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Customer Lifetime Value Calculator

Customer lifetime value (LTV) estimates the total profit a customer generates over their relationship with your business. Choose the e-commerce or subscription mode to see revenue LTV, gross profit LTV and your LTV-to-CAC ratio.

Last reviewed: 2026-07-29

Customer Lifetime Value Calculator inputs

Fill in the fields below, then select Calculate. Nothing is submitted automatically.

Average revenue per order.

How many times a customer buys per year.

Average number of years a customer remains active.

Profit margin on products sold.

For the LTV-to-CAC ratio.

Changing the currency changes formatting only. It does not convert values between currencies.

Calculations run locally in your browser. Your figures are not sent to a server or stored by us.

Results

Enter your figures above and select Calculate. Results appear here with clear labels — never colour alone.

What is customer lifetime value?

Customer Lifetime Value (LTV) estimates the total profit a single customer generates over their entire relationship with your business. It pairs with Customer Acquisition Cost (CAC) to answer a fundamental question: is each customer worth more than they cost to acquire?

This calculator offers two modes: an e-commerce formula based on order value and purchase frequency, and a subscription formula based on monthly revenue and churn rate. Both produce a gross profit LTV that accounts for your margin.

LTV formula

  • E-commerce Revenue LTV = AOV × Purchase Frequency × Lifespan
  • E-commerce Gross Profit LTV = Revenue LTV × Gross Margin %
  • Subscription Lifespan (months) = 1 ÷ Monthly Churn Rate
  • Subscription Gross Profit LTV = MRR × Gross Margin × Lifespan
  • LTV-to-CAC = Gross Profit LTV ÷ CAC

Worked example

An e-commerce store with $80 average order value, 4 purchases per year, 3-year lifespan and 40% gross margin.

  • Revenue LTV = $80 × 4 × 3 = $960
  • Gross Profit LTV = $960 × 0.40 = $384

If CAC is $100, the LTV-to-CAC ratio is $384 ÷ $100 = 3.84x.

How to use this calculator

Choose the e-commerce mode if you sell physical or digital products with repeat purchases. Enter your average order value, purchase frequency, customer lifespan and gross margin. Optionally enter CAC to see the LTV-to-CAC ratio.

Choose the subscription mode for SaaS or recurring-revenue businesses. Enter monthly revenue per customer, gross margin and monthly churn rate. The calculator estimates lifespan from churn and calculates gross profit LTV.

Interpreting the results

Gross profit LTV is the more conservative and useful figure because it accounts for the cost of delivering your product or service. Compare it against your CAC to assess acquisition efficiency.

For subscriptions, the CAC payback period shows how many months of revenue it takes to recover acquisition cost. Shorter payback periods mean faster return on sales and marketing investment.

Limitations and common mistakes

These LTV formulas are simplified estimates. They assume revenue, margins and churn remain constant over the customer's entire lifetime, which is rarely true in practice.

  • Using revenue LTV instead of gross profit LTV. Revenue overstates value if margins are thin.
  • Ignoring expansion revenue. Customers who upgrade or buy more over time have higher LTV than the formula suggests.
  • Assuming constant churn. Churn often changes as cohorts mature.
  • Comparing without context. LTV-to-CAC targets vary by business model. There is no universal number.

Frequently asked questions

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Disclaimer

Results from this calculator are estimates for general information only and are not financial, accounting, tax, investment or legal advice. Verify important figures with a qualified professional. Read our full disclaimer.