MRR (Monthly Recurring Revenue)
Quick answer
What is mrr (monthly recurring revenue)?
The predictable revenue a subscription business collects every month from active subscribers.
Also called: Monthly recurring revenue, MRR rate, Subscription MRR.
How to calculate mrr (monthly recurring revenue)
MRR = number of active paying subscribers × average monthly price per subscriber
Worked example: 120 members paying $49 a month = 120 × $49 = $5,880 MRR.
Annual plans are counted by dividing the yearly price by 12, so a $588 annual plan adds $49 to MRR, not $588.
In plain English
MRR totals what every active subscriber pays in a month, giving a business a predictable baseline instead of relying on one-time sales. It's the core health metric for any subscription or membership offer.
Example
200 subscribers paying $49/month = $9,800 in MRR.
Why it matters
It's the reason churn matters so much to subscription businesses — losing MRR to cancellations can silently outpace new signups.
Common questions
- What does MRR stand for?
- MRR stands for monthly recurring revenue: the predictable amount a subscription business bills every month, before one-off sales are counted.
- How do you calculate MRR?
- Multiply the number of active paying subscribers by the average monthly price they pay, converting any annual plans to their monthly equivalent by dividing by 12.
- What is the difference between MRR and ARR?
- ARR (annual recurring revenue) is simply MRR multiplied by 12. MRR is the month-by-month view; ARR is the same number expressed as a year.
- What does MRR mean in simple terms?
- It is the money you can count on arriving every month from people who are already subscribed, ignoring one-off sales, refunds pending and anything you hope to sell later.
- Is MRR the same as revenue?
- No. Revenue is everything you collected in a period, including one-time purchases. MRR only counts the recurring portion, which is why it is the number used to judge whether a subscription business is actually growing.
- What counts as good MRR growth?
- There is no universal benchmark, and any number quoted as one is usually marketing. Judge it against your own previous months and against churn: MRR that grows while churn also grows is fragile growth.
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