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Metrics & Analytics

MRR (Monthly Recurring Revenue)

The predictable monthly revenue from all active subscriptions, the core metric for SaaS business health.

Definition

Monthly Recurring Revenue (MRR) is the sum of all recurring subscription revenue normalized to a monthly amount. It includes new MRR from first-time customers, expansion MRR from upgrades, and excludes one-time charges. MRR is the heartbeat metric for subscription businesses because it shows predictable, repeatable income.

Why It Matters

MRR tells you if your business is growing or shrinking in real terms. It is how investors value SaaS companies and how founders make hiring decisions. From an email marketing perspective, MRR changes are powerful triggers. A customer who just upgraded is in a different mindset than one whose MRR dropped. Segmenting by MRR lets you send the right message at the right time.

How It Works

Calculate MRR by summing the monthly value of all active subscriptions. Annual plans are divided by 12. Track MRR in components: New MRR (first purchases), Expansion MRR (upgrades), Contraction MRR (downgrades), and Churned MRR (cancellations). Net New MRR equals New plus Expansion minus Contraction minus Churned.

Best Practices

  • 1Track MRR changes as triggers for automated email sequences
  • 2Segment customers by MRR tier for personalized messaging
  • 3Send upgrade prompts to customers approaching plan limits
  • 4Celebrate expansion MRR moments with thank-you emails
  • 5Monitor contraction MRR signals to trigger retention outreach

Stripe MRR Sync

Sequenzy pulls MRR data directly from Stripe, letting you segment subscribers by revenue and trigger emails based on MRR changes like upgrades or downgrades.

Learn More

Frequently Asked Questions

ARR (Annual Recurring Revenue) is simply MRR multiplied by 12. Investors often prefer ARR for larger SaaS companies because it sounds bigger and smooths out monthly fluctuations. For operational purposes, MRR is more useful for tracking month-over-month changes.

Email directly affects MRR in multiple ways. Onboarding emails improve activation and reduce early churn. Upgrade emails drive expansion MRR. Dunning emails recover failed payments. Win-back campaigns bring back churned revenue. Every email sequence ties back to MRR.

Yes, but normalize them to monthly. A $1,200 annual plan counts as $100 MRR. Some founders track Annual Contract Value (ACV) separately, but for MRR calculations, always convert to monthly.