ARR calculator

Updated 2026-08-04

Enter either figure — the other is calculated.

MRR

ARR

Annual recurring revenue

$0.00

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The formula

ARR = MRR × 12
MRR = ARR ÷ 12

There is no adjustment, no seasonality factor, no discount rate. If someone quotes you a more complicated ARR formula, they're either running enterprise contracts or overcomplicating it.

Where it goes wrong

Not in the multiplication — in the MRR you start from. Every error upstream is multiplied by twelve:

Counting annual plans at full value — the big one
Including one-off revenue
Annualising a month of cash rather than normalised MRR

Get MRR right first: MRR calculator.

Which to use

MRR for operating decisions, ARR for investors and benchmarks. Full reasoning: MRR vs ARR.

Frequently asked

How do you calculate ARR?

Multiply MRR by twelve. The difficulty is not the formula but making sure the MRR you start from is correctly normalised.

Can I calculate ARR from last month's revenue?

Not reliably. Annualising a single month of cash collected produces a figure that swings with your billing calendar. Annualise normalised recurring revenue instead.