Metrics explained
What is MRR for a Shopify app, and how Lunvo calculates it
MRR is the single number that tells you how your Shopify app business is really doing month to month. Here is what it means and exactly how Lunvo computes it from your Partner data.
MRR, monthly recurring revenue, is the normalized monthly value of your active Shopify app subscriptions. Lunvo computes it from the recurring charges in the Shopify Partner API: it uses gross amounts, counts each active subscription per charge, and normalizes annual plans to one twelfth per month. New subscriptions add MRR, upgrades add expansion, downgrades subtract as contraction, and cancellations subtract as churn. ARR is simply MRR multiplied by 12.
What MRR means for a Shopify app
MRR is the predictable revenue your active subscriptions produce each month. It is a run rate, not a billing total: a merchant on a $20 monthly plan adds $20 to MRR, whether or not they were billed today.
How Lunvo calculates it
Lunvo reads your recurring charges from the Shopify Partner API and sums the active subscriptions as of the end of the period, on gross amounts. Annual plans are normalized to one twelfth per month, and metered usage is added as a trailing 30 day run rate, so your MRR reads the same whether you look at 7, 30 or 90 days.
Expansion, contraction and churn
Lunvo breaks down how MRR moved versus the previous period. A new subscription is new MRR, an upgrade is expansion, a downgrade is contraction, and a cancellation is churn. Seeing these separately tells you whether growth comes from new merchants or from your existing base.
MRR vs ARR vs one-time charges
MRR is monthly. ARR is the annual run rate, MRR multiplied by 12. One-time charges and adjustments are revenue, but they are not recurring, so they are not part of MRR. Lunvo keeps them separate so your recurring base stays clean.
See also
FAQ
What is MRR for a Shopify app?
MRR, monthly recurring revenue, is the normalized monthly value of your active Shopify app subscriptions. It is a run rate that shows the predictable revenue your subscriptions produce each month.
How is MRR different from total revenue?
Total revenue is everything billed in a period, including one-time charges. MRR is only the recurring part, normalized to a month, so it reflects the stable base of your business rather than spikes.
Does MRR include one-time or usage charges?
Usage is included as a trailing 30 day run rate, because it recurs. Pure one-time charges and adjustments are not, so they sit outside MRR while still counting in your total revenue.
What is the difference between MRR and ARR?
MRR is the monthly run rate. ARR is the annual run rate, equal to MRR multiplied by 12. They measure the same thing over different horizons.
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