Customer Lifetime Value Calculator
Calculate customer lifetime value from ARPU, gross margin, and customer lifespan so you can estimate how much value one customer generates over time.
Position this page for SaaS, subscription, and ecommerce operators who need a practical way to estimate lifetime value from recurring revenue and margin assumptions.
Quick comparison
Review this metric alongside related calculators for a clearer picture of traffic cost, efficiency, profitability, or conversion performance.
Customer Lifetime Value Calculator
Enter your values below to calculate the result instantly.
Results
Example values are prefilled so you can see how the calculator works.
Quick read
The main number to watch here is customer lifetime value. Higher lifetime value usually means customers stay longer, spend more, or produce stronger margin.
Learn the metric behind the calculator
If you want more context, these guides explain how the metric works, how to interpret it, and how to compare it with related performance measures.
LTV:CAC ratio explained
↗Learn what the LTV:CAC ratio means, how to calculate it, and why it is more useful when paired with payback period and realistic lifetime value assumptions.
What is a good LTV:CAC ratio?
↗Learn how to judge LTV:CAC ratio in context, why a bigger ratio is not always enough, and how payback timing changes what healthy really looks like.
Churn vs retention explained
↗Learn the difference between churn and retention, how the two metrics work together, and why recurring-revenue businesses need both views at the same time.
How to measure app install efficiency
↗Learn how to measure app install efficiency with install rate, CPI, click cost, and post-install quality so you can judge mobile acquisition more intelligently.
What is a good CAC?
↗Learn how to judge customer acquisition cost in context, why CAC only makes sense relative to customer value, and what to compare it against.
Formula
Customer Lifetime Value = ARPU × Customer Lifespan × (Gross Margin / 100)
This calculator estimates lifetime value by multiplying average revenue per user by customer lifespan and adjusting the result by gross margin. That gives you a more useful economic view than revenue alone because it reflects contribution rather than only top-line sales.
How to use this calculator
- 1Enter average revenue per user for the time period you are modeling, usually monthly.
- 2Enter average customer lifespan in the same time unit.
- 3Enter gross margin as a percentage so the calculator can estimate value on a contribution basis.
What this metric tells you
Higher lifetime value usually means customers stay longer, spend more, or produce stronger margin.
This metric becomes much more useful when paired with CAC and payback period rather than being reviewed on its own.
Because it relies on assumptions, it is best treated as a planning estimate unless the underlying data is very stable.
Common use cases
- Estimating how much value a typical customer generates over time.
- Comparing unit economics across segments, plans, or channels.
- Pressure-testing whether acquisition cost is supportable relative to long-term customer value.
Related search topics
People looking for this tool often also search for closely related terms, formulas, and metric definitions.
Worked example
Example: calculating customer lifetime value
If ARPU is $120, average customer lifespan is 18 months, and gross margin is 75%, customer lifetime value is $1,620.00. That means a typical customer is expected to contribute about $1,620 in gross profit over the relationship.
FAQ
What is customer lifetime value?+
Customer lifetime value is the estimated economic value a customer generates over the full relationship with your business.
Why include gross margin in CLV?+
Margin makes the estimate more useful because it focuses on economic contribution rather than only top-line revenue.
Is CLV the same as LTV?+
In practice, the terms are often used interchangeably. The important part is being clear about the formula and assumptions behind the number.
Can CLV be overstated easily?+
Yes. CLV can become too optimistic when retention assumptions are weak, gross margin is ignored, or ARPU is inflated by a short high-performance window.
Important note
This calculator is provided for general informational and planning purposes only. Results are based on the values you enter and on simplified formulas.
Real-world performance can vary because of attribution settings, platform reporting differences, margins, refunds, conversion quality, channel mix, and other business factors.
Use calculator outputs as a quick decision aid, not as financial, legal, tax, accounting, or investment advice.
Related calculators
Explore closely related tools to compare traffic cost, efficiency, profitability, and conversion performance more clearly.
Average Revenue Per User Calculator
↗Calculate average revenue per user from total revenue and users so you can measure monetization efficiency across a customer or product base.
LTV:CAC Calculator
↗Calculate the LTV:CAC ratio from customer lifetime value and customer acquisition cost to check whether your growth model looks sustainable.
CAC Calculator
↗Calculate customer acquisition cost from marketing spend and new customers acquired so you can see what it really costs to add one customer.
Payback Period Calculator
↗Calculate payback period from CAC and monthly gross profit per customer to estimate how long it takes to recover acquisition cost.