Bookings

What are Bookings?

Bookings represent the total value of opportunities which were successfully closed won during a specific period. Basically, they are the value of additional revenue which can come from new business (NB) or from renewal and expansion opportunities.

Why are Bookings important?

Increasing revenues is perhaps the most important goal for any business. SaaS businesses must be especially aware of the amount and the source of their revenues, ARR in particular. Bookings are the simple answer to the question “how much revenue is the company successfully generating?” It is critical to monitor this metric in order to understand the top-line results that the company is achieving and to react accordingly. Using different filters and breakdowns makes it easier to identify the types and amount of revenue generated per region, segment or product, and act to remedy any deficiencies and leverage strong performance.

How are Bookings calculated?

Bookings are as simple to calculate as they are important to measure. The total value of bookings is produced by summing the amount of all opportunities that were closed won in the period. Bookings can be measured according to the number of won deals (count), the amount of total contract value (TCV) or the amount of Annual Recurring Revenue (ARR) of these opportunities.

Formula

Bookings = ∑ (Closed-Won Opportunities)