# TCV vs ACV: SaaS Sales Math (with Examples and Pitfalls)

DevFeed: [TCV vs ACV: SaaS Sales Math (with Examples and Pitfalls)](<https://devfeed.tech/articles/tcv-vs-acv-saas-sales-math-with-examples-and-pitfalls-10419.md>)

Original publisher: [Read original article](<https://dodopayments.com/blogs/tcv-vs-acv-saas-sales-math/>)

Author: Aarthi Poonia

Published: 2026-06-08T00:00:00Z

Content type: tutorial

Language: en

Sources: [Dodo Payments Blog](<https://devfeed.tech/sources/dodo-payments-blog.md>)

Topics: [Software as a service](<https://devfeed.tech/topics/saas.md>), [Finance](<https://devfeed.tech/topics/finance.md>)

Tags: [examples](<https://devfeed.tech/tags/examples.md>), [guide](<https://devfeed.tech/tags/guide.md>), [metric](<https://devfeed.tech/tags/metric.md>), [metrics](<https://devfeed.tech/tags/metrics.md>), [pitfalls](<https://devfeed.tech/tags/pitfalls.md>), [saas](<https://devfeed.tech/tags/saas.md>), [saas-finance](<https://devfeed.tech/tags/saas-finance.md>), [sales](<https://devfeed.tech/tags/sales.md>)

## AI overview

This guide explains Total Contract Value (TCV) and Annual Contract Value (ACV), including their formulas, worked examples, and differences across single-year, multi-year, ramped-pricing, and auto-renewing contracts. It highlights how confusing the metrics can distort pipeline reporting, commissions, and ARR reporting.

## Source excerpt

TCV vs ACV explained for SaaS founders. Definitions, when to use each metric, common pitfalls, and how multi-year contracts complicate the picture.