Expansion MRR is the additional monthly recurring revenue earned from existing customers through upgrades, cross-sells, or increased usage, excluding new customers. It is the component of MRR growth that comes from your current base, and a primary driver of net revenue retention above 100%.

Expansion MRR is the cheapest recurring revenue you can add, because it comes from customers you already won and already serve. Tracking it separately from new MRR shows whether your existing base is a growth source or just a bucket you are refilling. A business generating strong expansion MRR grows even when new sales are slow, which is a far more resilient position.

Example:

Existing customers upgrading their plans add $12k in monthly recurring revenue this month, entirely separate from any new customers won.

Why track expansion MRR separately?

It shows how much growth comes from your existing base versus new sales, revealing whether current customers are a source of growth or just offsetting churn.

How does expansion MRR relate to net revenue retention?

Strong expansion MRR is what pushes net revenue retention above 100%, meaning the existing base grows revenue without any new customers.