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SaaS Churn & Lifetime Value (LTV) Calculator

Calculation Results:

Churn Rate 0%
Avg Customer Lifetime 0 Months
Customer Lifetime Value (LTV) $0.00
function calculateSaaSMetrics() { var startCust = parseFloat(document.getElementById('start_customers').value); var lostCust = parseFloat(document.getElementById('lost_customers').value); var arpu = parseFloat(document.getElementById('avg_revenue').value); var margin = parseFloat(document.getElementById('gross_margin').value) / 100; if (isNaN(startCust) || isNaN(lostCust) || isNaN(arpu) || isNaN(margin) || startCust 0 ? (1 / churnRate) : 0; var ltv = arpu * margin * lifetime; document.getElementById('res_churn').innerText = churnPercent.toFixed(2) + "%"; document.getElementById('res_lifetime').innerText = (churnRate > 0 ? lifetime.toFixed(1) : "∞") + " Months"; document.getElementById('res_ltv').innerText = "$" + (churnRate > 0 ? ltv.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) : "N/A"); document.getElementById('results_area').style.display = 'block'; }

Understanding SaaS Churn and LTV Logic

In the Software as a Service (SaaS) industry, your growth depends on two primary levers: how many customers you acquire and how many you keep. This calculator helps you determine the health of your subscription business by analyzing your Churn Rate and Customer Lifetime Value (LTV).

How Churn Rate is Calculated

Customer Churn Rate is the percentage of your customers who leave your service during a specific time period. The formula used in this calculator is:

Churn Rate = (Customers Lost during Period / Customers at Start of Period) x 100

Calculating Customer Lifetime Value (LTV)

LTV represents the total net profit you expect to earn from a customer throughout their entire relationship with your company. It is a critical metric for determining how much you can afford to spend on marketing (Customer Acquisition Cost or CAC).

Our calculator uses the standard SaaS LTV formula:

LTV = Average Monthly Revenue (ARPU) x Gross Margin % x (1 / Churn Rate)

Example Scenario

Let's look at a realistic example for a mid-market B2B SaaS company:

  • Beginning Customers: 500
  • Customers Lost: 10 (per month)
  • ARPU: $100
  • Gross Margin: 85%

In this case, the Churn Rate is 2% (10/500). The implied Customer Lifetime is 50 months (1 / 0.02). The LTV would be $4,250 ($100 x 0.85 x 50). This means the company can profitably spend up to $1,400 to acquire a customer while maintaining a healthy 3:1 LTV/CAC ratio.

Why Gross Margin Matters in LTV

Many basic calculators ignore Gross Margin, but for accurate financial planning, it is essential. Gross Margin accounts for the cost of serving the customer (hosting fees, support staff, third-party APIs). If your ARPU is $100 but it costs you $20 to provide the service, your LTV should be based on the $80 profit, not the $100 revenue.

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