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SaaS Quick Ratio Calculator
Calculate the SaaS quick ratio: (new + expansion) / (contraction + churn).
SaaS quick ratio is a growth quality metric that compares positive MRR movements (new + expansion) to negative movements (contraction + churn).
Prefer an explanation- Read the guide.
Need definitions- Browse the glossary.
SaaS Quick Ratio: definition, formula, and how to use itMRR waterfall: reconcile starting MRR to ending MRRARR growth rate: how to measure recurring momentumARR guide: meaning, formula, MRR, bookings, and growth
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Tip: you can type commas (e.g., 10,000).
Example
Using the default inputs, the result is:
2.5:1
- New MRR
- $12,000
- Expansion MRR
- $8,000
- Contraction MRR
- $3,000
- Churned MRR
- $5,000
- Target quick ratio (optional)
- 0
How to calculate
- Measure new and expansion MRR for the period.
- Measure contraction and churned MRR for the same period.
- Compute quick ratio = (new + expansion) / (contraction + churn).
- Optional: add a target quick ratio to back-solve additions or max losses.
Formula
Quick ratio = (New MRR + Expansion MRR) / (Contraction MRR + Churned MRR)
- All movements are measured for the same period.
- Use MRR movements (not billings/cash) to keep the metric consistent.
FAQ
What is a good SaaS quick ratio-
Benchmarks vary by stage, but higher ratios generally indicate healthier growth quality (more positive MRR compared to losses). Use trends and segment-level ratios to diagnose where losses are coming from.
Common mistakes
- Using mismatched windows or definitions for movements.
- Relying on blended numbers that hide segment problems.
How to interpret
Quick ratio tips
- Track quick ratio by segment to find leaky cohorts.
- If quick ratio drops, inspect churned MRR and contraction first.
- Pair with payback and burn multiple to judge cash efficiency.
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Quick checks
- Keep time units consistent (monthly vs annual) across inputs and outputs.
- Segment by cohort/channel/plan before trusting a blended average.
- Use the related guide to avoid common definition and denominator mismatches.