Deferred Revenue Ratio

Calculate the deferred revenue ratio, an efficiency ratio that measures the size of a company’s deferred revenue (payments collected for goods or services not yet delivered) relative to its revenue.

This ratio is a common leading indicator for subscription and SaaS businesses, where a growing deferred revenue balance relative to revenue can signal accelerating future revenue recognition.

The formula is as follows:

Also known as: deferred revenue intensity, unearned revenue ratio.

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Calculate the Deferred Revenue Ratio in Python

The Deferred Revenue Ratio is available in the Ratios module of the open-source Finance Toolkit. Install it with:

pip install financetoolkit -U

Then call get_deferred_revenue_ratio as shown below.

from financetoolkit import Toolkit

toolkit = Toolkit(["AAPL", "TSLA"], api_key="FINANCIAL_MODELING_PREP_KEY")

deferred_revenue_ratios = toolkit.ratios.get_deferred_revenue_ratio()

Which returns:

Parameters

get_deferred_revenue_ratio accepts the following parameters:

• rounding (int, optional): The number of decimals to round the results to. Defaults to 4.
• growth (bool, optional): Whether to calculate the growth of the ratios. Defaults to False.
• lag (int | str, optional): The lag to use for the growth calculation. Defaults to 1.
• standardize (bool, optional): Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False.
• trailing (int): Defines whether to select a trailing period. E.g. when selecting 4 with quarterly data, the TTM is calculated.

Related Efficiency Ratios

The Ratios module page introduces the module, and the sidebar lists all of its functions.