Expansion Revenue
Definition
Additional recurring revenue earned from existing customers through upgrades, add-ons or increased usage. It is a key driver of net revenue retention and efficient growth.
Related Terms in Financial Analysis
Bookings vs Revenue
Bookings are the value of contracts customers commit to; revenue is what is actually recognised as earned over time. The gap matters because a signed deal is not the same as recognised income.
Deferred Revenue (SaaS)
Payments received in advance for software or services not yet delivered, recorded as a liability and recognised as revenue over the subscription period. It is central to subscription accounting.
Weighted Average Cost of Capital (WACC)
The average rate a business pays to finance its assets, weighting the cost of equity and the cost of debt by their share of total capital. It is the common benchmark return used to evaluate investments.
Cost of Equity
The return shareholders require for investing in a business, reflecting its risk. It is a key input to WACC and to valuing a company's equity.
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