Customer Churn Rate Calculator
Enter customers at the start of a period and customers lost to get your monthly and annual churn rate, retention rate, average customer lifetime and customer half-life. Already know the rate? Convert monthly churn to annual churn, or annual to monthly.
Lifetime and half-life assume the churn rate stays the same every month. Annual figures compound the monthly rate; they are not the monthly rate times 12.
Churn rate is the percentage of customers who cancel or stop paying during a set period. To calculate it, divide the customers lost in the period by the customers you had at the start, then multiply by 100. A business that starts a month with 500 customers and loses 15 has a 3% monthly churn rate.
Churn Rate Formula
The calculator above uses five formulas. Rates are written as decimals inside the formulas (3% = 0.03).
| Metric | Formula |
|---|---|
| Churn rate for a period | Customers lost ÷ customers at start × 100 |
| Monthly churn from a longer period | 1 − (1 − period churn)1 ÷ months |
| Annual churn from monthly churn | 1 − (1 − monthly churn)12 |
| Retention rate | 1 − churn rate |
| Average customer lifetime | 1 ÷ monthly churn (result in months) |
| Customer half-life | ln(0.5) ÷ ln(1 − monthly churn) |
| Revenue churn (gross) | MRR lost ÷ MRR at start × 100 |
How to Calculate Churn Rate: Worked Example
A subscription business starts the month with 500 customers and $50,000 of monthly recurring revenue (MRR). During the month 15 customers cancel, taking $3,000 of MRR with them. Press Load Example above to run these numbers; the calculator returns the results below.
| Metric | Working | Result |
|---|---|---|
| Monthly churn rate | 15 ÷ 500 × 100 | 3.00% |
| Monthly retention rate | 100% − 3% | 97.00% |
| Annual churn rate | 1 − 0.9712 | 30.6% |
| Average customer lifetime | 1 ÷ 0.03 | 33.3 months (2.8 years) |
| Customer half-life | ln(0.5) ÷ ln(0.97) | 22.8 months |
| Customers remaining | 500 − 15 | 485 |
| Monthly revenue churn | $3,000 ÷ $50,000 × 100 | 6.00% |
Revenue churn (6%) is double customer churn (3%) here, which means the customers who left were paying more than average. If the same business lost 120 of 1,000 customers over a quarter instead, the quarterly churn rate would be 12%, the monthly rate 4.17% and the annual rate 40.0%.
Monthly to Annual Churn Rate Conversion
Annual churn is not monthly churn times 12. Each month the rate applies to a smaller group of remaining customers, so the loss compounds: annual churn = 1 − (1 − monthly churn)12. Going the other way, monthly churn = 1 − (1 − annual churn)1/12, so 36% annual churn is 3.65% a month, not 3%.
| Monthly churn | Annual churn (compounded) | Wrong answer (× 12) | Average lifetime | Half-life |
|---|---|---|---|---|
| 1% | 11.4% | 12% | 100.0 months | 69.0 months |
| 2% | 21.5% | 24% | 50.0 months | 34.3 months |
| 3% | 30.6% | 36% | 33.3 months | 22.8 months |
| 5% | 46.0% | 60% | 20.0 months | 13.5 months |
| 7% | 58.1% | 84% | 14.3 months | 9.6 months |
| 10% | 71.8% | 120% | 10.0 months | 6.6 months |
To convert a rate you already know, choose “A churn rate I already know” in the calculator, enter the percentage and pick the period it covers.
Customer Churn vs Revenue Churn
Customer churn counts the accounts lost, whatever they paid. Revenue churn (also called MRR churn or gross dollar churn) measures the recurring revenue those accounts took with them. The two often differ because small accounts and large accounts do not leave at the same rate: a company can lose 5% of its customers but only 2% of its revenue if mostly small accounts leave. Net revenue churn subtracts expansion revenue from existing customers. When expansion is larger than the revenue lost, net churn is negative and the existing base grows without any new customers. This calculator reports gross revenue churn; use the net revenue retention calculator for the net figure.
