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Calculators / Business / Customer lifetime value
Customer lifetime value calculator
Estimate subscription customer value from revenue, margin and churn.
On this page
Estimated lifetime gross profit1,200
Estimated customer lifetime20months
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How to calculate
Estimate subscription customer value from revenue, margin and churn.
Estimated lifetime gross profit = revenue*margin/100/(churn/100); Estimated customer lifetime = 100/churn
Worked example
Monthly revenue per customer: 100; Gross margin (%): 60; Monthly customer churn (%): 5.
Estimated lifetime gross profit: 1,200 ; Estimated customer lifetime: 20 months.
Assumptions and limits
It assumes stable monthly churn and similar customers. Young cohorts, expansion revenue, irregular buying and changing retention can make the estimate misleading.
Results are rounded for display; calculations use unrounded values. Read our calculation methodology.
Understanding the result
This subscription model estimates lifetime gross profit using constant revenue, margin and churn. It is not a discounted cash-flow valuation.
When this tool is useful
Estimate subscription customer value from revenue, margin and churn.
Understanding your inputs
| Input | What to enter |
|---|---|
| Monthly revenue per customer | Enter a number of at least 0 and no more than 1000000000000. |
| Gross margin (%) | Enter a number of at least 0 and no more than 100. |
| Monthly customer churn (%) | Enter a number of at least 0.001 and no more than 100. |
Frequently asked questions
When is this estimate unreliable?
It assumes stable monthly churn and similar customers. Young cohorts, expansion revenue, irregular buying and changing retention can make the estimate misleading.