Subscription Customer Lifetime Value CalculatorFree online financial calculator — instant results, no sign-up
Estimate gross-profit lifetime value under constant monthly revenue and churn.
Estimates only, based on the inputs and assumptions shown. This is not financial, investment, tax, or legal advice. Prices, rates and local rules may change; crypto scenarios do not predict returns. Confirm important decisions with a qualified professional.
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About the Subscription Customer Lifetime Value Calculator
The Subscription Customer Lifetime Value Calculator estimates how much gross profit a subscription customer generates over their expected lifetime using monthly revenue, gross margin, and monthly customer churn. It assumes revenue and margin stay constant and customers have the same probability of churning each month. With the default inputs of $80 monthly revenue, 75% gross margin, and 3% monthly churn, it estimates a lifetime of 33.3333 months and gross-profit lifetime value of $2,000.00.
- Monthly revenue per customer ($)
- Average subscription revenue earned per customer each month, measured in dollars, with a default of $80.
- Gross margin (%)
- The percentage of revenue remaining after direct costs of providing the subscription service, with a default of 75%.
- Monthly customer churn (%)
- The percentage of customers present at the start of a month who leave during that month, with a default of 3%.
Formula and method
m = G / 100; c = C / 100; L = 1 / c; V = R × m × L = (R × m) / c. With the defaults: L = 1 / 0.03 = 33.3333 months (rounded); V = ($80 × 0.75) / 0.03 = $2,000.00.
- RMonthly revenue per customer in dollars.
- GGross margin entered as a percentage.
- CMonthly customer churn entered as a percentage.
- mGross margin expressed as a decimal.
- cMonthly customer churn expressed as a decimal.
- LExpected customer lifetime in months.
- VGross-profit lifetime value per customer in dollars.
Convert gross margin and monthly churn from percentages to decimals. Divide 1 by the monthly churn decimal to estimate expected lifetime in months. Multiply monthly revenue by the gross margin decimal to obtain monthly gross profit per customer, then divide that amount by the monthly churn decimal. Keep full precision during calculation and round only the displayed outputs.
Worked example
These are the calculator's starting values and the results it actually produces for them.
Inputs
- Monthly revenue per customer80 $
- Gross margin75 %
- Monthly customer churn3 %
Results
- Expected customer lifetime33.3333
- Gross-profit lifetime value$2,000.00
How to use the Subscription Customer Lifetime Value Calculator
- 1Enter monthly revenue per customer in dollars; the default is $80.
- 2Enter gross margin as a percentage; the default is 75%.
- 3Enter monthly customer churn as a percentage, not annual churn or revenue churn; the default is 3%.
- 4Calculate expected lifetime as 1 / 0.03, giving 33.3333 months when rounded.
- 5Review gross-profit lifetime value: $80 × 0.75 / 0.03 gives $2,000.00 per customer.
Reading your result
The Expected customer lifetime row estimates the average number of months a customer remains subscribed under constant monthly churn; 33.3333 months is an average, not a predicted cancellation date for any individual. The Gross-profit lifetime value row estimates total gross profit per customer over that lifetime; $2,000.00 is after the direct costs represented by gross margin, but before customer acquisition costs, overhead, taxes, and other costs outside gross margin.
Limitations
This is an undiscounted, constant-churn model with expected lifetime defined as 1 divided by monthly churn. It assumes stable monthly revenue and gross margin, a constant independent probability of cancellation each month, and recurring monthly contribution while a customer remains active. It does not model expansion revenue, changing prices, reactivations, cohort differences, or changes in retention over time. Customer churn must be greater than 0% and no more than 100% for a finite, meaningful lifetime estimate; 0% churn produces no finite lifetime under this model. Small errors in low churn estimates can cause large changes in lifetime value.
Common questions
Why does 3% monthly churn imply a lifetime of 33.3333 months?+
The calculator uses the reciprocal of monthly churn: 1 / 0.03 = 33.3333 months when rounded. This represents the expected number of monthly subscription periods under a constant-churn model, not a guaranteed customer lifespan.
Why is the default gross-profit lifetime value $2,000.00?+
At $80 in monthly revenue and 75% gross margin, monthly gross profit is $60 per customer. Dividing $60 by 0.03 monthly churn gives $2,000.00 without using the rounded lifetime in the calculation.
Can I enter revenue churn or annual churn instead of monthly customer churn?+
No. This formula requires the monthly proportion of customers lost. Revenue churn can reflect upgrades and downgrades rather than customer departures, and annual churn must first be converted to a consistent monthly customer churn rate.
Is this lifetime value the amount I can safely spend to acquire a customer?+
Not by itself. The $2,000.00 default result is estimated lifetime gross profit, not a recommended acquisition budget. Acquisition spending must also leave room for overhead, financing needs, uncertainty, and your target profit, while considering how long it takes to recover that spending.
Does the calculator save my information?+
Calculations run in your browser. While signed in, inputs and results are automatically recorded in account history; saving a result creates a separate saved record.
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Results are estimates for informational purposes and are not financial, medical or legal advice.