How Churn Rate Limits Growth
Churn is a compounding drag. At 5% monthly churn, half of a group of customers is gone in 13.5 months (the customer half-life); at 2% it takes 34.3 months. Churn also sets a ceiling: with steady sales, recurring revenue stops growing when the revenue lost each month equals the revenue added, so maximum MRR = new MRR per month ÷ monthly revenue churn rate. Adding $10,000 of new MRR a month at 5% churn tops out at $200,000 MRR. Cut churn to 2% and the ceiling becomes $500,000 — the same sales effort, 2.5 times the outcome.
How to Use This Churn Rate Calculator
- Choose the period your numbers cover: a month, a quarter, six months or a year.
- Enter the customers you had on the first day and how many of those customers cancelled during the period. Leave new signups out of both numbers.
- Optionally add starting MRR and MRR lost to see revenue churn next to customer churn.
- Press Calculate. The monthly rate is shown first so periods of different lengths can be compared.
There is no single “good” churn rate: it depends on price, contract length, customer size and industry. Compare against your own earlier months first, then against a published benchmark for your sector such as Recurly’s churn rate benchmarks.
Reducing Churn
Start by finding out why customers leave, using exit surveys and usage data. Common causes are weak onboarding, low perceived value, unresolved support issues, pricing that does not match usage, and failed card payments (involuntary churn). Typical fixes are a faster path to first value for new customers, annual plans, retrying failed payments, and contacting accounts whose usage is falling before they cancel. Small changes matter: moving monthly churn from 5% to 4% lengthens average customer lifetime from 20 to 25 months.
Last updated: October 2026
Frequently Asked Questions
What is churn rate?
Churn rate is the percentage of customers who cancel or stop paying during a set period. Divide the customers lost in the period by the customers you had at the start of it, then multiply by 100. Losing 15 of 500 customers in a month is a 3% monthly churn rate.
How do you calculate churn rate?
Churn rate = (customers lost during the period / customers at the start of the period) x 100. Count only customers who were already there at the start. Do not subtract new signups from the losses and do not add them to the starting number, because churn measures loss from the existing base, separate from acquisition.
How do I convert monthly churn to annual churn?
Do not multiply by 12. Churn compounds, so annual churn = 1 - (1 - monthly churn)^12. A 3% monthly churn rate is 30.6% a year, not 36%, and 5% a month is 46.0% a year, not 60%. Multiplying by 12 overstates the loss because each month the rate applies to a smaller group of remaining customers.
How do I convert annual churn to monthly churn?
Do not divide by 12. Monthly churn = 1 - (1 - annual churn)^(1/12). For example, 36% annual churn equals 3.65% monthly churn, not 3.0%. In this calculator choose the known churn rate option, enter 36 and set the period to 12 months.
How is average customer lifetime calculated from churn?
Average customer lifetime = 1 / churn rate, in the same time unit as the rate. At 3% monthly churn the average customer stays 1 / 0.03 = 33.3 months, about 2.8 years. The formula assumes the churn rate stays constant, so treat it as an estimate. Real customers often churn faster in their first months.
What is customer half-life?
Customer half-life is the time it takes for half of a group of customers to churn. Half-life = ln(0.5) / ln(1 - monthly churn rate). At 5% monthly churn the half-life is 13.5 months. At 2% monthly churn it is 34.3 months. Half-life is always shorter than average customer lifetime.
What is the difference between customer churn and revenue churn?
Customer churn counts the accounts you lost. Revenue churn measures the recurring revenue those accounts took with them: MRR lost / MRR at the start of the period x 100. The two differ when the customers who leave pay more or less than average. Net revenue churn also subtracts expansion revenue from existing customers and can be negative.
What is a good churn rate?
There is no single good number. Churn depends on price, contract length, customer size and industry: low-priced monthly consumer subscriptions lose customers much faster than enterprise software on annual contracts. Compare your rate with your own past months first, then with a published benchmark for your own industry and price point.