The total amount you have invoiced customers over a period, regardless of when that revenue is recognised.
Billings ≈ recognised revenue in period + change in deferred revenue
You recognise £100,000 of revenue in a quarter, and deferred revenue rises from £40,000 to £70,000 as customers prepay annual plans.
£100,000 + (£70,000 − £40,000) = £130,000 in billings for the quarter
Billings measure what you actually invoiced in a period. Unlike bookings, which record the full committed value of a contract at signing, billings capture money as it is invoiced — which for an annual contract billed upfront means the whole year lands in one period, while a monthly contract bills a twelfth at a time.
Billings sit between bookings and recognised revenue, and they are the closest of the three to cash. A common shortcut estimates billings from the income statement as revenue for the period plus the change in deferred revenue, since cash collected ahead of delivery shows up as deferred revenue on the balance sheet.
Billings matter most for cash flow. A business selling annual contracts upfront collects a year of cash on day one, which is why annual billing is such a powerful lever for runway — the same revenue, recognised identically, but the cash arrives far sooner.
Billings are the bridge between signed deals and cash in the bank. Tracking them shows how quickly commitments convert to invoices and collectible cash, and the choice between monthly and annual billing is one of the biggest levers a SaaS has over its own runway.
No fixed benchmark applies; billings are read against bookings and revenue. A high share of annual upfront billing strengthens cash flow and lengthens runway, which is why many SaaS incentivise annual plans with a discount.
Billings is what you invoiced; revenue is what you earned. Bill an annual contract upfront and you record a full year of billings at once, but you recognise the revenue evenly across the twelve months as you deliver the service.
Annual upfront billing front-loads cash: you collect twelve months at signing, so billings spike while revenue is still recognised monthly. The difference shows up as deferred revenue on the balance sheet.
Bookings record the full committed value of a contract when it is signed; billings record only what has been invoiced so far. A multi-year booking turns into billings gradually as each invoice is raised.
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