Simple Monthly Recurring Revenue (MRR) Step-By-Step Financial Calculator

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Monthly Recurring Revenue (MRR)

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What is Monthly Recurring Revenue?

Often referred to simply as MRR, monthly recurring revenue is the amount of total monthly revenue generate from subscriptions.

This does not include one-time setup, onboarding or other non-recurring fees generated from a subscription. This non-recurring revenue should be reported under a separate P&L line item.

How to Calculate Monthly Recurring Revenue

  • Determine the total number of customers you have for each subscription plan.
  • If you have customers who have paid in advance on a multi-month subscription plan, then divide the total subscription value by the number of months in the plan.
  • Add all of the subscription values together to get the total monthly revenue.

  • Example

    You have 1000 total subscribers. 500 of them have subscribed to the $10 starter plan payable monthly. The other 500 customers have purchased the $300 premier plan billed annually.

    (500 x $10) + (500 x $300/12) = $17,500

    Simple MMR Formula Cheatsheet

    Annual or paid-in-advance subscription payment:

    MRR = (Prepaid subscription revenue/number of months) x number of customers)

    Monthly subscription payment:

    MRR = (Monthly subscription revenue x number of customers)

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