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Churn rate calculator

Customer churn rate is the customers you lost in a period divided by the customers you started it with — 14 of 400 is 3.5% a month. Enter your customer and MRR movements to get customer churn, annualized churn, revenue churn, GRR and NRR.

Updated

Customers this month

Only from the starting group.

Revenue this month
$
$

Lost to cancellations.

$

Lost to downgrades.

$

Gained from upgrades by existing customers (not new ones).

Monthly customer churn

3.5%

Compounds to about 34.8% a year; the average customer stays 28.6 months.

Gross revenue churn(churned + contraction) ÷ start MRR
5%
Net revenue churnNegative = expansion outgrew losses
−1%
Gross revenue retention (GRR)
95%
Net revenue retention (NRR)Monthly — the same cohort’s revenue a month later
101%

NRR at or above 100%: existing customers grow revenue faster than churn removes it.

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What is churn rate?

Churn rate is the share of customers — or of recurring revenue — you lose over a period, usually a month. It’s the leak in the bucket: every customer who leaves has to be replaced before you can grow, and it sets the ceiling on customer lifetime value.

There are two kinds, and they often tell different stories. Customer (logo) churn counts accounts. Revenue churn counts dollars, so losing ten $9 accounts and losing one $900 account look very different. Net revenue retention goes one step further and credits the upgrades your remaining customers make.

Churn rate formulas

Customer churn = Customers lost ÷ Customers at startAnnualized churn = 1 − (1 − monthly churn)¹²Average lifetime = 1 ÷ monthly customer churnGross revenue churn = (Churned MRR + Contraction MRR) ÷ Starting MRRNet revenue churn = (Churned + Contraction − Expansion MRR) ÷ Starting MRRGRR = 1 − gross revenue churn NRR = 1 − net revenue churn
All MRR movements are from customers who existed at the start of the month. New customers’ MRR is excluded.

Worked example

  1. A SaaS starts the month with 400 customers and $20,000 MRR. During the month 14 of those customers cancel.
  2. Customer churn = 14 ÷ 400 = 3.5%. Annualized: 1 − 0.965¹² ≈ 34.8%. Average lifetime: 1 ÷ 0.035 ≈ 28.6 months.
  3. The 14 cancellations were worth $700 MRR, and other customers downgraded by $300: gross revenue churn = ($700 + $300) ÷ $20,000 = 5.0%, so GRR is 95%.
  4. Existing customers also upgraded by $1,200: net revenue churn = ($700 + $300 − $1,200) ÷ $20,000 = −1.0%, so NRR is 101%.

Negative net revenue churn is the best position a subscription business can be in: even with zero new customers, revenue from this cohort would still grow. Note how customer churn (3.5%) and revenue churn (5%) differ here — the customers who left were slightly larger than average.

What is a good churn rate? Benchmarks

Churn depends heavily on who you sell to and at what price, so treat benchmarks as ranges rather than targets. Most published retention benchmarks are annual; to compare a monthly figure, compound it (a 95% monthly GRR is about 0.95¹² ≈ 54% a year for the same cohort).

BenchmarkFigureSource
Gross revenue retention (annual), by ARR rangeRelatively consistent at 85–90%Bessemer, “Scaling to $100 Million”, 2021
Gross retention of SMB-focused companies70–80% can still work (HubSpot in its 3 years pre-IPO)Bessemer, 2021
Net retention (annual), average140% at $1–10M ARR, about 120% at $10–100M+Bessemer, 2021
Share of SaaS with NRR above 100%2.7% when ARPA < $10/month vs 41.1% when ARPA > $500/monthChartMogul SaaS Retention Report, 2023
Bessemer’s figures describe venture-backed cloud companies; small self-serve products typically churn more.

Common churn calculation mistakes

  • Including new customers. If you add this month’s signups to the denominator, or count their cancellations in the numerator, churn swings with acquisition. Use the starting cohort only.
  • Multiplying by 12. 3.5% × 12 = 42% overstates annual churn; compounding gives 34.8%.
  • Counting downgrades as churn. A downgrade is contraction — it belongs in revenue churn, not customer churn.
  • Ignoring failed payments. Involuntary churn (expired cards, failed renewals) is often a large share of churn and the easiest to recover with retries and reminders.
  • Measuring annual-plan customers monthly. Annual customers can only churn at renewal; mixing them with monthly customers in one monthly rate understates risk until renewals bunch up.
  • Using a single month. Churn is noisy for small customer bases — average three to six months before acting on it.

How VisitTrack helps you reduce churn at the source

Churn itself is measured in your billing tool. Where VisitTrack helps is upstream: customers from some channels churn far more than others, and you can only see that if you know where each customer came from.

  1. Attribute every payment to its source with revenue attribution — refunds are tracked too, so a channel with high early refunds stands out on the Revenue tab.
  2. Identify signed-in users (People and identify) to see the first-touch source and activity of each customer in the People view.
  3. Use the Retention tab to see what share of each weekly visitor cohort is active again around day 1, 7, 14 and 30 — a leading indicator of engagement before anyone cancels.
  4. Track the actions that predict retention (project created, teammate invited) as custom events, and build a funnel to see where new users stall.

Frequently asked questions

How do you calculate churn rate?

Divide the customers lost during a period by the customers you had at the start of it. If you start the month with 400 customers and 14 cancel, monthly churn is 14 ÷ 400 = 3.5%. Don’t include customers acquired during the month.

How do you convert monthly churn to annual churn?

Use 1 − (1 − monthly churn)^12, not monthly churn × 12. A 3.5% monthly churn rate is 1 − 0.965^12 ≈ 34.8% a year; multiplying by 12 would wrongly give 42%.

What is the difference between customer churn and revenue churn?

Customer churn counts accounts lost; revenue churn counts the recurring revenue lost, including downgrades. They diverge when the customers who leave pay more or less than average — losing one large account can mean low customer churn and high revenue churn.

How do you calculate net revenue retention (NRR)?

Take starting MRR, add expansion from existing customers, subtract contraction and churned MRR, and divide by starting MRR. ($20,000 + $1,200 − $300 − $700) ÷ $20,000 = 101%. Revenue from new customers is excluded.

What is a good churn rate for SaaS?

It depends on your market: businesses selling to larger companies at higher prices churn far less than low-priced self-serve products. Bessemer reports annual gross revenue retention of 85–90% across ARR ranges for venture-backed cloud companies, and notes SMB-focused businesses can work at 70–80%.

What is negative churn?

Negative net revenue churn means expansion revenue from existing customers is larger than what you lose to cancellations and downgrades, so NRR is above 100%. The existing customer base grows revenue even with no new customers.

Should I count failed payments as churn?

Yes, once they aren’t recovered — that’s involuntary churn. Track it separately from voluntary cancellations, because payment retries and card-update reminders can win much of it back.

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