Use this calculator to estimate customer lifetime value calculator from your own assumptions. The calculation runs locally in your browser, and the formula, example, scope, and source are visible below.
How to use this calculator
- ARPU / average revenue per customer per period: enter the value for the same scenario and period as the other inputs.
- Gross margin %: enter the value for the same scenario and period as the other inputs.
- Average customer lifespan in periods OR churn rate %: enter the value for the same scenario and period as the other inputs.
- Calculation mode (explicit lifespan / churn-derived): enter the value for the same scenario and period as the other inputs.
- Replace the example values with values from one consistent scenario.
- Select Calculate and review the primary and supporting results.
- Change one assumption at a time when comparing scenarios, then verify material decisions against the governing source or a qualified professional.
Formula and method
Explicit lifespan: LTV = ARPU * gross_margin_pct * lifespan
Churn-derived: lifespan ≈ 1 / churn_rate_decimal
LTV = ARPU * gross_margin_pct / churn_rate_decimal
The implementation uses the audited A5 — Customer Economics method. Intermediate values retain calculation precision; the interface formats values only for display unless the formula itself specifies a rounding rule.
Worked example
Inputs: ARPU=$100/month; Gross margin=80%; Monthly churn=5%
Result: Implied lifespan≈20.00 months; Gross-profit LTV=$1,600.00
This is the baseline audited scenario used to check that the page, formula, and displayed result remain aligned.
How to interpret the result
The calculator reports Gross-profit LTV; revenue LTV (secondary); implied lifespan. Treat the output as a scenario estimate: it changes when the entered scope, time period, fee basis, or cost definition changes. It does not establish a universal benchmark or guarantee a business outcome.
Assumptions and limitations
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Offer multiple transparent methods. The explicit-lifespan method is a simple CLV model. The churn-derived lifespan ≈1/churn and gross-profit LTV = ARPU×gross margin/churn assume approximately constant churn, stable ARPU and stable gross margin.
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label these assumptions clearly.
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Results are informational planning estimates, not accounting, tax, legal, employment, valuation, or investment advice.
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Values are processed in the browser and are not submitted to an application server.
Common mistakes
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Churn=0.
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churn>100%.
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use cohort retention for non-constant churn.
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Offer multiple transparent methods. The explicit-lifespan method is a simple CLV model. The churn-derived lifespan ≈1/churn and gross-profit LTV = ARPU×gross margin/churn assume approximately constant churn, stable ARPU and stable gross margin.
-
label these assumptions clearly.
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Rounding intermediate values before completing the formula can change the final result.
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A worked example is not a default recommendation; replace every assumption that does not match your case.
Frequently asked questions
What is the formula for Customer Lifetime Value?
The calculation applies this audited method: Explicit lifespan: LTV = ARPU * gross_margin_pct * lifespan Churn-derived: lifespan ≈ 1 / churn_rate_decimal LTV = ARPU * gross_margin_pct / churn_rate_decimal Display rounding is applied after the calculation rather than to intermediate values unless the rule explicitly requires it.
What inputs do I need for the Customer Lifetime Value Calculator?
Use the same period and units for these inputs: ARPU / average revenue per customer per period; Gross margin %; Average customer lifespan in periods OR churn rate %; Calculation mode (explicit lifespan / churn-derived). Keep optional assumptions at their example values only when those values match your scenario.
How should I interpret the result?
Read Gross-profit LTV; revenue LTV (secondary); implied lifespan as a planning estimate for the assumptions entered. Compare scenarios using the same scope and period; the calculator does not establish a universal target or guarantee an outcome.
What are the most common mistakes in this calculation?
For customer lifetime value calculator, keep the input definitions consistent and review these boundary conditions: Churn=0; churn>100%; use cohort retention for non-constant churn.
How this calculator was created and tested
- Formula basis: the public formula is generated from the audited implementation specification for this calculator, not inferred from a search snippet or an AI answer.
- Validation coverage: 2 of 2 release test vectors are marked Audited for this calculator. The suite covers a normal scenario plus boundary or invalid-input behavior where defined.
- Regression behavior: build checks compare expected outputs, validation states, route integrity, structured data, internal links, and release blockers before publication.
- Automation and AI: automation or AI may assist drafting, organization, and regression work, but it is not treated as an authoritative source and does not override the audited formula, official rate registry, or release blockers.
- Editorial responsibility: MIASIN S.R.O. controls publication, source policy, corrections, and release decisions. No named individual expert review is claimed unless a page explicitly identifies one.
Read the full Methodology, Editorial Standards, and Corrections Policy.
Sources and freshness
Sources are ordered by authority: government or official sources first, then first-party platform sources, educational references, and finally supporting industry references.
Last reviewed: September 22, 2026
Source set reviewed: September 22, 2026
Next scheduled review: September 22, 2027
Review cadence: Annual or when metric definitions change