Accounting Annual Recurring Revenue Calculator Examples
Worked ARR bridge examples showing how recurring revenue movements affect ending ARR, growth, and retention.
These examples demonstrate how the same ARR bridge handles early-stage growth, strong existing-customer expansion, and a period with elevated customer losses.
Example 1: Early-stage subscription business growth
New customer acquisition is the main contributor to ARR growth.
Input Summary
Beginning ARR
$300,000
New customer ARR
$120,000
Expansion ARR
$20,000
Contraction ARR
$5,000
Churned ARR
$15,000
Calculation Breakdown
- 1Net new ARR$120,000 + $20,000 - $5,000 - $15,000$120,000
- 2Ending ARR$300,000 + $120,000$420,000
- 3ARR growth rate($120,000 / $300,000) × 10040.0%
- 4GRR(($300,000 - $5,000 - $15,000) / $300,000) × 10093.3%
- 5NRR(($300,000 + $20,000 - $5,000 - $15,000) / $300,000) × 100100.0%
Result Summary
NRR
100.0%
Accounting Annual Recurring Revenue Calculator
Ending ARR is $420,000, with $120,000 in net new ARR and 40.0% ARR growth.
Example 2: Mature business with expansion-led retention
Existing-customer growth outweighs contraction and churn.
Input Summary
Beginning ARR
$5,000,000
New customer ARR
$400,000
Expansion ARR
$700,000
Contraction ARR
$150,000
Churned ARR
$250,000
Calculation Breakdown
- 1Net new ARR$400,000 + $700,000 - $150,000 - $250,000$700,000
- 2Ending ARR$5,000,000 + $700,000$5,700,000
- 3ARR growth rate($700,000 / $5,000,000) × 10014.0%
- 4GRR(($5,000,000 - $150,000 - $250,000) / $5,000,000) × 10092.0%
- 5NRR(($5,000,000 + $700,000 - $150,000 - $250,000) / $5,000,000) × 100106.0%
Result Summary
NRR
106.0%
Accounting Annual Recurring Revenue Calculator
Ending ARR is $5,700,000, and net revenue retention is 106.0%.
Example 3: Revenue loss despite new customer sales
Customer churn and contraction are greater than new ARR and expansion combined.
Input Summary
Beginning ARR
$1,200,000
New customer ARR
$100,000
Expansion ARR
$40,000
Contraction ARR
$90,000
Churned ARR
$180,000
Calculation Breakdown
- 1Net new ARR$100,000 + $40,000 - $90,000 - $180,000-$130,000
- 2Ending ARR$1,200,000 - $130,000$1,070,000
- 3ARR growth rate(-$130,000 / $1,200,000) × 100-10.8%
- 4GRR(($1,200,000 - $90,000 - $180,000) / $1,200,000) × 10077.5%
- 5NRR(($1,200,000 + $40,000 - $90,000 - $180,000) / $1,200,000) × 10080.8%
Result Summary
NRR
80.8%
Accounting Annual Recurring Revenue Calculator
Ending ARR is $1,070,000, with negative net new ARR of $130,000.
How to Read Your Results
Ending ARR is the recurring revenue run rate at the end of the selected period.
Net new ARR shows the dollar change after additions and losses.
ARR growth rate compares net new ARR with the opening ARR balance.
GRR focuses on recurring revenue preserved from the opening customer base before expansion.
NRR includes expansion from existing customers but does not include new customer ARR.
Assumptions & Important Notes
- All examples use annualized recurring revenue and one consistent currency.
- New ARR, expansion, contraction, and churn relate to the same reporting period.
- Loss amounts are shown as positive values before they are subtracted.
- The calculations exclude one-time and non-recurring revenue.
Related Examples
Frequently Asked Questions
Can ARR growth be negative when new customer ARR is positive?
Yes. ARR growth is negative if contraction and churn exceed new customer ARR plus expansion ARR.
What does NRR of 100% mean?
It means expansion ARR exactly offsets contraction and churn within the opening customer base.
Does GRR include upsells?
No. Gross revenue retention excludes expansion or upsell ARR.
Can a company have positive NRR but low total ARR growth?
Yes. Existing customers may expand while new customer ARR remains limited.
Ready to calculate your own result?
Use the live calculator with your own inputs, timing, and preferences.