RE:RE:GRN revenuetonyxdsun wrote: This is not true.
The correct math is:
Current backlog = q2 backlog + q3 sales contract - q3 revenue (recognized)
DDT980 wrote: Over the last 5 qtrs.GRN has consistently reported an average backlog of about $40 million. They have also said that contracts take 3 to 5 qtrs to for the total revenue to be recognized. The math is simple. Even if the backlog stays at $40 million, the annual steady state revenue will be 4 x $40 million.
tonyxdsun: You are showing the calculation for current backlog, while DDT908 was trying to calculate revenue from historical/forward backlog. So you aren't correcting his calculation - even though his is meaningless.
DDT980: examples of different backlogs without a corresponding change in revenue, based on 4 quarters to complete a sale.
example 1) steady state backlog of 40 million but new orders crash to 1 million and so does revenue for 1 quarter. Notice that the next 4 quarters will show revenue of 13 mil$, but backlog stayed the same for each quarter.
example 2) The boss comes back from a long holiday and kicks butt, getting 20 mil$more than average booked orders completed from over 6 months ago, but the sales force brings in 60 mil$ in new sales. The average backlog remains the same, but revenue show will increase for the next year.
Revenue cannot be calculated from average backlog. Revenue can only be generated by getting backlog (booked orders) out the door.