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Churn Rate Calculator Guide
Churn is the share of customers who leave in a period. It's the quietest killer in subscription businesses, because you can be adding customers fast and still shrinking.
Churn rate = (Customers lost ÷ Customers at start) × 100
Lose 45 of 900 customers and your churn is 5%. Retention is whatever's left — 95%.
Small Numbers, Huge Consequences
5% monthly churn sounds survivable. It isn't, once you compound it. Losing 5% a month means keeping roughly 54% of a cohort after a year — you replace half your customer base annually just to stand still.
Drop to 2% monthly and about 78% survive the year. That gap is the difference between a business that compounds and one that runs on a treadmill.
Churn and Lifetime Are the Same Fact
Average customer lifetime = 1 ÷ churn rate. At 5% monthly churn the average customer stays 20 months. At 3%, they stay 33.
That's why churn reduction is the highest-leverage work in most subscription businesses. Cutting churn from 5% to 3% raises lifetime value by two-thirds without winning a single new customer — and it makes every acquisition channel more affordable at the same time. See our LTV calculator.
Customer Churn vs Revenue Churn
These can point in opposite directions, and the difference matters.
Customer churn counts people. Revenue churn counts money. Lose ten tiny accounts and one enormous one, and your customer churn looks mild while your revenue churn is severe.
Some businesses even manage negative revenue churn — existing customers upgrade enough to more than replace the revenue lost to leavers. That's the strongest signal in SaaS, and it's invisible if you only track customer churn.
Voluntary vs Involuntary
Not all churn is a rejection. A meaningful share is involuntary — expired cards, failed payments. It's often the cheapest churn to fix, because those customers wanted to stay. Dunning emails and card-update prompts recover a real percentage for almost no effort.
Watch the Denominator
If you grew fast during the period, using the starting count understates churn, because customers who joined and left within the period aren't in the denominator. For fast-growing businesses, cohort analysis beats a single blended rate every time.
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