How we worked it out
Updated as you change the numbers.
- MRR = customers × monthly revenue per customer. ARR = MRR × 12.
- Lifetime = 1 ÷ monthly churn. LTV = monthly revenue × gross margin ÷ monthly churn.
- LTV to CAC = LTV ÷ CAC.
Method and assumptions
The common subscription formulas: lifetime is one divided by the monthly churn rate, and lifetime value is monthly gross profit per customer multiplied by that lifetime.
Questions
What is LTV at $50 a month, 80% margin and 3% churn?
$1,333.33: $40 of monthly gross profit over an average lifetime of 33.3 months.
Sources
Method and figures checked on October 31, 2026. Every worked answer on this page is covered by an automated test. Found a mistake? Tell us.