Market data on why usage-based and hybrid billing have become an increasingly prevalent revenue model for modern software companies
The usage-based billing market is growing quickly. A market report updated in March 2026 projects the cross-industry usage-based billing market to grow from $9.4 billion in 2025 to $28.6 billion by 2034. That estimate spans telecom, utilities, finance, healthcare, and SaaS rather than SaaS alone, so it should be read as evidence of broad consumption-pricing momentum rather than a SaaS-only valuation. For companies operating complex consumption pricing, a purpose-built usage-based billing engine is important infrastructure: Orb ingests granular raw usage events, calculates charges, generates invoices, and maintains auditable records of changes and corrections.
Key takeaways
- Market growth is accelerating: The cross-industry usage-based billing market is projected to expand at a 13.2% CAGR from 2026 to 2034, creating demand for billing infrastructure built for metered consumption
- Adoption is broadening quickly: More than 59% of SaaS businesses implemented usage-based pricing structures in 2025, compared with nearly 40% in 2023
- A growth premium was measured in Q2 2024: SaaS adviser Todd Gardner reported median Q2 2024 year-over-year growth of 25% for a hand-classified group of predominantly usage-based public SaaS companies, versus 13% for subscription companies; the complete comparison dataset and calculations are not published
- Variable pricing models outpaced subscriptions on growth in High Alpha's benchmark: Consumption-based pricing companies grew 43% year over year, hybrid companies grew 40%, and subscription companies grew 34%; hybrid pricing had the highest NRR at 105%
- Cloud deployment dominates: Cloud-based billing solutions captured 67.8% of cross-industry usage-based billing market revenue in 2025; Dataintelo also reports average cloud implementation timelines were approximately 40% shorter than comparable on-premises deployments
- Enterprise revenue is concentrated: Large enterprises accounted for 63.7% of usage-based billing market revenue in 2025, a revenue share rather than a share of deployments
The rise of usage-based billing as a major revenue model
The shift from purely fixed subscriptions toward metered and hybrid pricing is one of the more significant changes in SaaS monetization. The data below ties each figure to its source and states its scope. It shows substantial adoption and market growth, with hybrid models performing especially well.
1. Cross-industry usage-based billing market projected to reach $28.6 billion by 2034
The usage-based billing market is valued at $9.4 billion in 2025 and expected to reach $28.6 billion by 2034, according to a report updated in March 2026. The measured market is cross-industry, covering telecom, utilities, SaaS, finance, and healthcare.
2. Market expanding at a 13.2% compound annual growth rate
Dataintelo projects a 13.2% CAGR for usage-based billing from 2026 through 2034. This is a cross-industry growth rate covering telecom, utilities, finance, healthcare, and SaaS rather than a SaaS-only figure.
3. Cloud billing market forecast to nearly double by 2031
The broader cloud billing market is estimated at $15.83 billion in 2026, growing to $30.64 billion by 2031 at a 14.12% CAGR. Within the report's billing-model segmentation, usage-based billing is projected to grow at a 15.34% CAGR.
4. SaaS adoption of usage-based pricing passed 59% in 2025
More than 59% of SaaS businesses implemented usage-based pricing structures in 2025, compared with nearly 40% in 2023, according to a 2026 market report. The public methodology page does not disclose enough detail to independently reproduce this percentage, so it should be treated as a publisher estimate. That trajectory shows consumption pricing moving from experiment to mainstream practice within two years.
5. 44% of B2B software providers have adopted hybrid pricing
Business Research Insights estimates that 44% of B2B software providers adopted hybrid pricing combining fixed subscriptions with usage billing. Hybrid structures let companies keep predictable committed revenue while capturing expansion from consumption.
6. 61% of publicly traded SaaS companies offer at least one usage-based tier
More than 61% of publicly traded SaaS companies offered at least one usage-based pricing tier in 2025. The publisher does not expose full methodology on its public page, so this figure is best treated as a publisher estimate.
7. Software accounted for 61.3% of market revenue
The software component of usage-based billing captured 61.3% of market revenue in 2025. This is the software-versus-services split of a cross-industry market, measured as a share of revenue rather than a share of customers or deployments.
