Bookings

Bookings are a commitment from a customer to spend money with a company over a specified contract term. It is recorded when a customer signs an agreement, representing the total contract value (TCV) of new business, renewals, and upsells closed within a given period. This metric is one of the most important financial KPIs for SaaS and other subscription-based businesses, as it provides a strong signal of future revenue streams.

Bookings are a foundational input for financial forecasting and capacity planning. Understanding the pipeline of committed business allows finance and operational teams to plan resources, manage cash flow, and set realistic growth targets. Tracking bookings helps leadership gauge the effectiveness of sales and marketing efforts and provides an early view of the company's financial health.

It is crucial to distinguish between bookings, revenue, and billings. A booking is the commitment, billings are the invoices sent to the customer, and revenue is earned and recognized only as the service is actually provided to the customer over the contract period.