MRR & ARR

MRR is the predictable monthly revenue from active subscriptions; ARR is that same figure annualized (typically MRR × 12).

MRR and ARR are subscription-business-specific metrics — they measure recurring, contracted revenue, not one-time sales, which is why they don't apply cleanly to transactional ecommerce or one-time-purchase businesses. ARR as "MRR × 12" is a run-rate projection, not a guarantee — it assumes current MRR holds steady for a full year, which ignores both churn and expansion that will actually occur.

Investors and operators typically break MRR growth into components — new MRR, expansion MRR, and churned MRR — because "MRR grew 10% this month" hides whether that came from strong new sales, strong expansion, low churn, or some mix of all three.