Churn Rate Calculator
Losing 3.00% a month adds up to 30.6% of customers in a year.
How the churn rate calculation works
Divide customers lost by customers at the start
Losing 24 of the 800 customers you started the month with is a 3.00% monthly churn rate.
Leave new customers out of the rate
Customers who joined during the period weren't at risk at the start, so counting them would make churn look lower than it is.
Annual churn compounds
Annual churn = 1 − (1 − monthly churn)^12. 3% a month is 30.6% a year, not 36%.
Average lifetime is the inverse
1 ÷ churn rate gives the average customer lifetime. At 3% a month that's about 33 months.
Worked example. You start the month with 800 customers, lose 24 and gain 60. Churn is 24 ÷ 800 = 3.00%, retention 97.00%, annual churn 30.6%, and you end with 836 customers.
Churn Rate FAQ
What is churn rate?
Churn rate is the share of your customers who leave in a period: they cancel, stop paying or don't renew. It is usually given per month for subscriptions and per year for contracts.
How do I calculate churn rate?
Use the churn rate formula: customers lost during the period ÷ customers at the start × 100. 15 cancellations from 500 subscribers is 3%.
What is the retention rate formula?
Customer retention rate = (customers at end − new customers) ÷ customers at start × 100. With 800 at the start, 836 at the end and 60 new, that is 776 ÷ 800 = 97%. It is the same as 100% minus the churn rate.
How do I convert monthly churn to annual churn?
Annual churn = 1 − (1 − monthly churn)^12. 2% a month is 21.5% a year.
What is the difference between churn and retention?
They add up to 100%. A 3% churn rate means a 97% retention rate for the same period.
What is a good churn rate?
There is no single good number. It depends on price, contract length and type of customer: monthly plans for small businesses churn faster than annual contracts. Compare with your own past months, and look at why customers cancel.
Why does Stripe show a different churn rate?
Stripe Billing divides churned subscribers by subscribers at the start plus new subscribers in the past 30 days. Its own example: 100 lost from 1,000 + 100 is 9.1%. This calculator divides by the starting count only, so the same month is 10%.
Should I count new customers who cancel in the same month?
Not in this month's rate, since they weren't in the starting count. Some teams count them separately as early churn.
Sources: Stripe Docs: Billing analytics, subscriber churn rate