Annual Recurring Revenue (ARR)

Annual Recurring Revenue (ARR) is the annualized value of a business's recurring subscription revenue, calculated as MRR × 12. It's the standard framing for businesses on annual contracts. For example, $10,000 MRR is $120,000 ARR. ARR smooths out month-to-month noise and is the figure most often quoted in acquisition headlines, but a buyer still checks the underlying MRR trend and churn before trusting it.