SaaS & Business
MRR
MRRMonthly Recurring Revenue — the predictable subscription revenue a SaaS business collects every month.
Reviewed by the RadarTrek editorial team · June 2026
MRR (Monthly Recurring Revenue) is not one number but a sum of four moving parts: new MRR from new customers, expansion MRR from upgrades, contraction MRR lost to downgrades, and churned MRR lost to cancellations. Tracking the full waterfall — not just the total — reveals whether growth is healthy or whether you're refilling a leaking bucket.
Why it matters
- —The MRR waterfall (new + expansion - contraction - churned) explains *why* revenue moved, not just that it did.
- —Annual contracts should be recognised as MRR monthly, not all at once — counting it all upfront inflates month one.
- —Strong expansion MRR can push net revenue retention above 100%, meaning the business grows even with zero new customers.
Where to learn this
🎓
Revenue Metrics — MRR, ARR, and Expansion Revenue
SaaS Metrics and Finance course
This is the exact lesson that covers this term in depth — with examples, diagrams, and a hands-on exercise.