Monthly Recurring Revenue (MRR) represents the predictable, subscription‑based income your SaaS business can count on every month.
By standardizing every plan—whether it bills daily, weekly, annually, or anything in between—MRR paints a single, comparable picture of customer‑driven revenue. Tracking it precisely lets you:
Forecast growth with confidence
Spot churn or contraction before it snowballs
Quantify the impact of product, pricing, or marketing experiments
1 | How Grow Slash Calculates MRR
1.1 MRR movement categories and their meaning
Every subscription change is sorted into one of five MRR movement categories:
MRR movement category | What it represents | Typical trigger |
New Business | First‑time recurring revenue from a customer | Initial paid sign‑up |
Expansion | Increase in revenue from an existing customer | Plan upgrade, extra seats, add‑ons |
Contraction | Decrease in revenue from an existing customer (still active) | Plan downgrade, seat reduction |
Churn | Complete loss of recurring revenue | Cancellation, payment failure beyond grace period |
Reactivation | Recurring revenue regained after prior churn | Former customer re‑subscribes |
Net MRR Change
Net MRR Change = (New Business MRR + Expansion MRR + Reactivation MRR) - (Churn MRR + Contraction MRR)
1.2 Fixed, metered, and pay‑as‑you‑go billing
Grow Slash records revenue at the correct moment for each billing model:
Line‑item type | Usage type | How we recognise revenue |
| Fixed Recurring | Added to MRR when the invoice is created (amount known upfront). |
| Metered Recurring | Added to MRR only at period end, after usage is finalised. Until then its contribution is 0. |
| Pay‑as‑you‑go | One‑off items, excluded from MRR but counted in Total Revenue. |
1.3 Converting any interval to “monthly”
To compare all plans on a common scale, Grow Slash converts each billing interval into its monthly equivalent:
Billing interval | Conversion factor | Example |
Day | 30.42 days ≈ 1 month | $10 per day → $304.20 MRR |
Week | 4.34524 weeks ≈ 1 month | $50 per week → $217.26 MRR |
Month | Direct 1 : 1 | $99 per month → $99 MRR |
Year | 12 months | $1 200 per year → $100 MRR |
1.4 Discounts and refunds
Discounts – MRR uses the post‑discount amount collected (
amount_paidon the invoice).Refunds – Refunds are not netted out of MRR; they appear separately in revenue recognition reports.
2 | Key Considerations
Metered revenue recognition – Revenue from metered subscriptions is added to MRR only at period end, once usage is final and the invoice posts.
Refund treatment – Refunds do not alter historical MRR. They are tracked separately so recurring metrics stay consistent.
One‑time fees – Setup charges, professional‑services fees, and other non‑recurring items are excluded from MRR because they do not repeat. They are reported in Total Revenue and Cash Flow views.
Further guidance – For scenario‑specific calculations or accounting questions, email metrics@growslash.com and our metrics specialists will be happy to assist.