Also called: Monthly Recurring Revenue
TL;DR
Monthly Recurring Revenue, the normalized monthly value of all subscriptions in force, often used by month-to-month subscription businesses.
MRR is the monthly equivalent of ARR. Annual contracts are divided by 12 to compute their monthly contribution. MRR is favored by month-to-month SaaS businesses (consumer SaaS, freelancer tools, prosumer products) where the monthly cadence aligns with how customers actually buy and pay.
MRR decomposition into 'new MRR', 'expansion MRR', 'contraction MRR', and 'churn MRR' is the standard SaaS health diagnostic. Net new MRR each month is the leading indicator most operators track.
MRR = Σ (Monthly Subscription Value of all active customers)
Net new MRR = New + Expansion − Contraction − Churn. Track all four components, not just the headline.
Starting MRR $400k; +$32k new + $14k expansion − $6k contraction − $11k churn = ending MRR $429k. Net new MRR = $29k; gross new MRR = $46k.
MRR appears on the Traction slide for early-stage SaaS; later-stage companies usually report ARR.
MRR shows up most often in these scoring rubrics and investor profiles, jump straight to who cares about it and how to pitch them.
Annual Recurring Revenue, the value of subscription contracts on a normalized 12-month basis, the headline SaaS revenue metric.
The percentage of recurring revenue retained from a cohort after one year, including expansion, contraction, and churn.
The percentage of customers (logos) who cancel in a given period, regardless of how much revenue they represented.
The percentage of recurring revenue lost from existing customers in a period through cancellation or downgrade.
A motion where a small initial deployment grows into a much larger account through additional seats, products, or use cases.
Long-form deep dives on the slides MRR most often shows up on.
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