Annual Recurring Revenue

Annual Recurring Revenue (ARR) is a key metric that every product manager needs to understand. It represents the total amount of predictable revenue that a company expects to receive from its customers over the course of a year. Think of it like a subscription service: if you have 100 customers paying $100 per month, your ARR would be $120,000. ARR is essential because it helps product managers gauge the financial health of a business and make informed decisions about growth strategies and product development.