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Business & Accounting

Customer Lifetime Value (CLV) Calculator

Estimate customer lifetime value (CLV/LTV) from average revenue, gross margin and churn, with an optional discount rate.

Your inputs

Results

Customer lifetime value

$1,000.00

Discounted CLV
$1,000.00
Average customer lifetime
25 months
Gross margin per customer per month
$40.00

≈Estimate based on the stated model and assumptions

What this calculator does

CLV estimates the gross profit a customer generates over their relationship with you. For subscriptions, churn determines the expected lifetime.

Formula and method

Monthly margin m = ARPU × gross margin; CLV = m ÷ churn; Discounted CLV = m × (1 + d) ÷ (d + churn)

Worked example

Calculated by this tool with its default inputs:

Inputs

  • Average revenue per customer per month: 50 (any currency)
  • Gross margin: 80 %
  • Monthly churn rate: 4 %
  • Monthly discount rate (optional): 0 %

Results

  • Customer lifetime value: 1,000
  • Discounted CLV: 1,000
  • Average customer lifetime: 25 months
  • Gross margin per customer per month: 40

How to read the results

Average lifetime is 1 ÷ churn; a 4 % monthly churn implies about 25 months.

Assumptions and limitations

  • Assumes constant churn and revenue per customer.

Financial results are estimates based on the inputs and assumptions shown. They are not financial advice; confirm figures with your lender, provider or a qualified adviser before making decisions.

Questions

Why discount CLV?

Future profit is worth less than profit today; discounting matters for long lifetimes.

Methodology and verification

Result type
Estimate based on the stated model and assumptions
Formula version
1.0
Automated verification
3 reference and validation test cases, checked against independently computed values. The site cannot be built if any of them fail.
Editorial review
Awaiting human editorial review. The explanation was drafted with AI assistance; the formula and examples are verified by the automated tests above.

Privacy

Everything you enter is calculated in this browser and is not sent to Numerith or anyone else. Inputs are added to a share link only if you choose to include them. Privacy policy