Software-as-a-service companies track recurring revenue and retention to understand growth quality. Monthly recurring revenue (MRR) captures subscription inflows each month, while annual recurring revenue (ARR) annualizes the ending MRR base. Net revenue retention (NRR) shows whether existing customers expand, contract, or churn.
This calculator turns customer counts, ARPU, and expansion or contraction dollars into MRR, ARR, net new MRR, customer churn, and NRR for a single period. To estimate long-run customer economics, combine results with the SaaS LTV calculator. For acquisition efficiency, review the CPA calculator.
MRR and ARR formulas
Starting MRR equals starting customers multiplied by ARPU. Net new MRR adds new and expansion revenue and subtracts contraction and churned MRR:
NetNewMRR=NewMRR+Expansion−Contraction−ChurnedMRR
Ending MRR is starting MRR plus net new MRR. ARR is ending MRR times 12: ARR=EndingMRR×12. Customer churn rate for the period is churned customers divided by starting customers.
Net revenue retention (NRR)
NRR measures revenue retained from the starting cohort, including expansion and contraction, before new logo revenue:
NRR above 100% means existing customers grew revenue net of churn. Best-in-class B2B SaaS companies often report NRR above 110%. Customer-level retention is related but distinct; see the customer retention rate calculator for logo retention.
Worked example
Start with 100 customers at $250 ARPU, add 15 customers, lose 3, and record $500 expansion MRR and $200 contraction MRR.
Starting MRR: 100×250=25,000.
New MRR: 15×250=3,750. Churned MRR: 3×250=750.
Net new MRR: 3,750+500−200−750=3,300. Ending MRR: 28,300.
MRR is normalized monthly subscription revenue. ARR is MRR multiplied by 12 and is commonly used in annual planning, fundraising, and valuation conversations. Both should exclude one-time fees unless your business model treats them as recurring.
How is customer churn rate calculated?
Customer churn rate equals customers lost in the period divided by customers at the start of the period, expressed as a percentage. It measures logo attrition, not revenue churn.
What is net new MRR?
Net new MRR is the net change in recurring revenue after adding new and expansion MRR and subtracting contraction and churned MRR. It excludes starting MRR and shows how much the recurring base grew in one period.
Why is NRR important?
NRR reveals whether your installed base is expanding. High NRR lets you grow ARR even with modest new customer acquisition because upsells and seat growth offset churn.
Can ARPU differ across customer segments?
Yes. This calculator assumes one blended ARPU for simplicity. If tiers vary widely, run separate scenarios or weight ARPU by customer mix for a more accurate MRR bridge.
Resources and references
The formulas and methods in this calculator were checked against these independent sources.