Monthly recurring revenue (MRR)
Monthly recurring revenue (MRR) is the sum, over active non-trial subscriptions, of each period price normalised to a month. It is the clearest single number for the size and direction of a subscription business, and its movements (new, expansion, churned) explain why revenue changed.
Formula
MRR = Σ over active, non-trial subscriptions of period price normalised to a month ÷ interval countTake every active subscription that is not in a trial, convert its period price to a monthly amount (yearly ÷ 12, weekly × 4.33), divide by the interval count for plans billed every few months, and add them up in USD.
Worked example
| Monthly plans | 40 × $19 = $760 |
|---|---|
| Yearly plans | 10 × $490 per year |
| Yearly normalised | 10 × $490 / 12 = $408.33 |
- $760 + $408.33 = $1,168.33
MRR is $1,168.33.
How ProductLense shows it
ProductLense’s Revenue page shows MRR with new, expansion and churned MRR for the selected period, refunds, net revenue, customers, ARPU and LTV. Yearly plans are divided by 12 and weekly multiplied by 4.33, and every amount is converted to USD at the ECB daily rate.
ProductLense needs a billing connection that exposes subscriptions. Shopify has no subscriptions in ProductLense’s connector, so a Shopify store shows revenue but no MRR.
MRR: questions
- What is MRR?
- Monthly recurring revenue (MRR) is the sum, over active non-trial subscriptions, of each period price normalised to a month. It is the clearest single number for the size and direction of a subscription business, and its movements (new, expansion, churned) explain why revenue changed.
- How do you calculate MRR?
- Take every active subscription that is not in a trial, convert its period price to a monthly amount (yearly ÷ 12, weekly × 4.33), divide by the interval count for plans billed every few months, and add them up in USD. For example, 40 monthly $19 plans and 10 yearly $490 plans add up to $1,168.33 of MRR.
- Where does ProductLense show MRR?
- ProductLense’s Revenue page shows MRR with new, expansion and churned MRR for the selected period, refunds, net revenue, customers, ARPU and LTV. Yearly plans are divided by 12 and weekly multiplied by 4.33, and every amount is converted to USD at the ECB daily rate.
- What does ProductLense need to calculate MRR?
- ProductLense needs a billing connection that exposes subscriptions. Shopify has no subscriptions in ProductLense’s connector, so a Shopify store shows revenue but no MRR.
- How is MRR different from LTV?
- MRR is a snapshot of recurring revenue across all customers right now; LTV is revenue per customer over their history. MRR goes up with growth and down with churn; LTV goes up as customers stay longer.
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