Calculator
Formula used
- Adjusted MRR = Base MRR + Monthly Add‑ons − Monthly Discounts
- Gross ARR Run Rate = Adjusted MRR × 12
- Net ARR Run Rate (approx.) = Adjusted MRR × (1 + Expansion% − Churn%) × 12
- Contracts to MRR = (Amount × Qty) ÷ Period months
Non‑recurring revenue is displayed for context and excluded from ARR.
How to use this calculator
- Select a currency code for reporting.
- Choose Direct MRR or Contracts to MRR.
- Enter add-ons and discounts that repeat monthly.
- Optionally add churn and expansion percentages.
- Press calculate to see gross and net run rates.
- Download CSV or PDF for sharing and archives.
Example data table
| Scenario | Adjusted MRR | Churn | Expansion | Gross ARR | Net ARR (approx.) |
|---|---|---|---|---|---|
| Baseline | USD 25,000 | 1.00% | 2.00% | USD 300,000 | USD 303,000 |
| Higher churn | USD 25,000 | 3.00% | 2.00% | USD 300,000 | USD 297,000 |
| Growth push | USD 28,500 | 1.00% | 4.00% | USD 342,000 | USD 352,260 |
FAQs
1) What is ARR run rate?
ARR run rate annualizes your current recurring revenue pace. It estimates the yearly recurring revenue implied by today’s monthly recurring revenue.
2) Does ARR include one-time setup fees?
No. ARR measures recurring revenue only. One-time charges are excluded because they do not repeat and can distort long-term subscription performance tracking.
3) What is the difference between gross and net run rate here?
Gross run rate is simply adjusted monthly recurring revenue multiplied by twelve. Net run rate applies a quick churn and expansion adjustment as an approximation.
4) How should I choose churn and expansion percentages?
Use recent monthly trends from your customer or revenue retention reports. Keep inputs conservative when forecasting, and rerun scenarios to see sensitivity.
5) Can I calculate ARR from annual contracts?
Yes. Add contract lines and select the billing period. The calculator converts each line to a monthly equivalent and then annualizes it.
6) Should discounts reduce ARR?
Recurring discounts reduce the realized recurring revenue, so they typically reduce ARR. One-time credits should be treated as non-recurring and excluded instead.
7) Why is net ARR labeled as approximate?
It applies churn and expansion as a single monthly factor to current MRR. Real forecasts may require cohort modeling, seasonality, and product mix effects.
8) What should I export for stakeholder reporting?
Export inputs, outputs, and contract lines. That makes the assumptions auditable and helps teams compare scenarios without re-entering data manually.