Gross vs Net Revenue Churn: GRR vs NRR Explained
Which retention metric tells the real story? Data from 939 B2B SaaS companies (Q1-Q3 2025)
Median B2B SaaS gross revenue retention (GRR) is 91%, while net revenue retention (NRR) is 103% -- a 12-point expansion gap driven primarily by seat expansion and tier upgrades. Enterprise segments show the widest gap: GRR 97% vs NRR 118%. GRR is the cleaner measure of true product retention; NRR reflects growth potential but can mask underlying churn problems (Optifai Pipeline Study, 2026, N=939 B2B SaaS companies).
Median B2B SaaS gross revenue retention (GRR) is 91%, while net revenue retention (NRR) is 103% -- a 12-point expansion gap driven primarily by seat expansion and tier upgrades. Enterprise segments show the widest gap: GRR 97% vs NRR 118%. GRR is the cleaner measure of true product retention; NRR reflects growth potential but can mask underlying churn problems. Source: Optifai Sales Ops Benchmark (N=939 companies, Q1-Q3 2025)
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GRR vs NRR at a Glance
The difference between NRR and GRR represents expansion revenue generated from existing customers. This gap widens as ACV increases -- Enterprise companies generate 21 points of expansion revenue, which can mask higher absolute churn dollars.
Source: Optifai Pipeline Study (2026, N=939 B2B SaaS companies).
GRR vs NRR by ACV Segment
| Segment | GRR | NRR | Expansion Gap |
|---|---|---|---|
| SMB ACV <$10K | 86% | 95% | +9pt |
| Mid-Market ACV $10K-$50K | 92% | 106% | +14pt |
| Upper Mid-Market ACV $50K-$100K | 95% | 112% | +17pt |
| Enterprise ACV >$100K | 97% | 118% | +21pt |
| All Segments Median | 91% | 103% | +12pt |
Source: Optifai Pipeline Study (2026, N=939 B2B SaaS companies).
What Drives the Expansion Gap?
Four sources of expansion revenue account for the difference between GRR and NRR. Seat expansion is the largest contributor, while price increases contribute the least.
Teams grow, departments adopt. The most organic form of expansion -- customers add seats as they realize value. Strongest in collaboration and productivity tools.
Customers move from Basic to Pro, or Pro to Enterprise. Driven by feature gating and usage limits. Requires clear value differentiation between tiers.
Selling additional products to existing customers. Requires a multi-product portfolio. Higher-ACV companies have more cross-sell surface area.
Annual price adjustments or inflation-linked increases. The least sustainable expansion source -- overuse accelerates churn in subsequent periods.
Source: Optifai Pipeline Study (2026, N=939 B2B SaaS companies). Contribution ranges reflect interquartile range across segments.
When GRR Matters More Than NRR
NRR gets the headlines, but GRR often tells a more honest story. There are three situations where GRR should be your primary retention metric.
Investors increasingly ask for GRR alongside NRR. A company reporting 110% NRR with 82% GRR raises a red flag: 18% annual gross churn means nearly one in five customers leaves every year. The expansion revenue that compensates today may not be sustainable at scale.
GRR is a leading indicator of product-market fit. If GRR is declining quarter over quarter, no amount of expansion can fix the underlying problem. Track GRR on a cohort basis -- does retention improve for newer cohorts as the product matures?
NRR can be inflated by aggressive upselling or forced price increases. GRR strips away those factors and answers a simpler question: are customers staying? If GRR is below 85%, the product has a retention problem that expansion is masking.
Key Insights
- The expansion gap widens with ACV: Enterprise companies (ACV >$100K) show a 21-point gap between GRR and NRR, compared to just 9 points for SMB. Larger accounts have more seats to add, more modules to adopt, and more budget for tier upgrades.
- GRR below 85% is a warning sign: Even with strong expansion, a GRR under 85% means you are replacing more than 15% of your revenue base annually. At that rate, you need significant new business just to stay flat.
- Seat expansion is the healthiest growth lever: Contributing 5-8 percentage points to NRR, seat expansion reflects organic adoption within customer organizations. It correlates with product stickiness and is more durable than price-driven expansion.
- Price increases are the weakest lever: While contributing 1-3 points, price increases carry risk. Companies that rely on annual price hikes for NRR tend to see GRR deterioration in the following period as customers reassess value.
- Report both metrics together: GRR and NRR are complementary. GRR shows retention quality; NRR shows growth potential. Presenting them side by side gives investors, board members, and operators a complete picture of customer economics.
Source: Optifai Pipeline Study (2026, N=939 B2B SaaS companies).
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Methodology
This analysis compares gross revenue retention (GRR) and net revenue retention (NRR) from 939 B2B companies between Q1-Q3 2025. GRR excludes expansion revenue; NRR includes it. Both are calculated on a trailing 12-month basis using MRR cohort data.
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Update History
Data last updated: February 16, 2026
- ✓Evergreen formatting: titles and headings no longer include year references
- ✓Metadata centralized for consistency across all benchmark pages
- ✓Initial release of GRR vs NRR benchmark page
- ✓Expansion gap analysis by ACV segment from Optifai benchmark (N=939)
- ✓Added expansion source breakdown (seat, upsell, cross-sell, price)
- ✓Included guidance on when GRR matters more than NRR
Impacted metrics:
Regularly updated with latest industry data
Optifai Research Team
VerifiedLed by Yusuke Onishi (Founder & CEO) with 15+ years of B2B sales operations experience. Our research team analyzes pipeline data from 939+ companies to deliver actionable benchmarks for sales leaders.