MRR Calculator
Calculate monthly recurring revenue, ARR, net new MRR, and projected next-month growth for your subscription business.
Subscription Metrics
Current number of paying subscribers or accounts.
Average monthly revenue per customer. MRR ÷ Total Customers.
% of customers who cancel each month. Best-in-class: <1%. Average SaaS: 3%–5%.
Quick Tips
- MRR = Active Customers × ARPA. ARPA = Total MRR ÷ Total Customers.
- Monthly churn >3% will likely stall growth — even high new customer acquisition can't outrun it.
- ARR = MRR × 12 (use for annual contracts or investor reporting).
Your MRR Snapshot
ARR
$294,000
MRR Growth
+7.0%
MRR Movement
Simplified Model
This calculator uses new customer MRR and logo churn only. Full MRR movement includes expansion MRR (upgrades) and contraction MRR (downgrades). Add these to your inputs for a complete picture.
What Is Monthly Recurring Revenue (MRR)?
Monthly Recurring Revenue (MRR) is the normalized, predictable revenue that a subscription business expects to receive each month from active paying customers. It is the foundational metric for SaaS companies, subscription apps, and any business with recurring billing. Unlike one-time revenue, MRR represents contracted, repeatable income — making it the primary indicator of a subscription business's health, momentum, and enterprise value.
MRR is calculated simply: MRR = Number of Active Customers × Average Revenue Per Account (ARPA). But its true power comes from tracking changes over time. By breaking MRR into its components — new MRR, expansion MRR, churned MRR, and contraction MRR — founders and investors can understand exactly where growth is coming from and where revenue is leaking.
For investor reporting, MRR is often annualized to ARR (Annual Recurring Revenue = MRR × 12). The ARR milestones of $1M, $10M, $100M, and $1B mark the key growth stages for SaaS companies, roughly corresponding to seed, Series A, Series B/C, and late-stage/IPO readiness.
How to Calculate MRR
Core Formulas
Current MRR = Active Customers × ARPA
ARR = MRR × 12
Net New MRR = New MRR − Churned MRR
Next Month MRR = Current MRR + Net New MRR
MRR Growth Rate (%) = Net New MRR ÷ Current MRR × 100
ARPA — Average Revenue Per Account (total MRR ÷ total customers)
New MRR — monthly revenue added from new customers this month
Churned MRR — monthly revenue lost to cancellations this month
Worked Examples
Example 1: Early-Stage SaaS ($49/mo plan)
500 customers × $49 ARPA = $24,500 MRR ($294K ARR). 50 new customers added, 3% churn (15 churned).
New MRR = +$2,450 | Churned MRR = −$735 | Net New MRR = +$1,715 | Next month: $26,215 MRR (+7% growth).
Example 2: Scaling SaaS (1% churn)
2,000 customers × $99 ARPA = $198,000 MRR ($2.38M ARR). 120 new customers, 1% churn (20 churned).
New MRR = +$11,880 | Churned MRR = −$1,980 | Net New MRR = +$9,900 | Growth = 5%/mo. At this rate, MRR doubles in ~14 months.
Example 3: High Churn Problem
300 customers × $29 ARPA = $8,700 MRR. 30 new customers, 8% churn (24 churned).
New MRR = +$870 | Churned MRR = −$696 | Net New MRR = +$174 | Growth = only 2%/mo. High churn is neutralizing new customer additions — the leaky bucket problem.
MRR Benchmarks by Growth Stage
| Stage | MRR Range | Target Mo. Growth | Target Churn |
|---|---|---|---|
| Pre-Revenue / Idea | $0 | — | — |
| Early Traction | $1K–$10K | 20%–30% | <5% |
| Growth (Seed/A) | $10K–$83K | 10%–20% | <3% |
| Scale (Series B+) | $83K–$833K | 5%–10% | <1.5% |
| Enterprise / IPO | $833K+ | 3%–7% | <0.5% |
When to Use This MRR Calculator
- Monthly business reviews: Track MRR growth rate, churn, and net new MRR each month to spot trends before they become problems.
- Investor updates: Report current MRR, ARR, and growth rate in your monthly investor update or pitch deck.
- Pricing experiments: Model how a price increase (higher ARPA) or churn reduction affects projected MRR over 6–12 months.
- Hiring and budget planning: Use next-month MRR projections to plan headcount and operational budget with revenue confidence.
- Goal-setting: Reverse-calculate how many new customers you need each month to hit your ARR milestones.
Tips for Growing MRR
- Fix churn before scaling acquisition. High churn makes growth nearly impossible — you're filling a leaky bucket. Get churn below 3% before doubling your marketing spend.
- Offer annual billing with a discount. Annual customers churn at 5x–10x lower rates than monthly customers. A 15%–20% annual discount is well worth the churn reduction.
- Focus on expansion MRR. Growing revenue from existing customers (upsells, seat expansion) has near-zero CAC and is the most efficient MRR growth lever at scale.
- Track cohort retention, not just overall churn. Monthly churn averages hide whether newer cohorts are churning better or worse. Cohort analysis reveals the true health of your retention.
- Aim for >100% Net Revenue Retention (NRR). NRR >100% means your existing customers grow their spend faster than others churn — you can grow MRR even without adding new customers.
Frequently Asked Questions
About This Calculator
Calculate MRR (Monthly Recurring Revenue) for SaaS and subscription businesses. Track new MRR, expansion MRR, churned MRR, and net MRR growth. Project ARR (Annual Recurring Revenue) and analyze revenue trends for investor reporting.
Frequently Asked Questions
What is Monthly Recurring Revenue (MRR)?
MRR is the total predictable revenue a subscription business expects each month. It is calculated as: MRR = Active Customers × Average Revenue Per Account (ARPA). MRR is the primary top-line metric for SaaS companies because it measures recurring, contracted revenue rather than one-time sales.
What is the difference between MRR and ARR?
MRR is your monthly recurring revenue. ARR (Annual Recurring Revenue) = MRR × 12. ARR is used for annual subscription models and enterprise SaaS investor reporting, while MRR is preferred for monthly subscription products. Both measure the same underlying business health at different time scales.
What is a good MRR growth rate?
For early-stage SaaS (under $1M ARR), 15%–20% month-over-month MRR growth is strong. At growth stage ($1M–$10M ARR), 10%–15% monthly is excellent. The key metric to watch alongside growth rate is monthly churn — high growth with high churn leads to a "leaky bucket" problem.
How does churn rate affect MRR?
Monthly churn of 5% means losing 46% of your customer base annually — extremely damaging to growth. At 2% monthly churn, you lose roughly 1 in 4 customers per year. Best-in-class SaaS companies target under 1% monthly churn. Even small churn improvements have compounding positive effects on MRR.
What is Net New MRR?
Net New MRR = New MRR (from new customers) − Churned MRR (cancellations). Positive net new MRR means your MRR is growing. A healthy SaaS company aims for net new MRR to exceed churned MRR by at least 2x–3x, indicating strong growth momentum that outpaces attrition.