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What is the difference between Recurring Revenue and Total Revenue?
by Wooden (2,800 points) | 3 views

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Investors more highly value companies where the majority of total revenue comes from product revenue (vs. from services). Why? Services revenue is non-recurring, has much lower margins, and is less scalable. Product revenue is the what you generate from the sale of the software or product itself.

Total revenue is the sum of:

  1. Once off revenue (services or product)
  2. Recurring revenue e.g. monthly/annual subscriptions
So recurring revenue is a component of total revenue.

by Wooden (2,800 points)

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