MRR (Monthly Recurring Revenue)

Monthly Recurring Revenue (MRR) is the predictable revenue a subscription business expects to receive every month. It normalizes subscription revenue to a monthly basis regardless of billing frequency.

Key Details

  • Calculated by summing all active subscription values normalized to monthly amounts
  • Core SaaS metric used for forecasting, valuation, and operational planning
  • Tracks components like new MRR, expansion MRR, contraction MRR, and churned MRR
  • Requires proper reconciliation between billing systems and recognized revenue

Related Terms

ARR (Annual Recurring Revenue)Revenue RecognitionDeferred Revenue

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