Customer Lifetime Value Calculator
Calculate LTV from monthly revenue, gross margin, churn, and CAC. See lifetime months, payback period, and the LTV:CAC ratio.
Last updated: 2026-03-27
Customer lifetime value calculator
Enter your values
Pressure-test unit economics from ARPU, churn, gross margin, and CAC.
Estimated LTV
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Enter monthly revenue, gross margin, churn, and CAC to estimate customer lifetime value and payback.
Calculation History(0)
Example calculations
Tap an example to prefill the calculator with sample values.
Lean SaaS baseline
$120 ARPU, 80% margin, 4% monthly churn
A straightforward subscription model where churn and gross margin are the main drivers of lifetime value.
Result: A sub-4-month payback and an LTV:CAC comfortably above 3:1 usually signals room to scale more confidently.
Higher-ticket service
$450 revenue with lower margin but longer retention
Useful for agencies, coaching products, or B2B tools where revenue is stronger but margins are less software-like.
Result: Higher revenue can absorb a larger CAC, but the margin assumption still matters a lot.
Fast-churn ecommerce repeat buyer
$75 revenue, 55% margin, 9% churn
A retention-sensitive scenario where even modest churn improvements can change the economics materially.
Result: Retention pressure shortens lifetime fast, so LTV:CAC can look healthy or broken with only a few points of churn difference.
How customer lifetime value is estimated
The calculator first turns monthly revenue into gross profit by applying your gross-margin percentage. It then estimates customer lifetime as the inverse of monthly churn, which is a common shortcut for subscription and repeat-purchase planning.
Lifetime gross profit becomes LTV, and comparing that against CAC gives the LTV:CAC ratio. Payback period is the number of months of gross profit needed to recover the acquisition spend for a typical customer.
LTV FAQs
Use this for planning and comparison, then validate it against real retention and margin data.
Why does churn have such a large impact on LTV?
Because the model treats customer lifetime as the inverse of monthly churn. When churn rises, expected lifetime shrinks quickly, so the revenue and gross profit available to recover CAC collapse with it.
Why use gross margin instead of revenue alone?
Because high top-line revenue is not the same as usable value. Gross margin strips out direct service or fulfillment cost so the payback and LTV numbers reflect the profit stream that can actually recover acquisition cost.
What is a healthy LTV:CAC ratio?
Many SaaS and subscription teams use roughly 3:1 as a rough planning benchmark, but the right target depends on cash burn, payback tolerance, retention durability, and how much growth efficiency matters right now.
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</script> Related tools
Pair LTV assumptions with acquisition, churn, and margin tools.
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Business modeling note
This calculator uses a simplified inverse-churn model. Real customer value can differ when retention is non-linear, expansion revenue matters, or cohorts behave differently over time.