Calculate what each customer is truly worth to your business
Calculator Mode
Mean revenue per purchase
How many times per year a customer buys
Revenue minus direct costs
How long a typical customer stays
LTV Results
LTV Health
Healthy
Strong LTV — optimize CAC to keep payback under 12 months.
Implied Churn
33.3%
per year
LTV : CAC Ratio
Enter your Customer Acquisition Cost to see your LTV:CAC ratio. A healthy ratio is 3:1 or higher.
Sensitivity — Improve Retention
See how extending customer lifespan impacts Gross-Profit LTV (all other inputs held constant).
50% of lifespan
$306
1.5 yr lifespan
Baseline
$612
3.0 yr lifespan
1.5× lifespan
$918
4.5 yr lifespan
2× lifespan
$1,224
6.0 yr lifespan
3× lifespan
$1,836
9.0 yr lifespan
5× lifespan
$3,060
15.0 yr lifespan
Disclaimer: LTV calculations are estimates based on average historical behavior. Actual values depend on customer mix, seasonality, product changes, and market conditions. The discounted LTV uses a simplified DCF model with a constant discount rate. Use these figures as directional benchmarks, not guarantees.
The Customer Lifetime Value (LTV) calculator tells you exactly how much revenue a single customer generates over their entire relationship with your business. Enter your average order value, purchase frequency, and customer lifespan to get simple LTV, gross-profit LTV, and — in advanced mode — a discounted cash-flow LTV with your LTV:CAC payback ratio.
LTV is the total net revenue or gross profit a business expects from a single customer over the entire duration of their relationship. It's calculated as: LTV = Average Order Value × Purchase Frequency × Customer Lifespan. Measuring LTV helps you decide how much you can afford to spend acquiring a new customer.
A ratio of 3:1 or higher is generally considered healthy — meaning you earn $3 in lifetime gross profit for every $1 spent acquiring a customer. Ratios below 1:1 mean you're losing money on each customer. SaaS and subscription businesses often target 5:1 or higher.
They're inversely related: Customer Lifespan (years) = 1 ÷ Annual Churn Rate. For example, a 25% annual churn rate implies an average customer lifespan of 4 years. Reducing churn by even a few percentage points can dramatically increase LTV.
Simple LTV multiplies annual gross profit by customer lifespan without accounting for the time value of money. Discounted (DCF) LTV applies a discount rate — typically your cost of capital or a hurdle rate — to reflect that future cash flows are worth less than dollars earned today. DCF LTV gives a more conservative and financially rigorous estimate.