Churn Rate Calculator
Quickly compute churn rate with accurate formulas. See amortization schedules, growth projections, and side-by-side comparisons.
Formula
Churn Rate = (Customers Lost / Customers at Start) × 100 | Retention = 100 - Churn Rate
Churn rate is the percentage of customers lost during a period. Retention rate is its complement. Annual churn compounds monthly: Annual = 1 - (1 - Monthly Rate)^12. Average customer lifetime in months = 1 / Monthly Churn Rate.
Worked Examples
Example 1: SaaS Monthly Churn
Problem: A SaaS company starts the month with 2,000 customers and loses 80. ARPU is $59/month. Calculate churn rate and revenue impact.
Solution: Churn rate: 80/2,000 = 4.0%\nRetention rate: 96.0%\nMonthly revenue lost: 80 × $59 = $4,720\nAnnual churn rate: 1 - (0.96)^12 = 38.7%\nAvg lifetime: 1/0.04 = 25 months\nLTV: 25 × $59 = $1,475
Result: 4.0% monthly churn | $4,720/mo lost | LTV: $1,475
Example 2: Low-Churn Enterprise Product
Problem: 500 enterprise customers, 5 lost this month, $299/mo ARPU.
Solution: Churn rate: 5/500 = 1.0%\nAnnual churn: 1 - (0.99)^12 = 11.4%\nMonthly revenue lost: 5 × $299 = $1,495\nAvg lifetime: 1/0.01 = 100 months\nLTV: 100 × $299 = $29,900
Result: 1.0% monthly churn | LTV: $29,900
Frequently Asked Questions
What is customer churn rate?
Customer churn rate is the percentage of customers who cancel or stop using your product during a given period. It is calculated as: Churn Rate = (Customers Lost / Customers at Start of Period) x 100. For example, if you start the month with 1,000 customers and lose 50, your monthly churn rate is 5%. Churn is the inverse of retention — a 5% churn rate means a 95% retention rate.
What is a good churn rate for SaaS?
For B2B SaaS, a monthly churn rate of 2-3% (20-30% annually) is common for SMB-focused products. Enterprise SaaS typically sees lower churn at 0.5-1% monthly (5-10% annually). B2C subscription businesses often have higher churn at 5-7% monthly. Best-in-class companies achieve under 1% monthly churn. Net revenue retention (NRR) above 100% — where expansion revenue exceeds churned revenue — is the gold standard.
How does churn rate affect customer lifetime value?
Average customer lifetime in months equals 1 divided by the monthly churn rate. With 5% monthly churn, average lifetime is 20 months. With 2% churn, it is 50 months. LTV = Average Lifetime x Revenue Per Customer Per Month. Reducing churn from 5% to 2% increases customer lifetime by 2.5x, which directly multiplies your LTV by 2.5x. This is why churn reduction is often the highest-ROI investment for subscription businesses.
What is the difference between customer churn and revenue churn?
Customer churn counts the percentage of customers lost. Revenue churn (also called MRR churn) measures the percentage of revenue lost. They can differ significantly — if only low-paying customers churn, revenue churn is lower than customer churn. Conversely, losing a few enterprise customers can cause high revenue churn with low customer churn. Track both metrics, and also track net revenue churn which accounts for expansion revenue from remaining customers.
How do I calculate churn rate?
Churn rate is the percentage of customers who stop using your product in a given period. Monthly Churn = Customers Lost During Month / Customers at Start of Month. Annual churn can be estimated as 1 - (1 - monthly churn)^12. A 5% monthly churn equals about 46% annual churn. Track both customer churn and revenue churn separately.
What formula does Churn Rate Calculator use?
The formula used is described in the Formula section on this page. It is based on widely accepted standards in the relevant field. If you need a specific reference or citation, the References section provides links to authoritative sources.