Business & Sales

What Is Monthly Recurring Revenue (MRR)?

Monthly recurring revenue (MRR) is the predictable revenue a subscription business expects to receive every month from active subscriptions. It excludes one-time fees and is used to track growth, churn, and expansion. Annual recurring revenue (ARR) is MRR multiplied by 12.

Formula

MRR = number of paying subscribers × average monthly revenue per subscriber. 500 subscribers paying 20 a month give MRR of 10,000 and ARR of 120,000.

Annual Plans

Annual subscriptions are usually divided by 12 when calculating MRR.

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🔗 Related Terms

Churn Rate Recurring Subscription Customer Lifetime Value (CLV) Revenue

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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.