Licensing Revenue

Definition of 'Licensing Revenue'


Income earned by a company for allowing its copyrighted or patented material to be used by another company. Some examples of things that may be licensed include songs, sports team logos and technology. For example, a major source of income for the publicly traded company Dolby Laboratories is the licensing of its technology to consumer electronics manufacturers such as DVD player manufacturers.

Investopedia explains 'Licensing Revenue'


Licensing revenues are a significant source of revenue for the National Basketball Association, National Football League, National Hockey League and Major League Baseball. These organizations grant permission to third parties, such as apparel vendors, to use teams' logos in video games, on clothing and on other merchandise. The vendor keeps part of the profit for its role in producing and selling the apparel, but the sports association also earns money in exchange for granting the vendors the right to use the teams' logos. In 2010, the MLB sold licensed merchandise worth approximately $2.75 billion.



comments powered by Disqus
Hot Definitions
  1. Benchmark Bond

    A bond that provides a standard against which the performance of other bonds can be measured. Government bonds are almost always used as benchmark bonds. Also referred to as "benchmark issue" or "bellwether issue".
  2. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying a company's shares outstanding by the current market price of one share. The investment community uses this figure to determine a company's size, as opposed to sales or total asset figures.
  3. Oil Reserves

    An estimate of the amount of crude oil located in a particular economic region. Oil reserves must have the potential of being extracted under current technological constraints. For example, if oil pools are located at unattainable depths, they would not be considered part of the nation's reserves.
  4. Joint Venture - JV

    A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This task can be a new project or any other business activity. In a joint venture (JV), each of the participants is responsible for profits, losses and costs associated with it.
  5. Aggregate Risk

    The exposure of a bank, financial institution, or any type of major investor to foreign exchange contracts - both spot and forward - from a single counterparty or client. Aggregate risk in forex may also be defined as the total exposure of an entity to changes or fluctuations in currency rates.
  6. Organic Growth

    The growth rate that a company can achieve by increasing output and enhancing sales. This excludes any profits or growth acquired from takeovers, acquisitions or mergers. Takeovers, acquisitions and mergers do not bring about profits generated within the company, and are therefore not considered organic.
Trading Center