What it is
Expansion is increased recurring revenue from existing customers — seats, editions, modules, or usage that your ARR policy treats as recurring. It is the lever that pushes NRR above 100%.
How it’s calculated
Sum positive ARR movements on logos that existed in the starting cohort. Price increases need an explicit include/exclude rule shared with sales comp and board reporting.
Where it breaks
Expansion breaks when one-time professional services are coded as ARR, when usage spikes are annualized without commitment, or when “expansion” is actually a new logo under a parent account.
In the board pack
Show expansion as its own waterfall bar. NRR without an expansion callout invites false comfort.
Keep the written definition stable across close, the board pack, and diligence so the same word never means two math models.