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Revenue metrics

NRR (Net Revenue Retention)

Revenue this period from a cohort of existing customers, divided by what that same cohort paid a year ago, including expansion, contraction and churn.

Net Revenue Retention measures a fixed set of customers against itself, a year apart:

NRR = (starting MRR + expansion − contraction − churn) ÷ starting MRR

Crucially, no new customers enter the calculation. NRR asks what last year’s customers are worth today.

Above 100% means the existing base grew on its own, which is the property that makes a subscription business compound: revenue rises even in a month with no new sales. Best-in-class B2B SaaS sits around 120%.

NRR flatters businesses with a usage component and large customers, so it is read alongside GRR, which strips expansion out and shows how much you keep before any upside.

Related terms

  • GRR (Gross Revenue Retention) Revenue retained from an existing cohort with expansion excluded, so it can never exceed 100%. The measure of how much you keep.
  • Expansion MRR Additional recurring revenue from existing customers: upgrades, added seats, add-ons and contracted usage growth, excluding anything from new customers.
  • Cohort analysis Grouping customers by when they started and tracking each group over time, so retention and expansion can be read without new customers hiding them.