Enter the average monthly recurring revenue ($) and the number of customers into the calculator to determine the Annual Recurring Revenue. 

Annual Recurring Revenue Formula

The following formula is used to calculate the Annual Recurring Revenue. 

ARR = MRR * #C *12

  • Where ARR is the Annual Recurring Revenue ($/year)
  • MRR is the average monthly recurring revenue ($) 
  • EC is the number of customers 

How to Calculate Annual Recurring Revenue?

The following example problems outline how to calculate Annual Recurring Revenue.

Example Problem #1:

  1. First, determine the average monthly recurring revenue ($). In this example, the average monthly recurring revenue ($) is given as 174.
  2. Next, determine the number of customers. For this problem, the number of customers is given as 90.
  3. Finally, calculate the Annual Recurring Revenue using the equation above: 

ARR = MRR * #C *12

The values given above are inserted into the equation below:

ARR = 174 * 90 *12 = 187,920 ($/year)

Example Problem #2: 

The variables needed for this problem are provided below:

average monthly recurring revenue ($) = 180

number of customers = 30

Entering these values and solving gives:

ARR = 180* 30 *12 = 64,800 ($/year)