Definition

Deferred revenue.

Cash or bookings already received for items whose revenue has not yet been recognised — the bridge between bookings and reported revenue.

When a player buys a durable virtual item, the company has received the money but may recognise the revenue gradually over the estimated period the player benefits. The unrecognised part sits on the balance sheet as deferred revenue.

The change in deferred revenue explains most of the gap between bookings and revenue in a period. It is not a quality verdict by itself: rising deferred revenue can simply mean current spending is ahead of what accounting has recognised so far.

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