Churn Rate Calculator
Customer churn, retention, and implied lifetime in one pass.
Customer churn rate for the period
Estimates for planning only, not financial advice.
Churn rate is the share of customers you lost in a period: customers lost divided by customers at the start. With 1,000 customers at quarter-start, 950 at quarter-end, and 80 new customers won, you lost 130, a 13% quarterly churn rate and an 87% retention rate. The implied average customer lifetime is about 7.7 quarters. This calculator derives churn, retention, customers lost, the annualized rate, and implied lifetime from three counts you already have.
How to Use This Calculator
Enter customers at the start and end of the period from your billing system, plus genuinely new customers won during it. Do not count reactivations or expansions as new unless your definition says so; consistency beats precision here. Select the period length for correct annualization. The results show churn and retention for the period, the annualized churn, and the implied average lifetime, which feeds directly into lifetime value math.
Pull start count, end count, and new customers from billing for the same period.
Select monthly, quarterly, or annual to annualize correctly. Never multiply monthly churn by 12.
Read churn, retention, and implied lifetime. Feed the lifetime into our CLTV calculator and the rate into our CAC calculator for the full unit-economics picture.
The Churn Formulas
The lost-customer derivation is the step people skip: end count alone mixes leavers and joiners, so you must add back the new customers to isolate the loss. Annualization compounds because each period\'s survivors face the next period\'s churn: 13% quarterly churn annualizes to 1 - 0.87^4 = 42.7%, not 52%. Implied lifetime of 1/0.13 = 7.7 quarters assumes churn stays constant, which it rarely does, so treat it as a planning input, not a promise.
Worked Example
A SaaS company starts Q3 with 1,000 customers, ends with 950, having won 80 new ones. Customers lost: 1,000 + 80 - 950 = 130. Quarterly churn: 130 / 1,000 = 13.0%. Retention: 87.0%. Annualized churn: 1 - (0.87)^4 = 42.7%. Implied lifetime: 1 / 0.13 = 7.7 quarters, about 23 months. At $150 monthly revenue and 75% margin, implied lifetime value is $112.50 x 23 = $2,588. If the company cuts quarterly churn to 8%, lifetime stretches to 12.5 quarters and LTV jumps to $4,219, a 63% increase from retention work alone.
Churn Benchmarks
| Segment | Typical annual churn | Notes |
|---|---|---|
| B2B SaaS, enterprise | 5 to 10% | Annual contracts, high switching costs |
| B2B SaaS, SMB | 15 to 25% | Monthly billing, budget sensitivity |
| B2C subscription | 20 to 40% | Low switching costs, impulse cancels |
| Mobile apps | 70%+ (30-day) | Most users never return after day 1 |
Benchmarks calibrate; cohorts diagnose. Split churn by acquisition cohort, plan tier, and tenure: first-90-day churn is an onboarding problem, while late-tenure churn is a value or competitive problem, and each needs different medicine. Watch net revenue retention alongside logo churn, because a business losing 15% of logos while growing revenue 20% from expansions is far healthier than the logo number suggests. For the economics built on these rates, our customer lifetime value calculator and CAC calculator complete the unit-economics loop.
Estimates for planning only, not financial advice.
Frequently Asked Questions
What is churn rate?
Churn rate is the percentage of customers lost over a period: (customers lost / customers at start) x 100. Start a quarter with 1,000 customers, end with 950 after adding 80 new ones, and you lost 130: a 13% quarterly churn rate. Its complement is the retention rate: 87% here. Churn is the single most important health metric for any subscription business.
How do you calculate churn rate?
Take customers at the start of the period, add new customers won, subtract customers at the end: that is customers lost. Divide by customers at the start. The formula needs all three counts because ending customers alone cannot distinguish lost customers from new ones. This calculator takes the three numbers and returns churn, retention, and the implied average customer lifetime.
What is a good churn rate?
For B2B SaaS, 5% to 7% annual churn is excellent and 10% is typical; for B2C subscriptions, 20% to 40% annual churn is common. Monthly churn of 2% to 3% sounds small but compounds to 22% to 31% annually. Compare against your segment and contract structure: annual contracts churn far less than monthly ones. The trend matters most: rising churn is an emergency whatever the level.
What is the difference between customer churn and revenue churn?
Customer churn counts logos lost; revenue churn measures dollars lost, usually as MRR. Losing 10 small customers hurts less than losing 2 enterprise ones, which revenue churn captures. Net revenue churn subtracts expansion revenue from lost revenue and can be negative (below zero), meaning the remaining customers grow faster than leavers shrink: the hallmark of top-performing SaaS. Track both.
How does churn affect customer lifetime value?
Directly and brutally. Average customer lifetime is roughly 1 / churn rate: 5% monthly churn implies a 20-month lifetime. Lifetime value is monthly gross profit times lifetime, so halving churn doubles LTV without acquiring a single new customer. This is why retention work usually beats acquisition work on ROI: it lifts the value of every customer you already paid to win.
What is gross vs net revenue retention?
Gross revenue retention measures revenue kept from existing customers excluding expansion: renewals only, capped at 100%. Net revenue retention includes upsells and cross-sells and can exceed 100%. Top-performing SaaS runs 120%+ net retention, meaning the customer base grows even with zero new sales. Investors prize net retention above almost any other metric because it proves the product spreads inside accounts.
Why do customers churn?
The top reasons are consistent across industries: the product did not deliver the promised outcome, onboarding failed and value was never realized, a champion left the customer company, pricing or packaging misfit, or a competitor won on features or price. Exit surveys and usage data usually point at one dominant cause. Fix onboarding first: most churn is decided in the first 30 to 90 days.
How can I reduce churn?
Instrument early-warning signals (login drops, support ticket spikes, champion turnover), intervene with at-risk accounts before renewal, fix the onboarding-to-value path, and align pricing with realized value. Annual contracts with a discount cut churn mechanically. The highest-impact move is usually a better first-90-days experience, because customers who reach the "aha moment" fast rarely leave.
How do you annualize monthly churn?
Do not multiply by 12; churn compounds. Annual churn = 1 - (1 - monthly churn)^12. A 2% monthly churn annualizes to 21.5%, not 24%. The monthly number always looks deceptively small, which is why teams reporting "only 2% churn" are often sitting on a leaky bucket. This calculator shows both the period rate and the annualized equivalent.
What is involuntary churn?
Churn from failed payments rather than customer choice: expired cards, insufficient funds, bank declines. It can be 20% to 40% of total churn in B2C subscriptions and it is the easiest churn to fix: card updaters, smart retries, and dunning emails recover most of it. Split churn into voluntary and involuntary before diagnosing, because they need completely different fixes.