# Annual recurring revenue (ARR): Formula and dbt YAML | Silicon

URL: https://meetsilicon.com/metrics/annual-recurring-revenue/

> Annual recurring revenue is the yearly value of all active recurring subscriptions, usually calculated as MRR x 12.

## Formula
ARR = MRR x 12
## Why it matters
ARR is the standard headline figure for SaaS companies and the basis for most valuation and planning conversations.
## Common pitfalls
- Do not include one-time services revenue.
- Be explicit about whether trials and paused accounts count.
## Define it in dbt for Silicon
Add this to your model's YAML. Aggregate metrics sit under a column's meta.metrics; ratios are type: number metrics that reference other metrics. Rename models and columns to match your project.
schema.yml Copy
models:
- name: fct_subscriptions
meta:
metrics:
arr:
type: number
sql: ${mrr} * 12
description: Annual recurring revenue
columns:
- name: monthly_amount
meta:
metrics:
mrr:
type: sum
filters:
- is_active: true
description: Monthly recurring revenue
Once it's defined, anyone can ask about annual recurring revenue in plain English and get an answer built on this definition. See the metrics reference for every option.
## Related
- Monthly recurring revenue (MRR) ->
- Net revenue ->
- Average order value (AOV) ->
- Gross margin ->
- Semantic layer ->
## Tell us where your data lives today.
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