Free tool

Churn Rate Calculator

See your churn rate, what it implies for customer lifetime, and how it compounds over a year.

How fast customers leave and what that does to average lifetime. Small churn improvements move lifetime value more than price changes do.

Customers at start of month
Customers lost

Calculate churn

Example

Customers at start of month 1,000 · Customers lost 30

3.0%

Monthly churn rate

Signal Healthy

How it works

1
Enter your numbers

Fill in customers at start of month and customers lost. Change a number and the answer updates.
2
Press calculate churn

One button. Change any input afterwards and the answer updates as you type.
3
Read the result

You get monthly churn rate, plus retention rate, average lifetime, annualised churn.

How churn rate is calculated

Churn rate is customers lost during a period divided by customers you had at the start of it. Begin the month with 1,000 customers and lose 30, and your monthly churn is 3%.

Exclude customers acquired during the period from the denominator. Including them makes churn look lower simply because you grew, which is exactly when you most need an accurate number.

Churn and customer lifetime are the same number

Average customer lifetime is the reciprocal of churn. At 3% monthly churn the average customer stays about 33 months. At 8% they stay 12 months. That relationship is why small churn improvements move lifetime value so sharply — cutting churn from 5% to 3% takes the average customer from 20 months to 33, a 65% increase in lifetime value with no change to price or acquisition.

Why annual churn is not monthly churn times twelve

Churn compounds. Each month it applies to the customers who remain, not the number you started the year with. 3% monthly churn is not 36% annually — it is about 31%, because the base shrinks each time.

The difference grows with the rate. At 8% monthly, naive multiplication suggests 96% annual churn, while the compounded figure is roughly 63%. Still bad, but a very different business.

Logo churn vs revenue churn

This calculator measures logo churn: customers lost. Revenue churn weights each departure by what they paid, and the two can diverge dramatically. Losing ten small accounts and keeping one large one may be fine; losing the large one and keeping the ten is not, even though logo churn is far better.

Companies with strong expansion revenue often report negative net revenue churn — existing customers grow faster than departing ones shrink the base — while logo churn stays firmly positive. Both numbers are real and they answer different questions.

What this does not do

This is logo churn — customers lost. Revenue churn weights each departure by what it paid, and the two can point in opposite directions.
Small customer counts make the rate noisy. Losing two customers out of thirty is a 6.7% month that may say nothing about the trend.
A single period hides seasonality and cohort effects. Look at several months before drawing a conclusion.

Frequently asked questions

How do you calculate churn rate?

Divide customers lost during the period by the number of customers at the start of that period. Starting with 1,000 and losing 30 gives 3% monthly churn.

What is a good churn rate for SaaS?

For SMB SaaS, 3% or less per month is generally healthy and 5%+ is a problem. Enterprise SaaS should be well under 1% monthly. Consumer products tolerate considerably higher churn.

Is annual churn just monthly churn times twelve?

No. Churn compounds against a shrinking base, so 3% monthly is roughly 31% annually rather than 36%. The gap widens as the rate rises.

Should new customers count in the churn calculation?

No. Use only the customers you started the period with as the denominator. Including new signups understates churn precisely when growth is fastest.

What is the difference between logo churn and revenue churn?

Logo churn counts customers lost; revenue churn weights each loss by the revenue it carried. A company can have healthy logo churn and terrible revenue churn if the accounts leaving are the large ones.