Free ARR Calculator
Calculate Annual Recurring Revenue (ARR) from monthly subscriptions, annual contracts, and multi-year deals to get a complete picture of predictable yearly revenue.
Annual Recurring Revenue (ARR)
$900,000.00
Annual Recurring Revenue (ARR) vs Total Monthly Subscription Revenue
How to Calculate ARR
Formula
ARR = (Monthly Subscriptions x 12) + Annual Contracts + Multi-Year Deals (Annual Value)
ARR normalizes all recurring revenue streams to an annual figure. Monthly subscriptions get multiplied by 12, annual contracts are taken at face value, and multi-year deals are broken into their annual component. ARR excludes one-time fees like setup charges or professional services revenue.
Example Calculation
A SaaS company earns $50,000/month from monthly plans, $200,000 from annual contracts, and $100,000/year from multi-year deals.
- 01Monthly subs annualized = $50,000 x 12 = $600,000
- 02ARR = $600,000 + $200,000 + $100,000 = $900,000
- 03MRR Equivalent = $900,000 / 12 = $75,000
Frequently Asked Questions
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