Glossary · SaaS metrics
What is net revenue retention (NRR)?
Net revenue retention (NRR) is the percentage of recurring revenue a business keeps from an existing group of customers over a period, after adding expansion and subtracting downgrades and churn, excluding new customers.
Also called: NRR, Net dollar retention, NDR
Updated
How is NRR calculated?
NRR = (starting MRR + expansion − contraction − churned MRR) ÷ starting MRR × 100 GRR = (starting MRR − contraction − churned MRR) ÷ starting MRR × 100
Gross revenue retention (GRR) is the same without expansion, so it can never exceed 100%. NRR above 100% means existing customers grow faster than they leave — the business grows even with zero new customers. Usually measured over 12 months on a cohort of customers who existed at the start.
NRR example
Customers who were active a year ago paid $50,000 MRR. Today the same customers pay $56,000: $9,000 in upgrades, $1,000 in downgrades and $2,000 lost to cancellations. NRR = (50,000 + 9,000 − 1,000 − 2,000) ÷ 50,000 = 112%. GRR = (50,000 − 1,000 − 2,000) ÷ 50,000 = 94%.
Why NRR matters
NRR captures the whole value of the customer base in one number, and it compounds: a company with 120% NRR grows 20% a year before acquiring anyone. It's one of the metrics SaaS investors weigh most, because it reflects product value, pricing that scales with usage, and churn together.
Common NRR pitfalls
- Including new customers in the numerator.
- Reporting NRR without GRR — high expansion from a few accounts can hide heavy churn.
- Short windows; monthly NRR is noisy, and annualizing it is misleading.
- Flat-priced products rarely exceed 100% without usage- or seat-based pricing.
NRR and VisitTrack
NRR is a billing metric, so VisitTrack doesn't compute it. What VisitTrack adds is the origin of each customer: payments are attributed to the visitor's first-touch referrer, campaign and landing page, so you can group customers by the channel that brought them and compare how much each cohort's revenue grows or shrinks — channel-level retention. See revenue attribution.
Frequently asked questions
What is a good net revenue retention rate?
Above 100% means existing customers grow on net, which is generally considered healthy for SaaS. Products with usage- or seat-based pricing sold to larger companies often reach higher NRR than flat-priced self-serve tools.
What is the difference between NRR and GRR?
NRR includes expansion revenue from existing customers; GRR excludes it and only measures losses from downgrades and churn. GRR can't exceed 100%, NRR can.
Related terms
- Expansion revenueExpansion revenue is additional recurring revenue earned from existing customers — through plan upgrades, extra seats, add-ons or higher usage — as opposed to revenue from new customers.
- Churn rateChurn rate is the percentage of customers (or recurring revenue) that a business loses during a period, out of the customers (or revenue) it had at the start of that period.
- Retention rateRetention rate is the percentage of users or customers from a starting group who are still active — still subscribed, or still coming back — after a given period.
- Monthly recurring revenue (MRR)Monthly recurring revenue (MRR) is the predictable subscription revenue a business expects to earn every month, normalized to a monthly amount and excluding one-time payments.
- Cohort analysisCohort analysis is a method of grouping users by a shared starting event — usually the week or month they first visited or signed up — and comparing how each group behaves over the same time since that start.
Tools and guides
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