Currently it shows how many notifications are in the inbox, regardless of their read status.
Bug Report Dump (Auto-generated)
Version 1.18.0 (1518753170) Device: iPhone 6s (iOS 11.2.5) TestFlight: true
I might be misunderstanding what you mean, but your inbox is your unread notifications. You can swipe to mark the item as read, or use the tick in the navigation bar to mark everything as read.
Entering an issue/PR does not (automatically) mark the content as read as the desktop version does (unless you have the "Read on Open" option enabled in the settings)
Yes, I have "read on open" set.
For example, this screenshot makes no sense. Especially when you close the app and it still shows the badge.

Indeed, seems like we would need to update the badge count if read on open is turned on.
Small bug, great starter task for anyone that wants to pick this up! Filtering happens in NotificationsViewController.
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I'll take a look myself soon
Should this issue still be open?
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@travjunt good call I think this is fine now
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I'll take a look myself soon