How to calculate Annual recurring revenue (ARR)
The Annual recurring revenue (ARR) formula, with plain worked examples you can check yourself.
Annual recurring revenue (ARR) = MRR × 12
Worked examples
MRR = 9000Annual recurring revenue (ARR) = 108,000
MRR = 3000Annual recurring revenue (ARR) = 36,000
MRR = 8000Annual recurring revenue (ARR) = 96,000
How to use it
- Write down the values for each letter in the formula.
- Do the brackets first, then divide or multiply.
- Check the units before you compare results.
- Compare the answer with last period or with a competitor to see if it is good or bad.
This formula belongs to Funding & Growth.
Related terms
Practice Annual recurring revenue (ARR) with real numbers
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