Definition
Monthly recurring revenue (MRR) is the predictable subscription revenue a business earns in a month. Yearly plans count as their annual price ÷ 12; one-off fees are excluded.
Components
| Part | What it is |
|---|---|
| New MRR | From new customers |
| Expansion MRR | Upgrades and added seats |
| Contraction MRR | Downgrades |
| Churned MRR | Cancellations |
Net new MRR = new + expansion − contraction − churned.
Using it
Track the components, not just the total: a flat MRR can hide strong acquisition offset by heavy churn. Product data explains the movements: what churned accounts stopped doing, what expanding accounts started doing.