ARR is an acronym for Annual Recurring Revenue, a metric for SaaS or subscription businesses with term subscriptions. ARR is the value of the contracted recurring revenue components of your term subscriptions normalized to a one year period.
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There can be significant confusion over the term itself, the use, and the measurement of Annual Recurring Revenue because it feels and sounds like a measure of “revenue” in the context of revenue recognition.

There can be significant confusion over the term ARR, its use and the measurement of ARR because it feels and sounds like a measure of “revenue” in the context of revenue recognition. However, ARR is not necessarily a measure of recognized revenue.
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