ARR = Annual Recurring Revenue
Add all recurring revenue from active subscriptions for one year
Include only recurring charges, not one-time fees
Exclude non-recurring revenue such as setup fees, consulting, and usage-based one-off charges
For monthly subscriptions, multiply monthly recurring revenue by 12
For quarterly subscriptions, multiply quarterly recurring revenue by 4
For annual subscriptions, use the full annual contract value
Adjust for upgrades, downgrades, cancellations, and new subscriptions
ARR = Sum of all recurring subscription revenue normalized to a yearly amount