Dashboard - MRR

The Monthly Recurring Revenue (MRR) is an indicator of the size and growth of your Subscription business.

MRR differs from standard revenue calculation for non-subscription business in the way that it spreads over the subscription length, the actual revenues generated by each subscription. It smoothens the noise generated by daily variations to make the general trend more readable.

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General formula

Here is the general formula to compute the MRR for a given subscription period between purchased_at and next_renewal_at ) for each day:

MRR = (amount_in_usd / number_of_days_between(purchased_at, next_renewal_at)) * 30

Where:

• amount_in_usd is the amount paid by the user during the related subscription period
• purchased_at is the date of the original purchase (for a new subscription) or last renewal date (for a subscription that already renewed)
• next_renewal_at is the theoretical next automatic renewal date, that is ignoring billing issues period.
• 30is the average number of days in a month

Examples:

• A $7weekly subscription that starts on 2024-01-01 and theoretically renews on 2024-01-08 accounts for (7.0 / 7) * 30 => $30.0 MRR between those dates.

• A $100 yearly subscription of that starts on 2024-01-01 and theoretically renews on 2025-01-01 accounts for (100.0 / 366) * 30 => $8.20 MRR between those dates. If it effectively renews on 2025-01-01 for another year (next renewal expected at2026-01-01), it will account for (100.0 / 365) * 30 => $8.22 MRR between those dates.

• A $10 monthly subscription that starts with $1 weekly introductory offer from 2024-01-01 to 2024-01-08 accounts for (1.0 / 7) * 30 => $4.29 MRR. On 2024-01-08it renews until 2024-02-08where it accounts for (10.0 / 31) * 30 => $9.68 MRR, and so on.

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Changes in MRR computation as of November 2024

• The MRR amount is now calculated based on months of 30 days and not 28 days. This allows to have a more harmonized dashboard when comparing with other tools. Also this brings us closer to the average number of days in a month (accounting for February month and leap years), that is 30.4375 days on average.
• We no longer use the plan periodicity (that you have to fill from the console) to compute MRR, and instead count the number of days between the purchased_at and next_renewal_at dates of a subscription. This allows us to spread the subscription revenues across the exact number of days it is supposed to last, accounting for varying periods (especially important on monthly subscriptions, as the stores will have different policies for subscriptions that should renew at the end of the month). Previously if plan periodicity was mismatched or not filled, related MRR would be wrongly computed or not computed at all.
• Paid offers are now properly accounted for. Previously, we would divide the amount paid during the offer over the base plan duration, which would underestimate the daily revenues during the offer.
• Refunds are also accounted for. A subscription that is refunded accounts for $0 MRR (purchase + refund cancels each others MRR during the related subscription period).