Monthly Recurring Revenue (MRR)

Monthly Recurring Revenue (MRR) is a metric used to track the amount of predictable revenue that a company can expect to receive on a regular basis. This typically includes revenue from subscriptions or other recurring sources, such as membership fees or contract-based services. MRR is an important metric for businesses that rely on recurring revenue streams, as it provides a way to track the growth and stability of their revenue over time. It is typically measured on a monthly basis and can be used to forecast future revenue and help with planning and decision making.

Definition

To calculate MRR you have the Average Revenue per User (ARPU) multiplied by the total number of customers (TNC). Note that all figures used in the formula above must be determined on a monthly basis.

$MRR=ARPU\times \ TNC$

Details

Average Revenue Per User (ARPU) is a metric used to measure the revenue generated by an average user within a specified time period.

• To calculate ARPU, you would divide the total revenue generated by a business by the number of users or customers it has.

Standardization Status

Request for Comments (RFC): 22/0003 - Monthly Recurring Revenue (MRR)
Type: metric
Version: 0.9
Status:proposal

See also

• Average Revenue Per User (ARPU)
• Annual Recurring Revenue (ARR)

Sources

• What is Monthly Recurring Revenue (MRR)? (corporatefinanceinstitute.com)