What is Net MRR Movement?
Net MRR movement is the total change in MRR over a period once every movement is added up: new business, expansion and reactivation on one side, contraction and churn on the other. It is the bridge between where MRR started and where it ended.
The value of the breakdown is that it explains a number rather than reporting it. Two months can both add $2,000 of MRR while telling completely different stories: one built on new logos, the other on expansion from existing customers that barely covered heavy churn.
The identity always holds. Starting MRR plus net movement equals ending MRR, and if it does not, a movement has been miscategorized or missed. That property makes the breakdown a useful check on the pipeline that produced it.
How to calculate Net MRR movement
Net MRR movement = new business + expansion + reactivation − contraction − churn
- new business
- MRR from customers who were not paying at the start of the period
- expansion
- increases on existing customers
- reactivation
- previously churned customers returning
- contraction
- decreases on customers who stayed
- churn
- MRR lost to cancellations
The identity it must satisfy
ending MRR = starting MRR + net MRR movement
Net MRR movement example
Given
- Starting MRR: $48,000
- New business $3,200, expansion $1,450, reactivation $300
- Contraction $820, churn $1,900
The month grew 4.6%, and more than half of the gain came from new business. Without the breakdown, that $2,230 looks like durable growth rather than a treadmill.
Why Net MRR movement matters
- It turns MRR from a number into an explanation, which is what makes a board conversation about growth productive rather than speculative.
- It exposes the treadmill: heavy new business masking heavy churn nets out to modest growth and looks fine until acquisition slows.
- Every retention metric is assembled from these components, so the breakdown is where a disagreement between two metrics gets diagnosed.
Common Net MRR movement mistakes
Reading the net figure without the components
Net movement of zero can mean nothing happened or that $10,000 of expansion exactly offset $10,000 of churn. Those are not the same month.
Letting the identity break
If starting MRR plus net movement does not equal ending MRR, something is being counted twice or not at all. Currency conversion is a frequent culprit.
Comparing a partial month against full ones
The current period is still accumulating. Its movement bar is not comparable to a closed month until the month closes.
How Kometrics computes Net MRR movement
The dashboard's MRR breakdown card is exactly this bridge for the current period, one row per movement type with the customer count behind each, closing on the net figure. Because every row comes from the same ledger that produces MRR, the identity holds by construction rather than by reconciliation.
Kometrics reports movements two ways, and the distinction is worth understanding. The MRR Movements report sums raw movements, so one customer can appear in several rows. The Net MRR Movements report first combines each customer's movements within the period into a single net movement, so each customer lands in exactly one category. Gross and net churn rates draw on those two views respectively, which is why they can differ by more than you would expect.
Related terms
MRR is the normalized monthly value of every active subscription you have right now. It is a run rate, not a cash figure: it answers what a month of your current book is worth, not what landed in the bank.
Expansion MRRExpansion MRR is the additional recurring revenue you earn from customers you already have. Upgrades to a higher plan, extra seats, add-on modules and price increases all count; a new customer never does.
Contraction MRRContraction MRR is recurring revenue lost from customers who stayed: downgrades, removed seats, dropped add-ons and expired discounts running the other way. The customer is still yours, they are simply worth less.
Churn rateChurn rate is the share of your customers, or of your revenue, that you lost during a period. Which of the two you mean changes the number substantially, so the qualifier matters as much as the figure.
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Kometrics connects to Stripe, Paddle, Creem and Asaas and computes Net MRR movement continuously, with every movement behind it. Free under $1,000 MRR.
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