NRR

NRR - Net Revenue Retention, net revenue retention. The revenue from a group of clients a year ago is taken and compared with how much the same group brings in now, taking into account those who left, those who lowered their tariff and, conversely, those who expanded their subscription.

Formula: revenue of a cohort at the end of the period divided by the revenue of the same cohort at the beginning, as a percentage. New clients are not included in the calculation at all - this is the meaning of the indicator.

An NRR above one hundred percent means that the base is growing on its own: extensions are blocking the outflow. Such a company increases revenue even if it completely stops attracting. NRR below one hundred means that the base is leaking, and growth is supported only by the influx of new ones.

This is why NRR is considered a key metric in subscription models: it separates product health from marketing effectiveness. High inflows can mask a leaking base for years—until the inflow slows.