How much recurring revenue you keep from existing customers over a year, accounting for expansion AND churn.
NRR = (starting revenue + expansions - churns - downgrades) / starting revenue. Over 100% means your existing customer base grew revenue even without new customers, they upgraded faster than they canceled. This is the holy grail of SaaS metrics. NRR > 120% means you could stop acquiring customers and still grow.
NRR is the single most important metric for long-term SaaS health. High NRR compounds: even mediocre acquisition plus great NRR produces huge businesses. Low NRR means you're stuck on an acquisition treadmill forever.