What is Billings?
Billings is a core concept in modern B2B revenue. Here is a clear, accurate definition, why it matters, and how Ardovo handles it.
Short answer
Billings are the total amount a company has invoiced customers in a period, regardless of when the revenue is recognized. Billings can differ from bookings and revenue because of billing schedules: a customer may commit to a year but be invoiced quarterly. Billings closely track the cash a business will collect.
Key takeaways
- Total amount invoiced to customers in a period.
- Driven by billing schedules, not contract signing.
- Differs from bookings and recognized revenue.
- A leading indicator of upcoming cash collection.
Why it matters
Billings sit between bookings and cash. They show what you are actually invoicing now, which helps forecast collections and working capital more accurately than bookings alone.
How Ardovo handles it
Ardovo links billing schedules to each deal so billings, bookings, and recognized revenue all reconcile. Rook can flag when scheduled billings diverge from expectations, a sign of a billing or collection issue.
Frequently asked questions
What is the difference between billings and bookings?
Bookings are the total value a customer commits to when signing. Billings are what you actually invoice, which follows the billing schedule. A one-year deal billed quarterly books fully but bills in four parts.
Why do investors watch billings?
Billings often lead revenue and cash, so growth in billings can signal future revenue growth before it shows up in recognized revenue. It is a useful forward indicator for subscription businesses.