Advance
An advance on royalties paid at signing: kept even if sales never cover it, deducted from future royalties.
The advance is an early payment on future royalties, paid at contract signing (often split: signing, delivery of the final text, publication). Its mechanism: royalties generated by sales first repay the advance; the author receives additional royalties only once the advance has "earned out." If it never does, the advance is kept — that's the publisher's risk, not the author's debt.
The advance is thus an economic signal: its amount reflects the hoped-for print run and the house's commitment. For the author it is often the book's only certain income — hence its weight in negotiation, alongside percentages, licensed rights (paperback, foreign, audio) and their reversion clauses.
Example
A €3,000 advance; at 8% on a €20 book, it takes ~1,875 sales to earn out.