MRR Calculator

Monthly Recurring Revenue (MRR) is the total predictable revenue your SaaS business earns each month from active subscriptions. It normalizes all your recurring revenue — monthly plans, annual contracts divided by 12, usage-based fees — into a single monthly figure. MRR is the heartbeat of any subscription business because it shows whether your revenue engine is accelerating, stalling, or contracting. Investors, boards, and operators all use MRR as the primary pulse check for SaaS health.

The full MRR formula accounts for all the ways your recurring revenue changes month to month:

Each component captures a different growth or contraction lever:

• Previous MRR: Your starting baseline from the prior month
• New MRR: Revenue from brand new customers acquired this month
• Expansion MRR: Additional revenue from existing customers (upsells, upgrades, add-ons)
• Contraction MRR: Revenue lost from downgrades (customer stays but pays less)
• Churned MRR: Revenue lost from customers who cancelled entirely

Example: If your previous MRR is $50,000, you add $15,000 in new MRR, $5,000 in expansion, lose $1,000 to contraction, and $3,000 to churn, your total MRR is $50,000 + $15,000 + $5,000 - $1,000 - $3,000 = $66,000.

Count expansion and contraction at the new run rate from the renewal, not from the day the plan changed. The one-off credit and charge that settle a mid-cycle upgrade are a cash adjustment, not MRR — work those out with the SaaS Proration Calculator and keep them out of this number.

Breaking MRR into its components reveals exactly where your revenue growth is coming from — and where it is leaking:

MRR and ARR measure the same underlying metric at different time scales. ARR (Annual Recurring Revenue) is simply MRR multiplied by 12:

When to use each:

• Use MRR for month-to-month operational decisions, tracking growth momentum, and analyzing component-level changes (new, expansion, contraction, churn)
• Use ARR for fundraising conversations, board reporting, company valuation, and long-term planning. Investors and analysts think in annual terms
• Be careful annualizing MRR if your business is highly seasonal or if you had a one-time spike. ARR assumes the current month repeats for 12 months, which can be misleading

This calculator computes the MRR that is billing in the current period. It does not know about contracts you have already signed that have not started yet, expansions dated to a future renewal, or a cancellation where notice has already been served. Committed Monthly Recurring Revenue (CMRR) applies all of those on their effective dates, so it answers a different question: not what is billing now, but what will be billing once the paperwork you have already signed takes effect. Use this calculator for the current-period baseline, then build the CMRR bridge on top of it when you are planning a hire, a runway, or a financing conversation.

MRR is also not what you invoiced. An annual contract billed up front produces one large billing and twelve months of recurring revenue, and a booking recorded at signature is neither. Bookings vs billings vs revenue reconciles all four for a single contract, including the deferred revenue that a prepaid year creates. To roll several prepaid contracts into one monthly liability balance, use the SaaS deferred revenue schedule. To test how a higher price moves the current base as contracts renew, use the SaaS Price Increase Calculator.

MRR growth rate measures how quickly your recurring revenue is increasing month over month. The benchmark depends heavily on your stage:

Note that MRR growth rate naturally decelerates as your base grows. Going from $10K to $15K MRR (50% growth) is very different from $500K to $750K. What matters is maintaining a healthy rate relative to your stage.