MRR / ARR
Monthly / Annual Recurring Revenue
In one sentenceThe predictable subscription revenue a business brings in each month (MRR) or year (ARR).
What it means
Recurring revenue is the heartbeat of subscription businesses. ARR is roughly MRR × 12. Investors and owners watch new MRR, expansion MRR (upgrades) and churned MRR.
How to use it
- Track net new MRR each month: new + expansion − churned.
FormulaARR ≈ MRR × 12
Net new MRR = new MRR + expansion MRR − churned MRR
Net new MRR = new MRR + expansion MRR − churned MRR
Related terms
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