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:
\[\text{Deferred Revenue Ratio} = \text{Deferred Revenue} / \text{Revenue}\]Also known as: deferred revenue intensity, unearned revenue ratio.
Deferred Revenue Ratio in Python
Install the Finance Toolkit 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:
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| AAPL | 0.0208 | 0.0201 | 0.021 | 0.0211 | 0.0218 |
| TSLA | 0.0441 | 0.0345 | 0.0386 | 0.0426 | 0.0361 |
Parameters
The function 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.