Formula
Reactivation MRR = Σ MRR at month end of customers
with no MRR at the prior month end
and MRR at some earlier month endWorked example
Illustrative figures. Customer B churned in March and signed again in September.
| Customer | History | MRR 31 Aug | MRR 30 Sep | Movement |
|---|---|---|---|---|
| Customer A | First contract | – | 4,000 | New business 4,000 |
| Customer B | Churned in March | – | 2,500 | Reactivation 2,500 |
| Customer C | Since 2024 | 3,000 | 4,200 | Expansion 1,200 |
| Customer D | Since 2025 | 5,000 | 3,500 | Contraction (1,500) |
| Customer E | Since 2023 | 2,000 | – | Churn (2,000) |
| Customer F | Module +1,000, seats −600 | 6,000 | 6,400 | Expansion 400 |
| Total | 16,000 | 20,600 | 4,600 |
Reactivation MRR = 2,500
Why not new business
A returning customer was counted as new business once and as churn when it left. Counting the return as new business again double-counts acquisition.
Look-back windows
Some companies treat a customer returning after a long absence, such as more than twelve months, as new business. If a window is used, state it and apply it to every customer.
Effect on retention
In trailing twelve-month NRR, a customer in the starting cohort who churned and returned within the window is measured at its current MRR. Whether reactivations belong in NRR is a policy choice; disclose it.
How Revnewed calculates it
Reactivation applies when a customer returns after at least one month end at zero, with no look-back limit. It is never reported as new business.
NRR includes reactivated customers who had MRR twelve months earlier.
Common misstatements
- Win-backs as new logos
- Acquisition is overstated and the earlier churn is obscured.
- Reactivation netted against churn
- Netting the return against the earlier loss rewrites history and understates both movements.
- Undisclosed look-back window
- A window changes classification. State it in the definitions.