How to Calculate Net Revenue Retention (NRR)

Step-by-step guide to calculating and interpreting NRR for SaaS businesses.

NRR is the single most important metric for SaaS valuation. It tells you whether your existing customer base is growing or shrinking, independent of new sales.

The NRR Formula

NRR = (Starting MRR + Expansion MRR - Contraction MRR - Churned MRR) / Starting MRR × 100

Interpreting NRR

Above 120%: elite. Customers are expanding significantly.
100-120%: healthy. Growth from existing customers covers churn.
90-100%: concerning. High churn is eroding expansion gains.
Below 90%: critical. The business is shrinking without new sales.

Frequently Asked Questions

What is the difference between NRR and GRR?

Gross Revenue Retention only measures revenue retained (excluding expansion). NRR includes expansion. GRR shows churn severity; NRR shows overall health including upsell.

ChurnLens — SaaS churn analytics and revenue retention intelligence. Learn more →

80%
Overpay for Churn

4.2×
Real vs Reported

$340K
Avg Overpayment

23
Audit Checklist Points

The seller's churn number is almost always wrong. Upload the CSV and find out before you wire.

Get the Free Checklist →

🛡️ Free Starter tier: 1 CSV analysis per month. No credit card. Verify a seller's churn claims before you commit.