Annual Recurring Revenue (ARR): Difference between revisions
Mara Melão (talk | contribs) (Created page with "Annual Recurring Revenue (ARR) is a metric used to measure the predictable revenue that a business can expect to receive on an annual basis from its recurring revenue streams. This typically includes revenue from subscriptions or other recurring sources, such as membership fees or contract-based services. In a simplified scenario ARR can be calculated by multiplying a company's Monthly Recurring Revenue (MRR) by 12. However most SAAS companies prefer breaking down the to...") |
(No difference)
|
Revision as of 12:36, 8 December 2022
Annual Recurring Revenue (ARR) is a metric used to measure the predictable revenue that a business can expect to receive on an annual basis from its recurring revenue streams. This typically includes revenue from subscriptions or other recurring sources, such as membership fees or contract-based services. In a simplified scenario ARR can be calculated by multiplying a company's Monthly Recurring Revenue (MRR) by 12. However most SAAS companies prefer breaking down the total figure into some particular customer segments or cohorts ARRs.
Definition
ARR is calculated by multiplying a company's Monthly Recurring Revenue (MRR) by 12, plus the Total Additional Ongoing Revenue (AOR) minus the Total Customer Churn (TC)
Details
Additional Ongoing Revenue (AOR) might include:
- Training
- Cross-selling additional services
- Support
Standardization Status
Request for Comments (RFC): 22/0004 - Annual Recurring Revenue (ARR)
Type: metric
Version: 0.9
Status:proposal