LTV Calculator
Customer Lifetime Value — how much each customer is worth
Free LTV calculator. Compute Customer Lifetime Value using churn-based formula. See LTV:CAC ratio and payback period. Works for SaaS, D2C, subscription businesses.
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What is a LTV Calculator?
Customer Lifetime Value (LTV or CLV) is the total gross profit a business expects to generate from a single customer over their entire relationship with the company. It is the other half of the CAC equation — without LTV, you cannot judge whether your customer acquisition cost is sustainable.
The most robust formula for subscription and recurring-revenue businesses is LTV = ARPU × Gross Margin × (1 / Monthly Churn Rate). The "1 / churn" term gives you the expected average customer lifetime in months. A business with 5% monthly churn retains customers for an average of 20 months; at 2% churn, that extends to 50 months — LTV nearly triples.
Improving LTV has a compounding effect. Because LTV determines how much you can rationally spend on acquisition (LTV:CAC ≥ 3× is the benchmark), even a 1% churn reduction can unlock significantly higher ad budgets, which drives faster growth. This makes retention work — onboarding quality, product stickiness, customer success — the highest-ROI investment for most subscription businesses.
Why use this LTV Calculator
Built for Indians, by Indians. Every number, every formula, every slab — tuned to FY 2026-27 reality.
Churn-based lifetime
Uses 1/churn formula for statistically correct average customer lifetime, not a fixed horizon.
LTV:CAC ratio
Enter your CAC to instantly see the ratio and payback period alongside LTV.
Churn sensitivity
The tip shows LTV at churn − 1% to illustrate the compounding impact of retention improvement.
100% private
All calculations run in-browser. No data stored.
Using the LTV Calculator in 4 steps
No onboarding, no signup. Answer three fields and the numbers update live.
Enter ARPU
Average monthly revenue per customer. Use net revenue (after discounts), not gross billings.
Set gross margin
Revenue minus COGS as a percentage. SaaS: typically 70–85%. D2C: 25–50%. Services: 50–70%.
Enter monthly churn rate
Percentage of customers who cancel or lapse each month. Annual churn ÷ 12 gives a rough monthly rate. Measure cohort churn, not just total customer count.
Enter CAC
Your customer acquisition cost from the CAC calculator or internal data. LTV:CAC and payback period update instantly.
Tips to get the most out of it
Use cohort churn, not headline churn. If you added 1,000 new customers last month, your total churn rate looks low — but the underlying retention may be poor. Track churn within a cohort of same-month acquires.
LTV in this calculator is a contribution-margin LTV. It does not deduct S&M, overhead, or tech costs. Actual economic LTV is lower — factor in these costs before using LTV to set CAC targets.
For D2C and non-subscription businesses, estimate purchase frequency and average order value instead: LTV = AOV × Purchase Frequency × Lifespan × Gross Margin.
Distinguish between logo churn (customer count) and revenue churn (MRR). Negative net revenue churn (expansions > churned MRR) is possible and dramatically raises LTV.
Improving onboarding in the first 30 days typically has the highest impact on churn — most customers who leave do so within the first 60 days.
Real-world scenarios
How Indians actually use this calculator — concrete inputs, concrete outcomes.
HR SaaS product
ARPU ₹5,000/mo, 75% margin, 3% monthly churn → LTV ₹1,25,000. At CAC ₹30,000 → LTV:CAC 4.2×. Payback 8 months. Healthy unit economics.
D2C subscription box
ARPU ₹1,200/mo, 35% margin, 8% churn → LTV ₹5,250. At CAC ₹2,000 → LTV:CAC 2.6×. Payback 4.8 months. Tight — focus on reducing churn to 5%.
Online course platform
ARPU ₹3,000/mo, 65% margin, 2% churn → LTV ₹97,500. At CAC ₹15,000 → LTV:CAC 6.5×. Excellent. Room to double CAC target and grow faster.
Frequently Asked Questions
Still have a question? Our team replies within a business day.
There is no universal good LTV — it must be evaluated relative to CAC. The benchmark is LTV:CAC ≥ 3×. Focus on growing LTV faster than CAC, rather than hitting any absolute LTV number.
LTV is gross-margin-adjusted lifetime revenue from one customer. Revenue per customer over their lifetime counts all product cost. LTV strips out COGS to show the value the business captures, not just the value that flows through it.
Best-in-class SaaS: < 1% monthly (< 12% annual). Good: 2–3%. Concerning: > 5% monthly. D2C and consumer: 5–10% is common. The lower the churn, the longer the average lifetime and higher the LTV.
Yes, if the customer's contribution margin is negative — meaning you are selling below your own marginal cost. This signals either pricing or COGS problems, not just acquisition problems.
Yes — Customer Lifetime Value and Customer LTV are used interchangeably. Some models call it CLV to distinguish from the LTV:CAC ratio shorthand. Same formula, same concept.
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