Net MRR Churn
The Net MRR Churn Rate report tracks the total percentage of Monthly Recurring Revenue (MRR) lost or gained from an existing customer cohort. This metric is the net result of all forms of MRR change among existing customers: Expansion, Reactivation, Contraction, and Churn.
This metric is the inverse of Net Revenue Retention (NRR). While MRR Churn Rate focuses only on losses, Net MRR Churn Rate provides a comprehensive view of whether an existing customer base is growing or shrinking financially.
Net MRR Churn Rate is calculated by dividing the net change in MRR (Contraction + Churned MRR - Expansion - Reactivation) during a period by the total MRR at the start of that period.
For an in-depth explanation of net MRR churn as a metric, see the Net MRR churn guide in the SaaS Metrics Academy.
Overview
The Net MRR Churn Rate report includes a timeline chart and a breakdown table. This report is critical because it determines whether expansion revenue is successfully offsetting revenue leakage. The breakdown table cells are not clickable and there is no detail table.
Timeline chart
The timeline chart displays the Net MRR churn rate over time.
The report employs the same month-to-month calculation convention as other MRR reports to ensure consistent data over time.
Breakdown table
The table underneath the chart displays a cohort-based view for each period, making it explicit that each data point compares today's state to the cohort that existed 1 or 12 months ago (depending on the trailing window selected).
| Metric | Description |
|---|---|
| Original | The MRR contributed by the cohort at the start of the lookback window (1 or 12 months earlier). This is the cohort MRR being measured. |
| Retained | The MRR from those original customers that is still being paid at the end of the period. |
| Churned | The MRR lost from original customers who canceled all paid subscriptions during the lookback window. |
| Expansion | The MRR gained from original customers upgrading or adding more seats/products during the lookback window. |
| Reactivation | The MRR gained from former, churned customers who started a new paid subscription during the lookback window. |
| Contraction | The MRR lost from downgrades (e.g., switching to a cheaper plan or fewer seats) by original customers during the lookback window. |
| Net MRR Churn Rate | The final calculated net churn rate ((Contraction + Churned - Expansion - Reactivation) / Original), displayed as a percentage. This value can be negative (e.g., -5% indicates Negative Churn). |
Customers acquired inside the lookback window are excluded — they were never part of the cohort being measured.
Choosing the trailing window
The chart toolbar includes a trailing window selector that lets you switch between two ways of measuring net MRR churn:
Trailing 1 month (default)
Each point compares today's cohort MRR to the cohort MRR 1 month earlier. This matches typical monthly retention reporting and is the right view for operational use — tracking expansion vs. churn dynamics month over month.
Trailing 12 months (TTM)
Each point compares today's cohort MRR to the cohort MRR 12 months earlier. The 12-month view smooths out volatile months and matches how investors and benchmarks typically discuss annual net retention. Use it for board reporting and to confirm whether the long-term expansion engine is offsetting churn.
In both modes, customers acquired inside the lookback window are excluded from the calculation — they were never part of the cohort being measured against.
A worked example
Suppose you're looking at the trailing 1-month view as of Apr 30, 2026. The cohort is every customer paying on Mar 31, 2026:
| Customer | On Mar 31, 2026 | What happens by Apr 30 | In cohort? | Effect on Net MRR Churn |
|---|---|---|---|---|
| Anna | Paying $100/mo | Still paying $100 | ✓ Yes | $0 (no change) |
| Ben | Paying $100/mo | Upgrades to $150 | ✓ Yes | −$50 (expansion offsets churn) |
| Cleo | Paying $200/mo | Downgrades to $120 | ✓ Yes | +$80 contraction |
| Dan | Paying $100/mo | Cancels on Apr 12 | ✓ Yes | +$100 churn |
| Eli | Not a customer | Signs up Apr 5 at $200 | ✗ No | Excluded — joined inside the window |
| Fiona | Churned back in Jan 2026 | Reactivates Apr 18 at $150 | ✗ No | Excluded — wasn't paying on Mar 31 |
- Original MRR = $500 (Anna + Ben + Cleo + Dan)
- Net MRR change = +$80 + $100 − $50 = +$130 net loss
- Net MRR churn rate = $130 ÷ $500 = 26%
The key thing this metric does that gross MRR Churn does not: Ben's $50 upgrade is subtracted from churn — that's what makes this "net". If Ben had upgraded by $200 instead of $50, net churn would actually go negative (also called Net Negative Churn), meaning the cohort grew.
Eli's $200 and Fiona's $150 are real revenue but don't enter this cohort — Eli joined inside the window, and Fiona wasn't paying when the window opened. Both will be tracked in their own future cohorts.
The trailing 12-month view follows exactly the same logic with a wider window — cohort = everyone paying on May 1, 2025, comparison runs through Apr 30, 2026:
| Customer | On May 1, 2025 | What happens by Apr 30, 2026 | In cohort? | Effect on Net MRR Churn |
|---|---|---|---|---|
| Anna | Paying $100/mo | Doubles to $200 | ✓ Yes | −$100 (expansion) |
| Greg | Not a customer | Signs up Sep 2025 at $300, churns Mar 2026 | ✗ No | Excluded — joined inside the 12-month window |
| Hana | Paying $200/mo | Churns Aug 2025, reactivates Mar 2026 at $200 | ✓ Yes | $0 — back to her original $200 at the end |
A wider window means more customers join and leave inside it, so more get excluded — but only the starting cohort feeds Original and the net movements measured against it.
Filters
The report supports a wide range of filters to help you analyze where revenue is being retained or lost. These include:
- Date range
- Interval (Daily, weekly, monthly, quarterly, or yearly)
- Additional filters – plan, region/country, billing frequency, etc. (see all filters)
Filters are applied to both the chart and the table simultaneously.
Exporting the data
You can export the table as a CSV file for offline analysis or reporting by clicking the "Export" icon next to the date picker.
Practical tips
- Aim for Negative Churn: The ultimate goal is to keep the Net MRR Churn Rate in negative territory (e.g., -5% or -10%). This is the equivalent of an NRR rate of 105% or 110%, respectively.
- Identify Drivers: If the Net MRR Churn Rate is positive (in the red), use the Breakdown table to quickly determine the cause: Is the issue primarily Churned MRR (lost customers) or is Contraction MRR (downgrades) the main problem?
- Expansion Effectiveness: Segmenting this report by product plan or feature usage can show which customer segments are providing the most powerful Expansion MRR to offset losses.
