metricsTotal contract value (TCV)TCV is the full value of a customer contract over its entire term, including recurring subscription fees plus any one-time charges like setup or onboarding.
• SaaS metricsAnnual contract value (ACV)ACV is the revenue a customer contract is worth over one year, normalized to an annual figure.
• Accounting & closeDeferred revenueDeferred revenue is a liability representing cash collected before the product or service has been delivered.
• Accounting & closeAccounts payable vs receivableAccounts payable (AP) is money your startup owes suppliers and vendors, recorded as a liability.

Frequently asked questions