Impact of usage-based billing on engineering efficiency and time savings
Building and maintaining metering, rating, and invoicing logic in-house consumes engineering capacity that would otherwise go into the product. Orb's billing engine handles granular usage metering and invoice generation, reducing the billing infrastructure teams must maintain themselves.
8. Vercel cut billing build and launch time by 80%
Vercel decreased the time required to build and launch billing for new products by 80% after adopting Orb. The reported result specifically measures the workflow for building and launching billing for new products. The case study describes Vercel offloading usage-data infrastructure instead of maintaining pre-aggregation pipelines in house.
9. Cloud deployment cuts implementation time by 40%
Dataintelo reports that cloud-based billing implementation timelines are 40% shorter than comparable on-premises deployments, measured across the broader usage-based billing market. Faster implementation lets teams launch new pricing without long development cycles.
10. 65% of organizations had at least implemented order-to-cash automation
APQC's 2025 finance-automation research found a 65% implementation rate for organizations that had at least implemented order-to-cash automation. APQC surveyed 2,500 finance leaders and defines "at least implemented" as organizations in the implementing, operating, or operating at scale and optimizing stages.
11. Customer invoicing appeared at 74% among common order-to-cash automation applications
In APQC's 2025 finance-automation research, customer invoicing at 74% was the most common order-to-cash application listed. This percentage should not be interpreted as meaning that 74% of all invoicing tasks were automated. Separately, Orb Simulations lets teams compare pricing scenarios and model financial outcomes using real product usage data before a change goes live.
12. Automation respondents reported a median 25% improvement in order-to-cash accuracy and quality
APQC's 2025 finance-automation research found that respondents reported a median 25% improvement in order-to-cash accuracy and quality.
Operational efficiency statistics: streamlining billing workflows
Beyond engineering time, consumption billing platforms change how finance and revenue operations teams spend their days.
13. Stytch reduced billing and invoicing time by 75%
Stytch reduced time spent processing bills and invoicing by 75%. Separately, Orb's finance workflows cover CRM contract mapping, revenue recognition reporting, AR aging and dunning workflows, ERP integrations, and maintained product and revenue data history.
14. 57% of venture-backed SaaS startups adopt usage pricing within 24 months
Business Research Insights estimates that approximately 57% of venture-backed SaaS startups implemented usage-based pricing within their first 24 months. Early adoption means metering accuracy becomes a foundational requirement rather than a later migration project.
15. Industry estimates put billing-related revenue leakage at 3% to 7%
Dataintelo cites industry estimates suggesting that inadequate billing systems can cost organizations 3% to 7% of potential revenue through metering inaccuracies and manual reconciliation. The page does not disclose the underlying study or sample, and the estimate is not SaaS-specific. On the recovery side, Orb's collections automation applies automated reminders, retries, and collections workflows to reduce failed payments.
16. 45% of vendors launched usage-aware pricing recommendation engines
Approximately 45% of vendors launched pricing-recommendation engines that adjust plans based on usage behavior. Orb Price Evolution supports pricing experimentation, customer-specific rollouts, and auditable price changes. Orb's versioned billing architecture preserves a traceable history of pricing changes and how each invoice was generated.
17. 38% of leading vendors shipped advanced usage-based billing capabilities in 2025
During 2025, 38% of leading vendors launched advanced usage-based billing capabilities. Advanced usage-based billing capabilities are becoming more common among billing vendors.
18. SaaS providers generated 22.4% of usage-based billing market revenue
SaaS providers represented 22.4% of usage-based billing market revenue in 2025. This is the SaaS end-user share of a cross-industry market, a different breakdown from the 61.3% software component figure above, and it shows that SaaS is one of several verticals driving metered billing alongside telecom, utilities, and financial services.
The link between usage-based billing and revenue growth
Variable pricing models are associated with strong growth in High Alpha's benchmark, while hybrid pricing had the strongest net revenue retention. The widely quoted Q2 2024 growth comparison also deserves careful attribution.
19. One analysis measured 25% median growth versus 13% in Q2 2024
SaaS adviser Todd Gardner reported median Q2 2024 year-over-year growth of 25% for a hand-classified group of predominantly usage-based public SaaS companies, versus 13% for subscription companies. Gardner published the usage-based cohort and a methodology summary, but not the complete comparison dataset or calculations, so the figures describe Q2 2024 rather than current growth rates.
