The total yearly revenue you can predict from subscriptions or contracts.
ARR is the dollar amount of subscription revenue you'd collect over the next 12 months if NOTHING changed, no new customers, no cancels. It's the headline metric for SaaS and any subscription business, because it smooths out monthly noise and captures the size of the recurring business.
ARR is how SaaS talks to itself. If you're running or investing in a subscription business, you live in ARR. Month-to-month revenue matters less than whether ARR is growing, what the growth rate is, and what the retention looks like under the hood.