Metrics & Performance
Backlog
In SaaS, the total value of contracted but not yet recognized revenue — a leading indicator of future ARR growth.
Backlog in a SaaS context refers to contracted revenue that hasn't yet been recognized. When an enterprise customer signs a 3-year contract, the entire contract value may be 'backlog' while revenue is recognized monthly over the contract term. A strong and growing backlog is a highly positive indicator for a SaaS company's future ARR — it represents revenue visibility that reduces forecasting uncertainty. Investors look at backlog alongside ARR, NRR, and pipeline to assess the health and predictability of a SaaS revenue model. Companies with large backlogs (relative to current ARR) can make more confident hiring and investment decisions.