Business TermMRR
Monthly Recurring Revenue
MRR
MRR is the monthly value of recurring contracted revenue in a subscription business.
- Formula
- MRR = sum of monthly recurring contract value
- Use when
- Use it for monthly SaaS growth, budgeting, and customer success priorities.
- Watch out
- Billing, cash collection, accounting revenue, and MRR can differ.
Updated: 2026. 06. 27.Sources: 1
What it means
MRR tracks recurring subscription revenue month by month. Splitting new, expansion, contraction, and churn MRR shows where growth is created or lost.
How to calculate it
| Lens | Formula / treatment | When to use it |
|---|---|---|
| Basic formula | MRR = sum of monthly recurring contract value | Measures the monthly recurring base |
What counts / what does not
| Item | Treatment | Why it matters |
|---|---|---|
| Include | Active monthly subscriptions, annual contracts converted to monthly value, recurring upsells | They are recurring revenue |
| Exclude | Setup fees, one-time services, taxes, refunds, one-off usage charges | They inflate recurring revenue |
What moves the number
| Driver | Metric impact | What to watch |
|---|---|---|
| New / Expansion MRR | Added by acquisition and expansion | Shows growth sources |
| Contraction / Churn MRR | Lost through downgrade and cancellation | Shows revenue leakage |
When it helps
- Use it for monthly SaaS growth, budgeting, and customer success priorities.
How to use it
- Bridge new, expansion, contraction, and churn every month with one definition.
Decision cautions
- Billing, cash collection, accounting revenue, and MRR can differ.
Example
Example: 100 customers at 100,000 yen per month create 10 million yen of MRR.
Compare with
| Metric | Difference | Why read together |
|---|---|---|
| ARR | Annualized recurring revenue | MRR tracks monthly movement |
Common mistakes
- Including one-time revenue misstates the recurring base.
Frequently asked questions
How is MRR different from ARR?
MRR is monthly; ARR is annualized. Use MRR for monthly movement and ARR for annual scale.
Sources
| Sources | Kind | Link |
|---|---|---|
| YogoQ Core business foundation editorial baseline | editorial | — |