Revenue & Sales
Basic

Net Revenue

Net revenue is gross revenue less returns, refunds and discounts — the amount actually recognised.

Formula

NR=GR−R−DNR = GR - R - D

Variables

NRNet revenue
GRGross revenue
RReturns / refunds
DDiscounts & allowances

Example

$50,000 gross − $3,000 returns − $2,000 discounts: NR = $45,000

Did You Know?

Net revenue, not gross, is what investors watch — heavy discounting can hide a shrinking real top line.

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Total Revenue

Basic

Total revenue is the selling price multiplied by the number of units sold.

Average Revenue

Basic

Average revenue is total revenue divided by units sold — equal to price per unit in a single-price market.

Marginal Revenue

Intermediate

Marginal revenue is the extra revenue earned from selling one additional unit.

Revenue Growth Rate

Basic

The percentage change in revenue from one period to the next.

Monthly Recurring Revenue

Intermediate

Monthly recurring revenue is the number of active subscribers times average revenue per user per month.

Annual Recurring Revenue

Basic

Annual recurring revenue annualises the monthly recurring revenue of a subscription business.