[GTM glossary](/glossary.md) Net dollar retention GTM Strategy & SaaS Metrics # Net dollar retention (NDR) In short Net dollar retention (NDR) is the percentage of recurring revenue you retain from a set of existing customers over a period, after counting expansion, downgrades, and cancellations. Above 100% means expansion outweighs losses. NDR is most often used as another name for net revenue retention. Some teams keep the label for dollar-based measures and use net revenue retention in reports to investors. Check each definition before comparing numbers. ## How to calculate net dollar retention Take a cohort of customers at the start of a period, usually 12 months. Measure their recurring revenue now and divide by what they paid at the start. Ignore revenue from customers who joined later. Say the cohort paid $1,000,000 a year ago. Today it pays $1,100,000 after $180,000 of upsell, $50,000 of downgrades, and $30,000 of churn. NDR is 110%. * **Formula:** (starting revenue + expansion - downgrades - churn) / starting revenue. * **Cohort only:** New customers are excluded, so growth from new logos never inflates it. --- ## What NDR tells a GTM team * **Above 100%:** The installed base grows on its own, so new sales add to growth rather than replace losses. * **Below 100%:** The base is shrinking. Acquisition has to work harder just to stand still. * **Where to act:** Split NDR into expansion, contraction, and churn to see whether the fix sits with customer success, product, or targeting. --- ## NDR vs. gross revenue retention Gross revenue retention counts only losses and caps at 100%, so it shows how leaky the bucket is. NDR adds expansion, so it shows whether growth in existing accounts covers the leaks. Read both together. --- ## How to improve NDR * **Sell to the right accounts:** Customers that match your ideal profile churn less and expand more. * **Time expansion plays:** Use product usage and new hires or funding as triggers for upsell outreach. * **Manage renewals early:** Start renewal work months ahead and flag at-risk accounts. --- ## Net dollar retention FAQs **What is net dollar retention (NDR)?** Net dollar retention is the percentage of recurring revenue kept from an existing customer cohort over a period, after counting upsell, downgrades, and churn. A figure above 100% means expansion more than offsets lost revenue. **How do you calculate net dollar retention?** Take the starting recurring revenue of a customer cohort, add expansion, subtract downgrades and churn, and divide by the starting revenue. Exclude customers who joined after the period began. Multiply by 100 to express it as a percentage. **Is net dollar retention the same as net revenue retention?** In most B2B SaaS usage, yes. Both measure retained recurring revenue from existing customers including expansion. Some companies define them slightly differently, for example around usage or contract basis, so confirm the formula before comparing figures. **Can net dollar retention be above 100%?** Yes. It exceeds 100% when expansion revenue from existing customers is larger than revenue lost to churn and downgrades. It means the customer base would grow even if you signed no new customers. Share term --- ## More related phrases * [Capped retention rate (CRR)](/glossary/capped-retention-rate.md) * [Logo retention](/glossary/logo-retention.md) * [Churn rate](/glossary/churn-rate.md) ## Similar phrases * [Net revenue retention (NRR)](/glossary/net-revenue-retention.md) Net revenue retention (NRR) measures how recurring revenue from existing customers changes over time, including upsell, downgrades, and churn. * [Revenue churn](/glossary/revenue-churn.md) Revenue churn is the share of recurring revenue lost in a period to cancellations and downgrades, shown as a percentage of revenue at the start of the period. * [Customer retention](/glossary/customer-retention.md) Customer retention is a company’s ability to keep customers over time, measured by how many renew or continue buying during a given period. * [Gross revenue retention (GRR)](/glossary/gross-revenue-retention.md) Gross revenue retention (GRR) is the percentage of recurring revenue a company keeps from existing customers after churn and downgrades, excluding any expansion revenue. * [Expansion revenue](/glossary/expansion-revenue.md) Expansion revenue is the additional revenue a company earns from existing customers through upsells, cross-sells, added seats, or higher usage.