Monthly recurring revenue

Measure the recurring monthly value of active customer arrangements under one documented perimeter and track customer-level movements.

Quick answer

Monthly recurring revenue, or MRR, is the monthly value of recurring charges from active customer arrangements at a measurement date. It is an operating metric; the result depends on contract annualisation, included products, usage treatment and the definition of an active paying customer.

Use the worked example

Meaning and transaction use

An SEC filing defines MRR as recurring monthly fees from active paid contracts and paying customers, assuming no subscription changes and excluding usage above the recurring base. [S1]

Another SEC filing defines MRR as the monthly value of all customer recurring charges at month end and relates ARR to MRR multiplied by 12. [S2]

Proposed control method: reconcile MRR at customer and contract level, then classify new, expansion, contraction, churn and reactivation movements.

Worked example

Illustrative month-end MRR only. Assume 300 customers pay 500 monthly, 120 customers have annual recurring charges of 18,000 and recurring discounts total 20,000 per month.

Scroll the table horizontally to view all columns.

Measure	Calculation	Result
Monthly-plan MRR	300 x 500	150,000
Annual-plan MRR	120 x 18,000 / 12	180,000
Gross MRR	150,000 + 180,000	330,000
Net MRR after recurring discounts	330,000 - 20,000	310,000

Illustrative month-end MRR is 310,000 under the stated contract and discount treatment.

Proposed transaction review process

Define MRR

Set products, customer status, recurring value, usage and exclusions.

Normalise contracts

Convert eligible recurring charges to a monthly basis.

Reconcile movements

Classify new, expansion, contraction, churn and reactivation.

Test quality

Compare MRR with billing, revenue, collections and customer counts.

Evidence checklist

Customers

Active paying status, start and end dates and customer identity.

Contracts

Recurring price, term, discounts, amendments and renewals.

Movements

Customer-level opening, change and closing MRR.

Reconciliation

MRR-to-billing and MRR-to-revenue explanations.

Decision framework

Situation	Proposed action
Annual contracts dominate	Document monthly normalisation and renewal timing.
Usage revenue is volatile	Report committed and usage components separately.
Discounts expire	Model the contracted step-up and customer risk.
MRR grows while retention falls	Separate new-logo growth from base deterioration.

Common errors to check

Including one-time revenue.
Counting non-paying or inactive customers.
Annualising variable usage without disclosure.
Combining gross and net values across periods.

Build the MRR movement bridge

Bring active contracts, billing records and customer movements to an MRR review. Reconcile the monthly recurring base and its quality.

Discuss the transaction

Primary references and editorial scope

SEC filing: MRR from active paid arrangements
Example MRR definition using active paid contracts and recurring monthly fees with stated usage treatment. Reference checked 17 September 2026.
SEC filing: MRR and ARR definitions
Example month-end MRR definition and relationship between MRR and ARR. Reference checked 17 September 2026.

Editorial qualification

General transaction education using public United States filings. Figures are hypothetical. MRR 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.