Book to Bill Ratio

The Book-to-Bill Ratio is a financial metric that compares the value of new orders received (bookings) by a company to the value of goods shipped or services delivered (billings) in the same period. A ratio above 1 indicates that demand is outpacing supply, suggesting positive future revenue growth. A ratio below 1 signals that orders are lagging behind deliveries, which may foreshadow a revenue slowdown. The metric is widely used in capital goods, semiconductor, and defence sectors to gauge near-term demand visibility.