20. Consumption-based pricing companies grew 43% year over year
Consumption-based pricing companies in High Alpha's 2025 SaaS Benchmarks grew 43% year over year. In the same benchmark, outcome-based pricing companies grew 65%, hybrid companies grew 40%, and subscription companies grew 34%.
21. Hybrid pricing produced 105% net revenue retention in High Alpha's benchmark
Hybrid pricing produced 105% NRR in High Alpha's 2025 SaaS Benchmarks, versus 102% for subscription pricing, 100% for outcome-based pricing, and 99% for consumption-based pricing. Hybrid had the highest net revenue retention among the four pricing models reported in that benchmark.
22. 61% of U.S. digital subscription companies moved to hybrid billing in 2025
In 2025, 61% of U.S. digital subscription companies expanded into hybrid models combining recurring and metered billing. Within that publisher estimate, running both models side by side is common, which places a premium on billing systems that can price a committed subscription and metered consumption on the same invoice.
23. Replit shortened product launch timelines and kept pricing flexible
With Orb, Replit reduced the time required to launch a new product and could make pricing changes until the last minute, including one made a week before launch. Teams evaluating a pricing change can model outcomes first with Orb Simulations, which runs scenarios against real usage data.
Enhancing customer experience and transparency with usage-based billing
Consumption pricing works best when customers can see and trust what they are being charged. Transparency is an infrastructure problem before it is a messaging problem.
24. Spend on consumption-priced SaaS tools can vary by as much as 37.6% month to month
Vertice reports that spend on consumption-priced SaaS tools can vary by as much as 37.6% month to month. Vertice says its 2026 pricing insights are derived from more than $75 billion of global processed spend.
25. LaunchDarkly cut usage display delay from as much as eight hours to seconds
LaunchDarkly reduced the delay in displaying usage from as much as eight hours to seconds, while gaining a more transparent and auditable billing foundation that supports its self-serve segment. As separate capabilities, Orb's experience kit provides customer-facing dashboards, pricing calculators, and draft invoices, and Orb's spend controls add real-time monitoring, alerts, and spend thresholds.
26. 52% of software providers introduced hybrid billing systems
Fifty-two percent of software providers introduced hybrid billing systems combining recurring subscriptions with metered consumption.
Processing scale: handling high-volume usage-based invoicing
As consumption grows, billing infrastructure has to keep pace without degrading accuracy or close timelines.
27. Supabase processes over 1.5 million invoices monthly
Supabase processes over 1.5 million invoices per month through Orb, an indication of the scale high-growth usage-based businesses now require.
28. Usage-metered cloud billing forecast to reach $12.84 billion by 2031
Within cloud billing, usage-metered models are projected to grow at a 15.34% CAGR and reach $12.84 billion by 2031. That is faster than the 14.12% CAGR forecast for cloud billing overall.
29. Cloud deployment captures 67.8% of market revenue
Cloud deployment accounted for 67.8% of total usage-based billing market revenue in 2025 across the cross-industry market, making cloud the majority deployment segment by revenue.
Enterprise readiness, security, and compliance for usage-based billing
Enterprise buyers evaluate billing platforms on controls and auditability as much as on features.
30. Large enterprises represent 63.7% of market revenue
Large enterprises accounted for approximately 63.7% of usage-based billing market revenue in 2025. That is a revenue share rather than a share of deployments. Orb maintains SOC 1 Type II and SOC 2 Type II reports. SOC 1 addresses controls relevant to financial reporting, while SOC 2 addresses security and related trust services controls.
31. Usage-based pricing adoption surpassed 58% among North American SaaS firms
According to Business Research Insights, usage-based pricing adoption surpassed 58% among North American SaaS firms in 2025. The report also identifies North America as the leading region in the subscription billing software market, accounting for approximately 39% of enterprise adoption. Both figures are publisher estimates.
32. Orb offers 99.99% SLAs
Orb makes 99.99% SLAs available for billing and revenue execution needs.
Integrating usage-based billing with existing finance ecosystems
Consumption billing has to land cleanly in the ERP, the payment stack, and the close process.
