Monthly Recurring Revenue (MRR)
Monthly recurring revenue or MRR represents predictable subscription or usage fee revenue recognized from customers each month. MRR demonstrates stable income consistency for SaaS businesses versus fluctuating one-time purchases.
MRR is a pivotal metric used for monitoring and forecasting performance. Sales leaders examine MRR trends to assess subscriber acquisition rates, product adoption, renewals, upsells, and referrals. Higher MRR indicates successful sales execution converting and retaining accounts on recurring contracts.
Predictable MRR enables smoother budgeting and capacity planning. However, MRR projections require adjustments accounting for possible customer churn each month. Overall growth depends on sales success maximizing new MRR from sales while minimizing MRR losses from cancellations.