Glossary · Metrics

What is MRR?

Monthly recurring revenue

MRR (monthly recurring revenue) is the subscription income a service can expect every month from its active subscribers, with all plans normalized to a monthly amount. It excludes one-time sales and other irregular income.

How to calculate MRR

Multiply the number of active subscribers on each plan by that plan's monthly price and add the results. 4,000 subscribers at $5 and 1,000 at $9 is $29,000 of MRR.

Convert longer plans to a monthly figure: a $60 annual plan counts as $5 a month, not $60 in the month it is paid.

What MRR leaves out

  • Rentals, purchases and pay-per-view tickets
  • Advertising revenue
  • Coin packs and other one-time in-app purchases
  • Subscribers in a free trial, until they are charged

The movements inside MRR

The change in MRR from one month to the next is made of four parts: new MRR from new subscribers, expansion MRR from upgrades, contraction MRR from downgrades and churned MRR from cancellations.

Net new MRR is new plus expansion, minus contraction and churned. Watching the parts separately shows whether growth comes from acquisition or retention, which a single total hides.

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FAQ

MRR, answered.

More definitions in the streaming glossary.

Planning a streaming service?
What does MRR stand for?

MRR stands for monthly recurring revenue.

What is the difference between MRR and ARR?

ARR is annual recurring revenue, which is MRR multiplied by 12. Services with mostly monthly plans tend to report MRR; those with mostly annual contracts report ARR.

Is MRR the same as monthly revenue?

No. Monthly revenue includes everything received in the month, such as rentals, ads and annual payments in full. MRR counts only the recurring subscription amount, normalized per month.

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