Monthly recurring revenue (MRR)

Monthly recurring revenue is the predictable revenue a subscription business expects to earn each month from active subscriptions. Annual and quarterly plans are normalised to a monthly amount, and one-off fees such as setup or services are excluded. It is the base figure behind most SaaS growth and retention metrics.

Formula

MRR = sum of each active subscription’s billed price per period, normalised to one month

How to read it

Take MRR from the price actually billed for each period, not from a rescaled annual figure, so rounding stays consistent. Discounts that are active now should be netted out. MRR moves for five reasons: new business, expansion, contraction, churn and reactivation, and a good report shows each separately rather than one net number.

In Revvly

• Docs: reference metrics

Further reading

• The MRR you report isn't the MRR you earned.
• The recurring revenue model: why it changes how a business has to be run
• ARR vs MRR: why finance teams need both, and how they connect

Related terms

• Annual recurring revenue (ARR)
• Expansion MRR
• Contraction MRR
• Net revenue retention (NRR)