Churn Rate Calculator

Customer churn rate measures the percentage of customers who stop using a product or service during a given time period. It is one of the most critical metrics for subscription businesses, SaaS companies, and any recurring revenue model. High churn destroys growth even when acquisition is strong.

Monthly Churn Rate formula: Churn Rate = (Customers Lost During Period / Customers at Start of Period) × 100

Customer Retention Rate: Retention Rate = 100% − Churn Rate

Customer Lifetime Value (CLV), simplified: CLV = Average Revenue per Customer per Month / Monthly Churn Rate

That division looks odd the first time you see it, but it falls straight out of the maths: at 5% monthly churn the average customer lasts 1 ÷ 0.05 = 20 months, so 20 months of revenue is what one customer is worth.

What each variable means:

• Customers Lost: number of customers who cancelled, did not renew, or became inactive during the period
• Customers at Start: the customer count at the beginning of the measurement period (do NOT include new customers acquired during the period in the denominator)
• Churn Rate: expressed as a monthly, quarterly, or annual percentage
• Retention Rate: the flip side of churn; 5% monthly churn = 95% monthly retention = 54% annual retention (not 40%!)
• CLV: how much revenue a customer generates before churning; drives customer acquisition budget decisions

Worked example: SaaS company: 1,200 customers at start of month. 60 cancelled. 80 new customers acquired.

Churn Rate = (60 / 1,200) × 100 = 5% monthly churn End of month customers = 1,200 − 60 + 80 = 1,220 Retention Rate = 100% − 5% = 95% monthly Annual retention: (0.95)¹² = 0.54, so 54%. Put another way, 46% of the customers you have today are gone within a year.

Enter 1200 and 60 in the boxes above, with $50 of monthly revenue per customer, and every figure in this example comes back. Note that the calculator reports 1,140 remaining, not 1,220: it counts who is left out of the customers you started with, and deliberately ignores new signups. Mixing acquisitions into a churn denominator is the single most common way a churn number gets flattered.

Average revenue per customer: $50/month CLV = $50 / 0.05 = $1,000 per customer Maximum profitable customer acquisition cost (CAC) should be ≤ $333 (CLV/3 rule of thumb).

Industry benchmarks (monthly churn):

• SaaS (consumer): 3–8% | SaaS (SMB): 2–4% | SaaS (enterprise): 0.5–1%
• Mobile apps: 70–80% churn in first 30 days is normal
• Streaming services: 4–6% monthly

Cutting churn from 5% to 3% stretches the average customer life from 20 months to 33, which lifts CLV by 67%. Buying that same growth in new customers costs a great deal more.