revenue variance

Revenue variance measures the difference between the actual income a business earns and the income it expected to earn based on its budget or forecast. If actual revenue is higher than expected, there’s a positive variance, indicating better-than-expected performance. If it’s lower, there’s a negative variance, showing the business earned less than planned. Analyzing revenue variance helps identify which areas are performing well or underperforming, guiding decision-making to improve future financial results. It provides insight into the effectiveness of sales, marketing, and pricing strategies, helping stakeholders understand the reasons behind revenue fluctuations.