CCalclabhub

Growth

Total monthly recurring revenue

Every recurring contract is converted to a monthly rate before anything is added or subtracted, so the units match.

The Formula

MRR = monthly + annual/12 + expansion - churn

Every recurring contract is converted to a monthly rate before anything is added or subtracted, so the units match.

SymbolMeaning
MRRMonthly recurring revenue
MMonthly plans
AAnnual plans
EExpansion
CChurn

What Each Symbol Means

MRRcurrency

Monthly recurring revenue

Normalised recurring revenue for the month.

Mcurrency

Monthly plans

Subscribers billed monthly times their monthly price.

Acurrency

Annual plans

Subscribers billed yearly times their annual price.

Ecurrency

Expansion

Extra recurring revenue from upgrades, net of downgrades.

Ccurrency

Churn

Recurring revenue cancelled during the month.

See It Worked With Real Numbers

A formula on its own does not tell you which number goes where. The how to calculate mrr page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.

Where This Formula Appears

This equation is the working core of How To Calculate MRR, filed under Business. Every number the guide produces comes from substituting into this one line.