Net New Contracted MRR
Net change in contracted monthly recurring revenue in a period from new bookings, upsells, downsells, and churn.
◆ Currency
Formula
Built from
What it measures
The contracted recurring revenue your business added or lost in the period, netted across all four motions — new logos, expansions, contractions, and cancellations. It is the bookings-side waterfall that bridges starting contracted MRR to ending contracted MRR, measured on contract value at signature rather than cash collected or revenue recognized.
Why it matters
Net New CMRR is the scoreboard for whether bookings are actually building the business. New logos alone flatter you; this metric forces you to net them against the revenue walking out the door. Executives use it to tell real pipeline momentum from churn-masked stagnation, finance uses it to forecast forward ARR and cash, and sales leadership uses it to see whether growth is healthy expansion or a treadmill of replacing lost accounts.
How to read it
Read Net New CMRR as a trend, not a single number. Positive means your contracted base expanded; negative is a red flag that churn and downsells beat new and upsell. Express it as a percentage of starting CMRR to get a net growth rate, and always decompose the four parts — $40K of net adds built on $50K new and $20K churn is a far weaker business than $40K built on $45K new and $5K churn, even though both nets are identical.
What good looks like
Good
Positive Net New CMRR every month, driven by new bookings and upsell rather than a single large renewal, and holding or rising as a percentage of starting CMRR as you scale.
Watch
Net New CMRR flat or shrinking; new bookings still landing but increasingly offset by rising churn or downsells.
Bad
Sustained negative Net New CMRR — churn and contractions are outrunning new and expansion bookings, and the contracted base is eroding.
Watch-outs
- Counting a customer twice in one motion. Someone who upgrades in month 1 and cancels in month 2 belongs in Upsell CMRR in month 1 and Churned CMRR in month 2 — don't penalize both at once or net them prematurely.
- Mixing bookings with cash. Net New CMRR is a contracted-revenue flow, not collections — a multi-year deal signed in January contributes its monthly run-rate now, while the cash may arrive over the term.
- Treating downsells as zero. A downgrade is real lost CMRR; record Downsell CMRR as a positive number that reduces the net, or you will overstate growth and hide retention problems.
- Letting renewals lump the trend. Large enterprise renewals or expansions clustered in one quarter can swamp organic monthly motion — segment by booking type or cohort before concluding momentum changed.
Worked example
Hypothetical
In June you sign three new contracts worth $50K CMRR, expand two customers by $15K, downgrade one by $5K, and lose two to churn worth $20K. Net New CMRR is $40K. On a $500K starting CMRR, that is 8% net contracted growth for the month.
Variants & windows
The same metric re-expressed by a mechanical transform — a trailing window, a growth rate, a per-unit scaling, or a book/segment cut. Each is computed from Net New Contracted MRR above.
- Net New CMRR Net new