MRR Calculator
Monthly recurring revenue is the number a subscription business is actually valued on. It is not total revenue: it strips out one-off sales and spreads annual contracts evenly across twelve months.
Monthly recurring revenue
$14,283.33
- Annual run rate
- $171,400.00
- Net new MRR
- $400.00
- Revenue per account
- $49.25
Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.
The formula this calculator uses
MRR = monthly plans + annual plans / 12 + expansion - churn
- monthly plans
- Subscribers billed every month, times the monthly price
- annual plans
- Subscribers billed yearly, times the annual price divided by twelve
- expansion
- Extra recurring revenue from upgrades and seat additions
- churn
- Recurring revenue lost to cancellations and downgrades
How to check the result by hand
- 1
Separate recurring from one-off revenue
Setup fees, services and hardware are excluded. Only contracts that repeat on a schedule belong in the calculation, and mixing the rest in destroys the number's predictive value.
- 2
Normalise annual plans to a month
Divide the annual contract value by twelve. A four hundred and ninety pound annual plan contributes about forty one pounds a month, not four hundred and ninety in the month it is signed.
- 3
Add the monthly plans
Subscribers billed every month contribute their price directly. Two hundred and fifty at forty nine pounds is twelve thousand two hundred and fifty.
- 4
Add expansion and subtract churn
Upgrades add to the total and cancellations subtract from it. In the default example twelve hundred of expansion and eight hundred of churn leave a net four hundred.
- 5
Multiply by twelve for ARR
The same figure on an annual basis. Fourteen thousand two hundred and eighty three a month is one hundred and seventy one thousand four hundred a year.
For worked examples, common mistakes and the limits of this formula, read the full How To Calculate MRR page.