Monthly recurring revenue calculation
Monthly recurring revenue definition
Monthly Recurring Revenue (MRR) is the sum of your recurring revenue at the end of the month.
How to calculate monthly recurring revenue with examples
In January, you have three customers. Customer One has been a customer for six months. They pay $12,000 upfront for an annual software subscription. In January, Customer One contributes $1,000 to MRR. Customer Two has been a customer for two months. They pay $1,000 each month on a month-to-month software subscription. In January, Customer Two contributes $1,000 to MRR. Customer Three becomes a customer on January 1. They pay $24,000 upfront for an annual software subscription and an additional $3,000 for a one-time implementation. Since only the software cost is recurring, Customer Three contributes $2,000 to MRR. Your total MRR for January is $4,000.
« Back to Glossary Index