Monthly Recurring Revenue, commonly known as MRR, is a way of measuring predictable revenue streams from your subscriptions. It tells you, at any given point of time, how much recurring revenue your business can expect to earn in a month.
We take the revenue generated from all of your customers and convert it into a monthly format. Each time a new customer subscribes they will be added to the cumulative total. In addition to the new recurring revenue, we also consider:
- MRR Churn - If a customer churns their monthly revenue will be deducted from your MRR.
- MRR Expansion - If a customer upgrades, changes plan, or has their monthly bill increased, the difference will be added to your MRR.
- MRR Contraction - If a customer downgrades, changes plan, or has their monthly bill decreased, the difference will be subtracted from your MRR.
In addition to above, following items are also considered in calculating the MRR:
- Tax and Paddle’s fees
- Any foreign-currency subscriptions are converted into your primary currency at current exchange rates.
We do not consider following items in calculating your MRR:
- One-time payments and metered charges
- Free trials
- Discounts and coupons applied
We use the underlying subscription price to calculate the MRR, and not the discounted or reduced price of the subscription if a discount or coupon has been applied.
MRR for the day is calculated at 6am UTC everyday.