SaaS Churn Rate Calculator
Calculate your customer and revenue churn metrics to track business health.
Results Overview
Understanding SaaS Churn Rate Calculation
For SaaS (Software as a Service) companies, churn rate is the most critical metric for long-term viability. It measures the rate at which your customers cancel their subscriptions. A high churn rate acts as a "leaky bucket," requiring significant marketing spend just to stay level.
1. Customer Churn Rate
This is the percentage of customers who left during a specific period. It focuses purely on the logo count, not the dollar value.
Formula: (Lost Customers / Customers at Start of Period) x 100
2. Gross MRR Churn
Monthly Recurring Revenue (MRR) churn tracks the actual revenue lost from cancellations and downgrades. This is often more important than customer churn because losing a high-paying enterprise client has a much larger impact than losing a low-tier user.
Formula: (Lost MRR / Starting MRR) x 100
3. Net MRR Churn
This is the "gold standard" of SaaS metrics. It accounts for "Expansion Revenue"—money gained from existing customers who upgrade or buy more seats. If your Net MRR Churn is negative, it means your existing customer base is growing even if some people leave.
Formula: [(Lost MRR – Expansion MRR) / Starting MRR] x 100
Practical Example
Imagine your SaaS starts the month with 100 customers and $10,000 in MRR. During the month:
- 5 customers cancel ($500 lost MRR).
- Remaining customers upgrade their plans, adding $200 in expansion revenue.
Calculations:
- Customer Churn: 5 / 100 = 5%
- Gross MRR Churn: $500 / $10,000 = 5%
- Net MRR Churn: ($500 – $200) / $10,000 = 3%