SaaS Annual Recurring Revenue (ARR) Calculator
Calculate your Annual Recurring Revenue (ARR) below by providing your average ARR per customer and your total number of customers.
ARR Calculator FAQ
What is Annual Recurring Revenue (ARR)?
ARR is the total annual revenue expected from recurring subscriptions in your SaaS business. It gives you a snapshot of your companies expected revenue over the next year.
How do you calculate ARR?
ARR is calculated by multiplying the monthly recurring revenue (MRR) by 12. This accounts for the total revenue expected from subscription-based customers over a year.
Why is ARR important for SaaS businesses?
ARR is a crucial metric for assessing your SaaS business's long-term financial health and growth potential. It helps you forecast revenue, evaluate performance, and attract investors.
How can SaaS businesses increase their ARR?
SaaS businesses can boost ARR by acquiring more customers, upselling premium features or plans to existing customers, and reducing churn by making your existing customers happy.
What role does ARR play in SaaS valuations?
ARR is a significant factor in determining the valuation of a SaaS business. Investors often use ARR as an indicator of your company's growth potential and financial stability.
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