Definition
Annual Recurring Revenue (ARR) is the annualized recurring revenue a SaaS or subscription company expects to generate from its customers over a 12-month period, based on their contract terms.Explanation
Annual Recurring Revenue (ARR) represents the total value of contractually committed, recurring revenue that a business expects to receive over a 12-month period.Example: If a customer's Monthly Recurring Revenue (MRR) is €10,000, their ARR would be €120,000. This indicates an expected annual recurring revenue of €120,000 from this single customer.