LTV Calculator

How This Calculator Works

Use this ltv tool for quick estimation, comparison, and planning intent while keeping formula assumptions visible.

Use the LTV calculator to estimate customer lifetime value from average revenue per account, gross margin, and monthly churn rate.

A simple subscription LTV estimate multiplies gross profit per month by expected customer lifetime.

Example Calculation

$49 ARPU, 75% gross margin, and 4% churn gives an LTV of about $919.

When to Use This Calculator

• Compare CAC and LTV
• Estimate payback room
• Model churn impact

Practical Scenarios

• Use the LTV Calculator to compare cac and ltv while comparing at least one conservative and one higher-cost scenario.
• Use the LTV Calculator to estimate payback room while comparing at least one conservative and one higher-cost scenario.
• Use the LTV Calculator to model churn impact while comparing at least one conservative and one higher-cost scenario.

Tips

• Use gross margin, not revenue alone
• Churn estimates should match customer segment
• Low churn has a large effect on LTV

Common Mistakes

• Ignoring gross margin
• Using annual churn in a monthly formula
• Averaging very different customer segments
• Using a best-case input when a realistic range would be safer.
• Forgetting fees, taxes, inflation, usage changes, or other hidden costs where they apply.

Assumptions and Limitations

The LTV Calculator is most accurate when the inputs match current real-world numbers and when you review the formula, assumptions, and related calculators before acting.

• Refunds, chargebacks, taxes, payment fees, labor, seasonality, and contracts can change real outcomes.
• The result is a planning estimate, not accounting, tax, legal, or professional advice.
• Verify assumptions against current records before changing prices, budgets, or strategy.

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