Monthly Recurring Revenue (MRR)
Monthly Recurring Revenue (MRR) is the predictable subscription revenue a business earns each month from all active recurring plans.
In depth
MRR is the monthly counterpart to ARR and is usually broken into new, expansion, contraction, and churned MRR so teams can see the components of monthly growth at a glance. Because it updates every month, it is the operating metric many SaaS teams use for short-term forecasting, sales targets, and board reporting between annual milestones. Normalizing annual plans to a monthly figure keeps comparisons consistent even when customers pay on different billing cadences.
A common pitfall is letting churned and contraction MRR hide behind strong new sales, so headline growth looks fine while net retention quietly erodes. In a quiz-funnel workflow, MRR benefits from better-qualified entry: scoring leads on budget and intent reduces the share of low-fit subscribers who downgrade or cancel within weeks, so the new MRR you add sticks and net MRR growth becomes more durable.
Example in practice
Frequently asked questions
How is MRR calculated?
Sum the monthly recurring fee of every active subscription, normalizing annual plans to a per-month figure. Exclude one-time charges so the number reflects only predictable recurring revenue.
What is the difference between MRR and ARR?
MRR measures recurring revenue per month, while ARR annualizes the same base. Many teams use MRR for monthly operations and ARR for valuation and annual planning.
Can better lead qualification improve MRR?
Yes. Screening leads for fit reduces early churn and downgrades, so more of your new MRR survives. A scorecard quiz filters low-intent prospects before they sign up.