Churn Rate Calculator
Customer churn, retention & average lifetime
Losing 25 of 500 customers in a month is 5% monthly churn, which compounds to 45.96% a year, not the 60% you get by multiplying by 12. Enter the customers you started with and lost to get churn, retention and average customer lifetime for your own period.
Reading your churn rate
The churn formula is the same whether you call this a customer churn calculator or a retention rate calculator: the two are complements of each other.
Churn rate is customers lost divided by customers at the start of the period. Retention is the rest. Losing 25 of 500 customers in a month is 5% monthly churn and 95% retention.
From a steady monthly rate, average customer lifetime is 1 ÷ churn, so 5% monthly churn implies a 20-month lifetime. That single number feeds directly into lifetime value, which is why churn is the most consequential metric a subscription business tracks.
Monthly churn does not multiply by 12
This is the mistake worth the whole page. Monthly churn compounds: each month you lose a percentage of whoever is left, not of the original cohort. Multiplying by 12 badly overstates annual losses, and above 8% monthly it produces figures over 100%, which is obviously nonsense.
Annual churn = 1 − (1 − monthly churn)12. Not monthly × 12.
| Monthly churn | Naive × 12 | Actual annual churn | Annual retention | Avg lifetime |
|---|---|---|---|---|
| 1% | 12% | 11.36% | 88.64% | 100 mo |
| 2% | 24% | 21.53% | 78.47% | 50 mo |
| 3% | 36% | 30.62% | 69.38% | 33.3 mo |
| 5% | 60% | 45.96% | 54.04% | 20 mo |
| 7% | 84% | 58.14% | 41.86% | 14.3 mo |
| 10% | 120% | 71.76% | 28.24% | 10 mo |
| 15% | 180% | 85.78% | 14.22% | 6.7 mo |
Going the other way is the twelfth root, not division: 20% annual churn is 1.84% monthly, not 1.67%. Set the period above and the calculator converts either direction.
| Annual churn | Equivalent monthly | Avg lifetime |
|---|---|---|
| 10% | 0.87% | 114.4 mo |
| 20% | 1.84% | 54.3 mo |
| 30% | 2.93% | 34.1 mo |
| 40% | 4.17% | 24.0 mo |
| 50% | 5.61% | 17.8 mo |
| 60% | 7.35% | 13.6 mo |
Customer churn against revenue churn
Counting customers and counting dollars give different answers, and the gap between them is diagnostic.
| Metric | Measures | Tells you |
|---|---|---|
| Customer churn | Accounts lost | Product and onboarding health |
| Gross revenue churn | MRR lost | Whether you lose big or small accounts |
| Net revenue churn | MRR lost minus expansion | Whether the base grows on its own |
If revenue churn is higher than customer churn you are losing your larger accounts, which is far more serious than the customer count suggests. If it is lower, you are losing small accounts and the damage is limited.
Net revenue churn can be negative, and that is the goal. When existing customers upgrade by more than departing ones take away, revenue grows without a single new customer. A business at negative net churn compounds on its own base, which is why investors weight it so heavily.
Both revenue measures need a monthly recurring revenue figure to work from. If you do not have one to hand, the MRR and ARR calculator builds it from paying customers and average revenue per account, which is the base every churn percentage on this page is applied to.
What counts as good
| Business | Good | Concerning |
|---|---|---|
| Enterprise SaaS | Under 1% | Over 2% |
| Mid-market B2B SaaS | 1 to 2% | Over 3% |
| SMB SaaS | 3 to 5% | Over 7% |
| Consumer subscription | 5 to 7% | Over 10% |
| Consumer mobile app | — | Often 10%+ and normal |
Comparing your number to a benchmark from a different segment is the most common way to reach a wrong conclusion here. SMB churn is structurally higher than enterprise churn because small businesses themselves fail; that is not a product problem.
Measurement traps
- Which denominator? Customers at the start of the period is the simplest and the one used here. Some teams use the average of start and end, which produces a lower number on a growing base. Pick one and never switch.
- New customers acquired mid-period distort the figure if included in the denominator. Cohort analysis avoids this entirely and is worth the effort once you have the data.
- Annual contracts hide churn until renewal, so monthly churn on an annual-billed base is close to meaningless. Measure at the renewal point.
- Voluntary and involuntary churn are different problems. Failed cards and expired payment details are often 20 to 40% of all churn, and dunning emails fix that far more cheaply than product work.
- Pauses and downgrades are neither retention nor churn. Decide how you treat them and document it.
The involuntary churn point is the most actionable thing on this page. Recovering failed payments is usually the cheapest retention work available to a subscription business, and it needs no product changes at all.
What the churn rate assumes
Churn is customers lost ÷ customers at the start of the period. Retention is 100% minus that. Average lifetime is 1 ÷ churn rate in periods.
- Period conversion compounds. Monthly to annual is 1 − (1 − m)¹², and annual to monthly is the twelfth root. Multiplying or dividing by 12 is wrong in both directions and increasingly so at higher rates.
- Start-of-period denominator. Customers acquired during the period are excluded, which is the simplest convention. Teams using the average of start and end will get a lower figure on a growing base; consistency matters more than the choice.
- Customer churn only. Revenue churn and net revenue churn need MRR data and are described in the guide rather than calculated.
- Steady-rate assumption for the lifetime figure. Real churn is front-loaded, with most cancellations in the first weeks, so a cohort analysis gives a truer lifetime than 1 ÷ churn.
- Benchmarks are industry rules of thumb as of September 2026 and vary widely by segment, contract length and pricing model.
Reviewed September 2026.
Figures reviewed . Every worked example on this page is checked against the calculator above.
Churn Rate Calculator: frequently asked questions
How do I calculate churn rate?
Divide the customers you lost during the period by the number you had at the start, then multiply by 100. Losing 25 out of 500 is 5% churn, and 95% retention.
How do I convert monthly churn to annual?
Annual churn = 1 − (1 − monthly)^12, not monthly × 12. Churn compounds because each month you lose a share of whoever is left. 5% monthly is 45.96% annual, not 60%.
Why isn't monthly churn times 12 the annual rate?
Because each month's loss applies to the survivors, not the original cohort. Multiplying overstates it, and above 8% monthly it gives figures over 100%, which is impossible.
How do I convert annual churn to monthly?
Take the twelfth root: monthly = 1 − (1 − annual)^(1/12). 20% annual churn is 1.84% monthly, not 1.67%. Set the period above and the calculator does it either way.
How does churn relate to customer lifetime?
Average lifetime is 1 ÷ churn for a steady rate. 5% monthly churn implies a 20-month lifetime, 2% implies 50 months. That figure feeds straight into lifetime value.
What is a good churn rate?
Under 1% monthly for enterprise SaaS, 1 to 2% for mid-market, 3 to 5% for SMB, and 5 to 7% for consumer subscriptions. Comparing across segments is misleading, since SMB churn is structurally higher.
What is the difference between customer churn and revenue churn?
Customer churn counts accounts lost; revenue churn counts the MRR they took with them. If revenue churn is higher, you are losing your larger accounts, which is more serious than the headcount suggests.
What is negative net churn?
When expansion revenue from existing customers exceeds the revenue lost to cancellations, so the customer base grows in value with no new customers at all. It is the strongest signal in subscription economics.