======Billings======
Billings represent the total value of invoices a company sends to its customers during a specific period for services rendered or products delivered. It's a crucial metric, especially for subscription-based businesses, because it captures the total contractual commitment from customers in a period, regardless of when that money is actually "earned" as revenue. Think of it this way: when you pay for a full year's software subscription in January, the company //bills// you for the whole amount then. However, according to [[accounting principles]], it can only recognize that payment as [[Revenue]] on its [[Income Statement]] month by month as it provides the service. Billings, therefore, offer a sneak peek into a company's future revenue pipeline. It's the total value of new business, renewals, and upgrades invoiced in a quarter or year, making it a powerful forward-looking indicator of a company’s sales momentum and overall financial health.
===== Why Billings Matter to Investors =====
For an investor, particularly one with a long-term perspective, billings can be more insightful than revenue alone. While revenue tells you what a company //has earned// in the past, billings tell you what it //expects to earn// in the future. It's a direct measure of new business being signed.