Annual Recurring Revenue (ARR) is the yearly value of recurring revenue from subscriptions of standalone and bundle option products. ARR is calculated using the below formula:

ARR = Monthly Recurring Revenue (MRR) *12

or

ARR = (Net Price/Total Selling Term) *12, where the frequency of the term is monthly.

The existing "Asset ARR" field is used of asset line items and the ARR is recalculated after any pricing or term change, supporting all charge types, ramp lines, and product types. ARR is not calculated for one-time lines, which display a value of zero.

Example 1: New selling term is 12 months, Net Price = 1200/- and hence ARR = (1200/12) *12 = 1200

Example 2: New selling term is 18 months, Net Price = 2000/- and hence ARR = (2000/18)*12 = 1333

Annual Contract Value (ACV) measures the average annual value of a customer contract. Unlike ARR, it is customer-specific. It is useful for sales teams to understand the value of deals. They can identify Average ACV on Quote level and on Account level.

ACV = Total Contract Value / Contract Duration (in years)

The amount is displayed as a field on the Asset line item. The system recalculates ACV after each pricing change, supporting bundles, options, rollup lines, charge type, recurring, one-time, and ramp line items.

Example 1: If Total Contract Value (TCV) = $4500 and total Contract Duration =5 yrs then ACV=4500/5= $900

Example 2: Multi year ramp line: 3 year ramp asset with 10% annual uplift, base price=$100, frequency=monthly recurring.

Monthly Recurring Revenue (MRR) gives a short-term view of revenue. Helps track growth, churn, and expansion month over month.

MRR = Annual Recurring Revenue/12

MRR automatically updates when ARR is recalculated and excludes one-time lines, providing accurate monthly revenue metrics for finance, sales, and operations teams.

The amount is displayed as a field on the Asset line item. MRR is recalculated after each pricing change, supporting all recurring bundles, options, rollup lines, and ramp line items.