Silicon AnalyticaGlossary · Business & metrics
What is the book-to-bill ratio?
The book-to-bill ratio compares the value of new orders received (bookings) with the value of products shipped and billed in the same period. A ratio above 1 means orders are arriving faster than the company is shipping.
Why it matters for investors
It is a common leading indicator for equipment makers and component suppliers, since orders received today become revenue in later quarters.
Some companies do not report bookings, and orders for very expensive tools can be uneven, so a single quarter’s ratio can mislead without context.
Key companies
Related terms
General educational explanation. Information only, not investment advice.