In line with the emerging market trend, binding durations and values in new contracts are decreasing while frame agreements provide revenue opportunities. This market change is affecting both the order backlog and Total Contract Value, but has no impact on the market growth outlook. If the average contract duration had remained unchanged, Tieto’s book-to-bill would be 0.2 higher than the reported figure (rolling 12 months compared with the base line in 2015).
Total Contract Value (TCV) amounted to EUR 1 575 (1 669) million and book-to-bill stood at 1.0 (1.1).
The order backlog continues to be healthy and amounted to EUR 1 860 (1 847) million. Of the backlog, 52% (49) is expected to be invoiced during 2018, representing annualized revenue value of EUR 974 (913) million for 2018.
The total value, including the part beyond the notice period and estimation related to consumption-based contracts, is included in the TCV. Order backlog includes all signed customer orders that have not been recognized as revenue, including the estimates of the value of consumption-based contracts.