1. Enter starting ARR
Use the annualised recurring contract value active at the beginning of the reporting period. This provides the baseline for growth and churn calculations.
Subscription growth calculator
Annual Recurring Revenue Calculator
Calculate ending ARR, net new ARR, monthly recurring revenue, annual growth, churn, retention, and recurring revenue per customer from one professional dashboard.
Instant ARR results
Expansion and churn
Monthly equivalent
Calculate your annual recurring revenue
Enter annualised subscription revenue movements from the same reporting period for reliable results.
Include contracted recurring subscription revenue only. Exclude
one-time implementation fees, consulting income, hardware,
taxes, and other non-recurring charges.
How the Annual Recurring Revenue Calculator works
The calculator starts with opening ARR, adds annualised recurring revenue gained, subtracts annualised recurring revenue lost, and converts the result into growth, retention, churn, and monthly-equivalent metrics.
2. Add gains and losses
Add new, expansion, and reactivation ARR. Subtract contraction and churned ARR to measure the net movement in annual recurring revenue.
3. Review revenue quality
The results show ending ARR, MRR equivalent, growth, revenue churn, net revenue retention, and average ARR per paying customer.
Ending ARR
Starting ARR + New + Expansion + Reactivation
− Contraction − Churned ARR
Net New ARR
New + Expansion + Reactivation
− Contraction − Churned ARR
ARR Growth Rate
Net New ARR ÷ Starting ARR × 100
Metric
Direction
What it tells you
Net New ARR
Positive is preferable
Positive net new ARR means annualised recurring revenue gained exceeded contraction and customer churn during the reporting period.
ARR Growth
Compare over time
Review growth across several periods and customer cohorts instead of judging performance from one unusually strong or weak reporting period.
ARR Churn
Lower is generally better
High churned ARR can signal weak onboarding, poor product fit, pricing pressure, service issues, or the loss of a few large contracts.
NRR
100%+ indicates expansion
Net revenue retention above 100% means existing and reactivated customer revenue expanded enough to offset contraction and churn before new-customer ARR.
Frequently asked questions
Important details for measuring annual recurring revenue consistently and accurately.
What is Annual Recurring Revenue?
Annual Recurring Revenue is the annualised value of predictable subscription revenue from active customers. It converts contracts with different billing frequencies into one comparable yearly recurring-revenue figure.
What revenue should be included in ARR?
Include committed recurring subscriptions, recurring licences, and recurring add-ons. Exclude setup charges, consulting services, hardware, taxes, variable non-contracted usage, and other one-time revenue.
How do I convert MRR into ARR?
Multiply monthly recurring revenue by 12. For example, $50,000 in MRR equals $600,000 in ARR, assuming the monthly recurring revenue level remains constant.
How do I annualise a monthly subscription?
Multiply the customer's recurring monthly subscription amount by 12. A customer paying $200 per month contributes $2,400 in ARR.
What is the difference between ARR and revenue?
ARR is a management metric based on annualised recurring contracts. Recognised accounting revenue records income according to accounting rules and timing. The two figures may therefore differ.
What is net new ARR?
Net new ARR is new, expansion, and reactivation ARR minus contraction and churned ARR during the same reporting period. It shows the net recurring revenue added to the business.
Can a business have positive new ARR but negative net new ARR?
Yes. New customer ARR may be positive while contraction and churned ARR are even larger. In that situation, the business added new contracts but still ended the period with less recurring revenue overall.
How often should ARR be reviewed?
Most subscription businesses review ARR monthly and quarterly, even though the metric is annualised. Segmenting ARR by product, plan, customer cohort, geography, and acquisition channel provides a more useful performance view.