The issue with your view of how ARR is being calculated is that you are not including renewal of existing contracts that are due to expire over the rolling 12 month period. In the 4C they clearly state that the ARR metric works on the assumption of all expiring contracts renewing on same terms. Its not as basic as dividing the TCV by the WAC.From what I can tell, ARR is TCV divided by the effective weighted average of contracts. With TCV of $20m and ARR of $4.36, WAC is ~4.8 years. This would have to include the $6.4m AI-RAD deal that isn't live, as such I believe ARR includes non-implemented deals. Whilst ARR is not wrong, it is a little misleading for determining Qtr to Qtr revenues as investors don't have gauge on the time from signing a deal (hence why many seem disappointed about cash receipts this quarter which are in line with implemented ARR and likely some volume growth from existing customers) to it being live as I stated in an earlier post. This is why I suggest they should report like PME when announcing new large contracts or breakdown ARR between live and not live.
I think further clarification is needed from management. Especially in relation to whether ARR includes yet to be implemented contracts or not. I suspect it doesn't.
