Monthly Recurring Revenue (MRR) is the predictable, consistent revenue earned each month from active customer subscriptions or ongoing partner contracts. MRR provides a clear, reliable view of a company’s financial health and growth trajectory, especially in subscription-based and partner-influenced business models.
Key components of MRR often include:
- New MRR: Revenue gained from newly acquired customers or partners during a given month.
- Expansion MRR: Additional revenue from existing customers or partners through upsells, cross-sells, or plan upgrades.
- Churned MRR: Revenue lost due to cancellations, downgrades, or lost partner relationships.
- Net New MRR: The total change in MRR after accounting for new, expansion, and churned revenue, an essential metric for tracking monthly growth.
- Partner-Influenced MRR: Revenue sourced, closed, or expanded through partner efforts, providing insights into ecosystem contributions to recurring revenue streams.
MRR is a critical metric for SaaS companies, service providers, and partner programs focused on recurring business models. It informs business planning, investor reporting, partner incentives, and operational decision-making by offering a consistent measure of month-over-month performance.