33. 47% of enterprises report ERP integration difficulties
Approximately 47% of enterprises reported integration difficulties with legacy ERP systems. Orb's NetSuite integration addresses this by creating standard NetSuite invoice records, sales orders, credit memos, and payments with configurable item mappings, while preserving a full NetSuite audit trail.
34. North America held 38.4% of market revenue
North America represented 38.4% of the cross-industry usage-based billing market in 2025, approximately $3.6 billion.
35. Asia Pacific growing fastest at a 16.1% CAGR
The Asia Pacific region is forecast to expand at a 16.1% CAGR through 2034 and accounted for 22.8% of global revenues. As with the other figures from this report, the analysis is cross-industry rather than SaaS-only.
36. Airbyte removed its engineering bottleneck and automated month-end close
Orb removed Airbyte's engineering bottleneck in billing and automated its month-end close process. A close that previously took up to two days now runs automatically, and engineering no longer gates billing changes.
Frequently asked questions
What is usage-based billing and how does it differ from subscription billing?
Usage-based billing charges customers based on actual consumption of a product or service rather than a fixed recurring fee. By contrast, a fixed subscription sets a recurring fee in advance rather than calculating the charge from metered usage, while consumption-based pricing scales with customer activity. That alignment between value delivered and revenue captured supports natural expansion as customers grow. Many companies now run hybrid models that combine a committed subscription with usage-based components, and 52% of software providers introduced hybrid billing systems combining recurring subscriptions with metered consumption.
What are the main benefits of implementing usage-based billing for SaaS companies?
Usage-based billing can lower upfront commitment and allow revenue to expand as customer consumption grows. On growth specifically, SaaS adviser Todd Gardner reported median Q2 2024 year-over-year growth of 25% for predominantly usage-based public SaaS companies versus 13% for subscription companies; those figures describe Q2 2024, and the complete comparison dataset and calculations are not published. In High Alpha's 2025 SaaS Benchmarks, consumption-based pricing grew 43% year over year, while hybrid pricing produced 105% NRR, the highest net revenue retention among the four pricing models reported in that benchmark.
How does usage-based billing impact engineering teams and operational efficiency?
Dedicated billing infrastructure can move metering, rating, and invoicing logic out of application code and reduce custom reconciliation work. Vercel decreased the time required to build and launch billing for new products by 80%, and Stytch reduced time spent processing bills and invoicing by 75%. Across the broader usage-based billing market, cloud-based deployment timelines are about 40% shorter than comparable on-premises deployments, which shortens time to market for new pricing models.
What role does data accuracy play in successful usage-based billing?
Accuracy is central because usage-based charges are calculated from metered consumption and pricing rules. Dataintelo cites industry estimates suggesting inadequate billing systems can cost organizations 3% to 7% of potential revenue through metering inaccuracies and manual reconciliation; that range is a publisher-cited estimate rather than a settled figure, and it is not SaaS-specific. In practice, the safeguard is architectural: Orb's accuracy architecture continually stores and references raw usage events and supports backfilling, backdating, and invoice recalculation.
How can companies ensure a smooth transition to usage-based pricing?
Successful transitions usually require billing infrastructure that can run legacy subscription plans and new consumption pricing at the same time, which matters because 61% of U.S. digital subscription companies expanded into hybrid models in 2025. Model the new pricing against historical consumption before launch; Orb Simulations compares pricing scenarios and financial outcomes using real product usage data. Integration with the finance stack matters from day one, and Orb's NetSuite integration creates standard transaction records with an audit trail. Phased rollouts create a controlled path for metering accuracy and the customer-facing experience before broad adoption.
What assurance reports are important for usage-based billing platforms?
Orb maintains SOC 1 Type II and SOC 2 Type II reports. SOC 1 addresses controls relevant to financial reporting, while SOC 2 addresses security and related trust services controls. Beyond these reports, useful evaluation considerations include support for ASC 606 revenue recognition, multi-currency handling, tax treatment in your operating jurisdictions, and the completeness of the audit trail from raw usage event to posted invoice. Requirements vary by company, industry, and jurisdiction, so the relevant control set depends on each organization's operating environment.