Billing

Monthly Recurring Revenue (MRR)

Expected monthly revenue from your subscriptions. Calculated based on the recurring price of your active and paid services, domains, addons and recurring billable items.

Formula:

[MRR = Sum of all monthly fees paid by your customers]

• Read more about Monthly Recurring Revenue For Web Hosting Business (opens new window) on our blog.
• Watch the below video tutorial:

Example 1:
An annual service priced at $120 results in an MRR of $10 (120 ÷ 12 months).
For for semi-annual billing the amount is divided by 6, quarterly by 3 and so on. The same logic applies to domains and addons.

Not included in MRR: one-time fees (e.g., Setup Fee, Late Fee) and taxes, custom invoices.
Included in MRR: payments made with Credits.

By default, MRR is calculated from services with the statuses Active and Suspended. In the application settings, you can customize how MRR is calculated. You can disable the option "MRR Calculation Based On Active Services" to limit MRR to services within a Grace Period. After the grace period expires, unpaid services with Active or Suspended status, will no longer count as active subscriptions. As a result, their MRR value will be excluded.

Where to find this setting:
Settings → My Applications → [selected application] → MRR Calculation Settings

Example 2:
Date: September 1, 2025
Service: due on August 18, 2025, currently Suspended.

If MRR Calculation Based on Active Services is enabled, the service is still included in MRR.
If this option is disabled, and the Grace Period is set to fewer than 14 days, the service is treated as Churn, and its MRR is excluded.

Annual Recurring Revenue (ARR)

• Annual Revenue Rate (ARR) is a report showing the data like the Monthly Recurring Revenue (MRR) but for a full year instead.
  Formula:

[ARR = MRR x 12]

Average Revenue Per User (ARPU)

ARPU (Average Revenue Per User) – the expected average revenue from active customers.
It is calculated using the formula:

[ARPU = MRR / number of active clients]

Active Clients also include customers with One Time and Free services.

• Read more about 5 Ways to Boost ARPU in a Web Hosting Company (opens new window) on our blog.
• Watch the below video tutorial:

Example:

• Customer A – has a recurring service for $90 USD
• Customer B – has a free service
• Customer C – has a One Time service for $100 USD

In this case:

• MRR = $90 USD
• Active Customers = 3
• ARPU = 90 / 3 = $30 USD

Average Revenue Per Paying User (ARPPU)

An expected amount of average revenue from your active paying customers.
This metric is calculated using the following formula:

[ARPPU = Monthly Recurring Revenue (MRR) / Number of active paying customers]

Active paying customers include only those with recurring services, addons, domains and items. A customer is counted only if their invoices are greater than 0. Customers with One-Time or Free billing cycles are not included in this count.

Example:

• Customer A – has a recurring service for $90
• Customer B – has a free service
• Customer C – has a One Time service for $100

In this case, the ARPPU is calculated as:

• MRR = $90 USD
• Active Paying Customers = 1
• ARPPU = 90 / 1 = $90 USD

Customer Lifetime Value (LTV)

An average estimated value of a customer through their whole life span formed on the existing customer base. This is an average calculation based on ARPU and Churn Rate. This metric may not be very "realistic" for a small sample of data (less customers than 100 is going to have a very variable Churn Rate).
Formula:

[LTV = ARPU (Average Revenue Per User) / Customer Churn Rate]   

• Read more about LTV as a Key Growth Factor for Web Hosting Companies (opens new window) on our blog.
• Watch the below video tutorial:

Example:

• If your ARPU is $10 (as in the examples above)
• You have 10 active clients now
• You had 5 clients leaving in the last 30 days
• This means that your Churn Rate is 50% (5 clients lost / 10 clients in total now)
• In such case your LTV is $20 ($10/0.5). In other words your customer leaves you $20 in average during their lifespan at your company.

Paying Customer Lifetime Value (PLTV)

This report is almost the same as Customer Lifetime Value (LTV) but the calculation is based only on the paid customers so it's based on ARPPU and Churn Rate.
Formula:

[PLTV = ARPPU (Average Revenue Per Paying User) / Customer Churn Rate]

Revenue

Total revenue calculated on the basis of the paid invoices for all types of services in the system, including custom invoices.

Accrued Revenue - you can enable this option in Settings → My Applications → Edit (application). If enabled, the system will calculate the Revenue based on the invoices marked as paid, regardless of the transactions. By default this option is disabled.

Net Revenue

Net Revenue based on paid invoices in your system excluding gateway fees and taxes.