Customer Churn Rate Calculator
Measure the percentage of customers who stopped using your service during a period. Essential for subscription businesses monitoring retention health and forecasting future revenue.
About this calculator
Churn rate quantifies how quickly a business is losing its customer base, expressed as a percentage of the starting customer count. The formula is: Churn Rate (%) = (customersLost / totalCustomers) × 100. For example, losing 50 customers from a base of 500 gives a 10% churn rate for that period. This metric is typically measured monthly or annually and directly impacts recurring revenue. A high churn rate signals problems with product fit, customer service, or competitive pressure. Businesses subtract the churn rate from 100% to get the retention rate, and use both to model lifetime value and forecast subscriber counts. Even small reductions in churn — say from 5% to 4% monthly — can dramatically increase long-term revenue.
How to use
Suppose your SaaS product started January with 1,200 customers (totalCustomers = 1,200) and ended the month with 1,140, meaning 60 customers cancelled (customersLost = 60). Apply the formula: Churn Rate = (60 / 1,200) × 100 = 5%. This monthly churn rate of 5% means that if nothing changes, roughly 46% of today's customers will be gone within a year. Compare this result to your industry benchmark — for SaaS, a monthly churn below 2% is generally considered healthy.
Frequently asked questions
How do I calculate the customer churn rate for a subscription business?
Divide the number of customers lost during a period by the number of customers at the start of that period, then multiply by 100. The formula is Churn Rate = (customersLost / totalCustomers) × 100. If you had 800 customers at the start of the month and lost 32, your churn rate is 4%. It is important to use the starting count rather than the ending count in the denominator to keep the metric consistent and comparable across periods.
What is a good customer churn rate for a SaaS or subscription company?
Benchmarks differ by market segment: B2C subscription apps often see monthly churn of 5–7%, while B2B SaaS companies typically aim for 1–2% monthly or under 10% annually. Enterprise-focused software can sustain even lower churn due to long contract terms and high switching costs. The right target depends on your average contract value and customer acquisition cost — a high CAC requires very low churn to achieve a positive payback period. Comparing your rate to direct competitors in the same segment is more meaningful than using broad industry averages.
Why is reducing churn rate more impactful than increasing new customer acquisition?
Acquiring a new customer typically costs five to seven times more than retaining an existing one, so every customer saved has an outsized effect on profitability. Churn also compounds negatively: a 5% monthly churn rate means you lose more than half your base each year, requiring aggressive acquisition just to stay flat. Reducing churn by even one percentage point increases the average customer lifetime and therefore the lifetime value of your entire cohort. Investors in subscription businesses closely watch net revenue retention — which accounts for expansion revenue — as a proxy for product-market fit and growth efficiency.