Definition
The predictable subscription revenue expected each month from active customers.
Formula
Sum of monthly subscription value across all active customers
How to measure
Normalize every active subscription, regardless of billing frequency, to its monthly equivalent value and sum across the customer base.
Why track it
MRR is the core scoreboard number for a subscription business and the base for MRR movement metrics like new, expansion, and churned MRR.
Example
A company with 200 customers averaging $80/month reports $16,000 in MRR.
FAQ
- What is Monthly Recurring Revenue?
- The predictable subscription revenue expected each month from active customers.
- How do you calculate Monthly Recurring Revenue?
- Sum of monthly subscription value across all active customers
- Why track Monthly Recurring Revenue?
- MRR is the core scoreboard number for a subscription business and the base for MRR movement metrics like new, expansion, and churned MRR.