Monthly recurring revenue (MRR) is the monthly equivalent of annual recurring revenue, calculated as the value of recurring contracts in force at a point in time expressed as a monthly figure. MRR is more commonly used in Australian sub-scale SaaS businesses, where annual contracts are less prevalent than month-to-month subscriptions.
The conversion of MRR to ARR is straightforward (MRR × 12), but the underlying revenue durability is meaningfully different: month-to-month MRR carries higher churn risk than ARR derived from twelve-month contracts.