Gross revenue retention

Measure the recurring revenue retained from an opening customer cohort after contraction and churn, without giving credit for expansion or new customers.

Quick answer

Gross revenue retention, or GRR, compares recurring revenue retained from a defined opening customer cohort with that cohort's opening recurring revenue. It reflects contraction and churn while excluding expansion and revenue from customers acquired after the opening date.

Use the worked example

Meaning and transaction use

An SEC-filed annual report defines gross revenue retention using prior-period ARR from the same customer set, including product or customer churn and excluding add-ons or net expansion. [S1]

Another SEC filing calculates dollar-based gross retention from prior-period ARR less ARR lost from customers that are no longer customers, divided by prior-period ARR. [S2]

Proposed control method: reconcile gross retention by customer and separate full churn from partial contraction.

Worked example

Illustrative annual GRR only. Assume opening-cohort ARR of 12.0 million, contraction of 0.8 million and churn of 1.0 million.

Scroll the table horizontally to view all columns.

Measure	Calculation	Result
Opening-cohort ARR	Given	12.0m
Retained ARR before expansion	12.0 - 0.8 - 1.0	10.2m
Gross ARR loss	0.8 + 1.0	1.8m
GRR	10.2 / 12.0	85.0%

Illustrative GRR is 85.0%; the opening cohort lost 1.8 million before any expansion credit.

Proposed transaction review process

Freeze the cohort

Identify opening customers and recurring value at the comparison date.

Capture losses

Classify partial contraction and full customer churn.

Reconcile evidence

Tie losses to contracts, billing changes and customer status.

Analyse exposure

Review segment, product, cohort, cause and concentration trends.

Evidence checklist

Opening cohort

Customer list, recurring value and measurement date.

Contraction

Downgrades, price changes, usage changes and credits.

Churn

Cancellations, non-renewals, end dates and lost recurring value.

Reconciliation

Customer-level bridge to retained recurring revenue.

Decision framework

Situation	Proposed action
GRR falls	Separate preventable service issues from structural losses.
Losses concentrate in one segment	Adjust product, pricing or coverage using verified drivers.
NRR is strong while GRR is weak	Assess dependence on expansion from fewer customers.
Metric rules changed	Restate periods or disclose the comparability limit.

Common errors to check

Crediting expansion in GRR.
Including new-customer revenue.
Ignoring partial contraction.
Changing the cohort or revenue perimeter across periods.

Reconcile gross retention

Bring customer-level ARR, contraction and churn records to a GRR review. Quantify the recurring base retained before expansion.

Discuss the transaction

Primary references and editorial scope

SEC filing: Gross revenue retention definition
Example GRR definition using same-customer ARR, including churn and excluding add-ons or expansion. Reference checked 17 September 2026.
SEC filing: Dollar-based gross retention calculation
Example calculation using prior-period ARR less customer churn divided by prior-period ARR. Reference checked 17 September 2026.

Editorial qualification

General transaction education using public United States filings. Figures are hypothetical. GRR is a non-standard operating metric whose definition can differ by company.

General business information. Obtain advice appropriate to the legal, tax, accounting and financing facts. No offer, lender commitment or transaction outcome is represented. All worked examples use expressly assumed figures. Editorial draft date: 17 September 2026.