When I was a national sales manager in telecommunications, a government customer ran up a huge bill on conference calls during an election. We celebrated.
The next month, their spending dropped off a cliff.
That's the trap MRR protects you from. Revenue tells you what came in. Monthly recurring revenue tells you what will come in again next month if nothing changes. This calculator shows you not just the number, but the five movements that made it.
How to use the MRR calculator
- Enter your starting MRR: the recurring revenue you had at the start of the month, excluding GST, setup fees and one-off sales.
- Add the four ways MRR goes up or down: new customers, expansion (upgrades, add-ons and price rises), reactivation (customers coming back), contraction (downgrades) and churned MRR (cancellations).
- If your numbers come straight from invoices that include GST, tick the box and the calculator takes it out.
- Bill weekly, quarterly or annually? Use the converter to turn a price into MRR first.
Your billing system's MRR report usually gives you all five movements. If it doesn't, the Stripe Export Analyzer can work them out from a subscriptions export.
How the maths works
Net new MRR = New + Expansion + Reactivation − Contraction − Churned Ending MRR = Starting MRR + Net new MRR ARR (run rate) = Ending MRR × 12 MRR growth rate = Net new MRR ÷ Starting MRR Quick ratio = (New + Expansion + Reactivation) ÷ (Contraction + Churned)
The "if every month looked like this" figure compounds your monthly growth rate over twelve months: (1 + growth)¹² − 1. It's a what-if, not a forecast. One great month doesn't make a trend.
When converting prices, weekly billing is where people slip. A year has 52 weeks, so weekly MRR is the weekly price × 52 ÷ 12, not × 4. The shortcut understates MRR by about 8 percent.
A worked example
The calculator opens with a business that starts the month on $20,000 of MRR.
It adds $2,400 from new customers, $800 from upgrades and $200 from a few returning customers. That's $3,400 gained. It loses $300 to downgrades and $1,100 to cancellations, so $1,400 lost.
- Net new MRR: $3,400 − $1,400 = $2,000
- Ending MRR: $22,000, or $264,000 ARR
- Growth: $2,000 ÷ $20,000 = 10% for the month
- Quick ratio: $3,400 ÷ $1,400 = 2.4
On the surface, a good month. But look at the quick ratio, and at the 7% gross MRR churn underneath it. For every dollar walking out, only $2.40 is coming in. Halve the churn and the business grows faster without a single extra sale.
How to read your result
The quick ratio is the one most owners haven't seen before. Below 1, you're shrinking. Above 4 is often treated as strong growth efficiency, as our subscription glossary notes. It's a better health check than growth alone, because a business can grow fast while losing customers just as fast.
Gross MRR churn (churned plus contraction, divided by starting MRR) tells you how leaky the bucket is. Compare it with the ranges on our churn benchmarks page, matched to your price point and customer type.
For growth benchmarks, SaaS Capital's 2025 survey found private B2B SaaS companies over $1M ARR grew at a median 24% a year. For a local membership business, the better benchmark is yourself: is net new MRR positive most months?
What to do next
- Read the full guide to monthly recurring revenue for what belongs in MRR and what doesn't.
- Turn your movements into net revenue retention, the number buyers and investors ask about first.
- If churned MRR is your biggest leak, run the Churn Rate Calculator and then the Churn Risk Checklist.
- Growing expansion MRR is the cheapest growth there is. Here's how to build expansion revenue.
Frequently asked questions
Should MRR include GST or sales tax?
No. MRR should be your recurring revenue excluding GST, VAT or sales tax, because the tax isn't yours: you collect it and pass it on. Including it inflates MRR by 10% in Australia and makes your margins and valuation look better than they are. If your figures come from invoices that include GST, divide by 1.1 or tick the box in the calculator.
Do free trials count towards MRR?
No. A trial user isn't paying yet, so they add nothing to MRR. Count them as new MRR in the month they convert to a paid plan. The same goes for discounts: if a customer pays $40 on a $50 plan because of a coupon, their MRR is $40 while the discount lasts, not the list price.
What is a good MRR growth rate?
It depends on your size. Small businesses can grow 10% or more a month from a low base, but that rate naturally falls as MRR grows. For a yearly reference point, SaaS Capital's 2025 survey put median annual growth for private B2B SaaS companies over $1M ARR at 24%. Track your own trend: steady positive net new MRR matters more than one big month.
What is the difference between MRR and ARR?
ARR is MRR multiplied by 12. It's the same recurring revenue expressed as a yearly run rate. Businesses selling annual contracts usually talk in ARR, while monthly subscription businesses usually talk in MRR. Neither should include one-off fees such as setup or consulting, and both should exclude GST.
How do I calculate the SaaS quick ratio?
Add new, expansion and reactivation MRR, then divide by churned plus contraction MRR. A ratio of 4 means you gain $4 of recurring revenue for every $1 you lose. Below 1, your MRR is shrinking. The ratio is most useful tracked monthly, because a rising ratio shows growth is getting more efficient even if total growth slows.
Built on The Subscription Playbook
This tool turns frameworks from Robert Coorey's book into something you can use in minutes. Robert is the author of The Subscription Playbook and a Director at BPAG Accountants. More about Robert.