SaaS metrics

MRR & ARR Calculator

Calculate monthly recurring revenue from your monthly and annual plans, see the net new MRR waterfall that drives it, and get your ARR and ARPU in the same pass. Computed live in your browser — nothing is stored.

Monthly recurring revenue

$9,663

That is $115,960 of annual recurring revenue, or $9,663 per month annualised.

Subscription MRR: $7,513
Net new MRR: $2,150
ARPU: $60.40
MoM growth: 28.62%
ARR: $115,960
Customers: 160

Net new MRR waterfall

New MRR	$2,400
Expansion MRR	$600
Churned MRR	-$850
Net New MRR	$2,150
Closing MRR	$9,663

MRR growth rate benchmarks

Month-over-month MRR growth is the headline number in any investor update. It decays predictably with scale: a $10k MRR business growing 20% a month is unremarkable, while a $1M MRR business growing 8% a month is exceptional.

MRR band	Typical MoM growth	Best-in-class
Pre-$10k MRR Small bases move fast. Growth here says more about distribution than product.	10% - 25%	30%+
$10k - $50k MRR The stage where repeatable acquisition channels should be emerging.	8% - 15%	20%+
$50k - $250k MRR Churn starts to be a visible drag on the net figure.	5% - 10%	15%+
$250k - $1M MRR Sustaining 10%+ here is what separates top-decile companies.	4% - 8%	12%+
$1M+ MRR Compounding 5% a month still triples MRR in about 22 months.	3% - 6%	8%+

Growth-rate bands are the widely reproduced SaaS benchmark tables used in investor updates. Your own trailing three-month average is the honest number; a single strong month is noise.

Frequently asked questions

What counts as MRR?

Committed recurring revenue normalised to one month. Monthly subscriptions count at face value; annual subscriptions count at one twelfth of the yearly price; quarterly plans at one third. One-off charges — setup fees, professional services, hardware, overage that does not recur — are excluded and belong in a separate non-recurring revenue figure.

How do I treat annual subscriptions in MRR?

Divide the annual price by twelve and recognise that amount each month. Booking a $1,200 annual payment as $1,200 of MRR in the month it lands inflates the month by a factor of twelve and creates an artificial spike followed by a cliff. It is the single most common MRR reporting error.

What is the difference between MRR and ARR?

ARR is simply MRR multiplied by twelve. It is a present-tense annualisation of the current run-rate, not a forecast or a trailing twelve-month total. A business at $10k MRR has $120k ARR even if it only started charging customers two months ago.

What is net new MRR and why does it matter?

Net new MRR is new MRR plus expansion MRR minus churned and contraction MRR — the amount your recurring revenue changes by this month. It is more informative than the headline total because it shows the underlying movement: a flat MRR total can hide heavy churn offset by heavy acquisition, which is a much worse position than it appears.

Should I count trials as MRR?

No. A trial generates no revenue until it converts. Count it only from the first billing period. Tracking "trial MRR" as if it were real is a common way to overstate traction and it produces a nasty surprise when the conversion rate turns out to be low.

How is MRR different from bookings or cash collected?

Bookings are the total contract value signed in a period (often including multi-year deals), and cash collected is what hit the bank. MRR is the recurring revenue you are entitled to per month. All three are useful, but only MRR reflects the subscription business itself, and mixing them produces growth rates that cannot be compared with anyone else.

How MRR and ARR are calculated

The formula

subscription MRR = monthly customers * monthly price
                 + annual customers * (annual price / 12)
MRR              = subscription MRR + new MRR + expansion MRR - churned MRR
ARR              = MRR * 12
ARPU             = MRR / paying customers

The division by twelve on annual plans is the whole trick. A customer paying $490 per year contributes $40.83 of MRR, not $490. Get this wrong in either direction and every downstream metric — ARR, ARPU, LTV, growth rate — is wrong with it.

The net new MRR waterfall

Finance teams split the monthly change into four components, and the split is what makes the number actionable:

New MRR — from customers who were not paying last month. This is what marketing and sales produce.
Expansion MRR — upgrades and seat additions from existing customers. The cheapest revenue in the business.
Contraction MRR — downgrades from customers who stayed. A leading indicator of churn.
Churned MRR — customers who left entirely.

Two companies both growing by $1,000 of MRR a month are in very different health if one has $200 of churn and the other $4,000. The waterfall is what exposes that. The quick ratio calculator turns exactly these four numbers into a single efficiency score.

Common mistakes

Booking annual contracts as one month of MRR. The most frequent error, and the most damaging, because it makes a small business look twelve times larger in the month the contract lands.
Including non-recurring revenue. Setup fees, one-off consulting and hardware are real revenue but not recurring revenue. Keeping them in MRR makes growth look volatile for no reason.
Counting discounts inconsistently. MRR should be net of discounts — what the customer actually pays on an ongoing basis, not list price.
Ignoring currency. If you bill in several currencies, convert at a stated rate and use the same rate every month, otherwise MRR moves with the exchange rate rather than with the business.
Reporting a single month. MRR is a point-in-time figure; the trend over three months is the signal.

Growth rate, and how to read it

Month-over-month growth is naturally higher at small scale, because a fixed number of new customers is a larger percentage of a smaller base. A company at $5k MRR growing 20% a month is doing something quite different from one at $500k MRR growing 20% a month — the latter is exceptional. Compare yourself against the band that matches your current MRR, not against a single headline number.

