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Revenue
Annual Recurring Revenue (ARR)
Annual Recurring Revenue (ARR) is the normalized, predictable subscription revenue a SaaS business expects over a 12-month period from active contracts, excluding one-time fees, services, and usage overages. It is typically calculated as MRR multiplied by 12, and serves as the headline growth metric for SaaS companies with annual contracts. ARR is a snapshot of contracted run-rate revenue at a point in time, not a measure of revenue already booked under GAAP.
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