# What is MRR?

> MRR, monthly recurring revenue, is subscription revenue normalized to one month. How to calculate it, what to leave out, and how to show it verified.

**MRR (monthly recurring revenue)**: MRR is the predictable revenue a business earns from subscriptions in one month, with every plan converted to a monthly amount.

MRR, or monthly recurring revenue, is the subscription revenue a business can expect each month, with every plan converted to a monthly amount.

## The short definition

**MRR** is the sum of what all your active subscriptions are worth per month. A $10 monthly plan adds $10. A $120 yearly plan adds $10 too, because $120 divided by twelve is $10. One-off payments, setup fees and refunds of past months are not part of it.

It is the headline number for subscription businesses because it changes slowly and predictably, which makes growth easy to see.

## How to calculate it

1. List every **active** subscription. Canceled or fully unpaid ones do not count.
2. Convert each to a monthly amount: divide yearly by 12, multiply weekly by about 4.35, and so on.
3. Apply **discounts** that are currently active: a 50% coupon halves that subscription's contribution.
4. Multiply by quantity for per-seat plans.
5. Add it all up.

Most disagreements about MRR come from step 1 (do trials count?) and step 3 (do discounts count?). Pick a rule and state it.

## MRR vs revenue

MRR is a snapshot of recurring income. **Revenue** is what actually came in during a period, including one-off sales. A business can have high revenue and no MRR (a store), or MRR that differs from this month's cash because of yearly plans paid up front.

For products without subscriptions, a rolling **last 30 days of sales, net of refunds** is a fair comparable. Read [MRR vs last 30 days: which to show](https://makerhandle.com/blog/mrr-vs-revenue-which-to-show) and see [ARR](https://makerhandle.com/glossary/arr).

## How makerhandle shows MRR

Connect Stripe with a read-only restricted key and makerhandle calculates MRR exactly as above: active subscriptions, normalized to monthly, with active discounts applied. The number shows with a check mark and refreshes every few hours. Projects without subscriptions show the last 30 days of charges, net of refunds.

See [Stripe MRR](https://makerhandle.com/features/stripe-mrr) and [how to show verified MRR](https://makerhandle.com/blog/how-to-show-verified-mrr).

## Questions

### What does MRR stand for?

Monthly recurring revenue: subscription revenue converted to a monthly amount.

### Do yearly plans count toward MRR?

Yes, divided by twelve. A $120 yearly plan adds $10 of MRR.

### Do free trials count?

Usually not, because nothing is being paid yet. State your rule if you include them.

### Is MRR the same as revenue?

No. MRR is recurring subscription value per month. Revenue is all money received in a period, including one-off sales.

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Source: https://makerhandle.com/glossary/mrr
makerhandle: makerhandle is a link in bio for makers and founders: every project with its status and revenue verified from Stripe, Paddle and more.