Growth also compounds: a steady 5% monthly growth rate roughly triples MRR in 22 months, while 10% roughly quadruples it in 15. Small, sustained differences in the rate dominate any one-off spike.

Related calculators

Feed the ARPU from this page into the LTV:CAC calculator, or use the runway calculator to see how long your current cash lasts at this revenue level and burn rate.

How the MRR formula is derived

Step 1 — normalise every plan to one month

Recurring revenue is only additive if every contract is expressed over the same period, and the natural period is one month. A monthly plan is already there; anything else is divided by the number of months it covers:

monthly plan  → price
quarterly plan → price / 3
annual plan    → price / 12

A $1,200 annual plan is $100 of MRR, not $1,200. This is not an accounting nicety — it is what makes the number comparable between a company that sells annually and one that sells monthly, and it is why booking the full $1,200 produces a twelvefold spike and then a cliff the following month.

Step 2 — sum the contracts

With every line on a monthly basis, MRR is the total of the active subscriptions:

subscription MRR = Σ (plan price normalised to one month)

Step 3 — reconcile against the movement

A total is a photograph; the movement is the film. The month-on-month change decomposes exactly into four parts, and because they are disjoint the identity holds with no residual:

net new MRR = new + expansion - contraction - churned
closing MRR = opening MRR + net new MRR

If your waterfall does not reconcile to the closing total, the four components are double-counting somewhere — a customer who upgraded and then cancelled in the same month is the usual culprit. This check is worth running every month, because a waterfall that does not add up is how churn gets quietly hidden.

Step 4 — annualise and average

ARR  = MRR × 12
ARPU = MRR / paying customers

ARR is a present-tense annualisation of the current run-rate, not a trailing-twelve-month total and not a forecast. ARPU is the MRR per paying customer — trials and free users are excluded from the denominator, and including them is a common way to understate ARPU and therefore everything downstream of it.

Assumptions and where this breaks

Every model is wrong somewhere. These are the assumptions baked in here, and the situations in which you should not trust the number that comes out.

Assumes

Every subscription is presumed to continue at its current price for the period being reported — MRR is a run-rate, not a forecast, and it contains no assumption about future churn.
Annual and quarterly plans are normalised by dividing by 12 and by 3 respectively, so the figure is a monthly entitlement regardless of when cash actually arrives.
The revenue is recurring by contract. One-off charges are excluded and belong in a separate non-recurring line.
Amounts are net of discounts and stated in one currency at a fixed conversion rate.
Expansion, contraction, churn and new MRR are mutually exclusive and non-overlapping, so the waterfall sums without double-counting a customer who upgraded and then churned in the same month.

Does not apply when

You bill in several currencies. Converting at a live rate makes MRR move with the exchange rate rather than with the business, and month-over-month growth becomes uninterpretable.
Revenue is usage-based or transactional rather than contractual. Consumption revenue is real and valuable, but it is not “monthly recurring” and it should be reported separately; a variable usage line inside MRR makes the growth rate meaningless.
A large share of revenue is non-recurring services. Including it inflates MRR and lowers the apparent growth quality.
You are comparing your MRR growth to a published band without matching the segment. A 20% monthly rate at $5k MRR and at $500k MRR are entirely different achievements, and the benchmark table is segmented for that reason.
You need a cash figure. MRR is revenue recognition, not cash collection — an annual plan paid up front shows the same MRR as twelve monthly payments but a very different bank balance.

Edge cases handled explicitly

Zero customers produces a zero ARPU rather than a divide-by-zero; the formatter never renders NaN as a blank cell.
Trials are excluded until the first billing period, so a converting trial appears as new MRR in the month it starts paying, not the month it was taken out.
A negative net-new month is reported as a contraction in the base rather than being clamped at zero — a shrinking business should see it.

Where the benchmark numbers come from

The bands in the table above are drawn from the following published sources. They are orientation figures published for the whole industry, not a proprietary dataset and not a target — your own segment, stage and three-month trend matter more than any published band.

Commonly cited SaaS reporting conventions: The monthly-normalisation rule (annual ÷ 12) and the new/expansion/contraction/churned waterfall are near-universal in SaaS finance writing; there is no single standards body, so they are presented as convention.
ChartMogul: Publishes worked definitions of MRR, ARR and the movement waterfall that match what this calculator implements.
Bessemer Venture Partners: Their cloud-metrics glossary is a common reference for keeping non-recurring revenue out of MRR.

Where no single institution publishes a figure, this page says so and labels it commonly cited rather than attributing it to a named firm. Nothing on this site is presented as proprietary data we collected.

These six tools are designed to be read as one chain, not six separate numbers:

LTV:CAC → CAC Payback → Quick Ratio → MRR → Churn → Runway

Each tool in the chain is a pure function of the ones before it, which is why the six share one formula module and one set of benchmark bands — the same inputs on different pages cannot disagree here.

Maintained by The SaaS Metrics Calculators Editorial Team

Maintained by the site’s editors, with every formula unit-tested and every benchmark traced to a published source

Formulas and benchmarks last reviewed October 2026.

This page is educational. Every figure is computed in your browser from the inputs you supply, and nothing is checked against your own accounts — treat results as a planning aid, not as financial advice.