Common events that affect Monthly Recurring Revenue (MRR) totals

The four major ways to change Monthly Recurring Revenue (MRR) are through new subscriptionsexpansionscontractions, and churn.

New Subscriptions

This occurs when a new or existing customer starts a new active subscription, or upgrades from a free subscription to a paid subscription.

Expansion

This occurs when an existing paid subscription is upgraded or modified to increase its MRR. This can happen by adding or changing a plan, increasing the quantity, or lowering a discount.

Contractions

This occurs when an existing paid subscription is downgraded or modified to decrease its MRR (to a non-zero amount). This can happen by removing or changing a plan, lowering the quantity, or increasing a discount.

Churn

This occurs when an existing paid subscription is either canceled, downgraded to a free subscription, or becomes delinquent. Note that when the trial ends on a new subscription for a customer without a saved payment method, the subscription briefly moves from status=trialing to status=active before the first invoice fails payment, and the subscription becomes status=past_due.

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