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Calculator

Churn Rate Calculator

Enter how many customers you started a period with and how many you lost, and this calculator gives you the churn rate and the retention rate. Add the number of new customers you won and it will also show the net change in your customer base. Nothing you type leaves your browser.

Enter how many customers you started the period with to see a result.

How this works

Churn rate is the customers you lost during the period divided by the customers you had at the start of it, expressed as a percentage. Retention rate is simply what is left: 100% minus the churn rate.

The important detail is the denominator. New customers won during the period are deliberately excluded from it, and this is the standard calculation for a good reason. If you included them, a month in which you signed a lot of new business would show artificially low churn, because the denominator would be inflated by customers who had barely had time to leave. You would be able to hide a retention problem simply by selling harder, which is exactly what a churn metric exists to prevent.

So the denominator is a fixed group: the customers who were with you on day one of the period, all of whom had the full period in which to leave. That keeps the number comparable from one month to the next.

If you enter new customers, the calculator shows the net change separately — your closing customer count and whether the base grew or shrank. That is a useful number, but it is a growth figure, not a churn figure, and the two should never be blended into one.

A worked example

A business starts the quarter with 400 customers. During the quarter it loses 18 of them and signs 30 new ones.

Churn rate: 18 ÷ 400 = 4.5%.

Retention rate: 100% − 4.5% = 95.5%.

Closing customers: 400 − 18 + 30 = 412, a net change of +12, or +3.0%.

Note what would happen with the wrong denominator. Dividing 18 by the closing figure of 412 gives 4.4%, and dividing by the 430 customers who passed through at some point gives 4.2%. None of these are wildly different in a quarter this steady, but in a fast-growing month the gap becomes large, and always in the flattering direction. Pick the standard calculation and stick with it.

What this doesn't account for

This measures customer churn, not revenue churn, and they can point in opposite directions. Losing 18 small accounts while retaining every large one is a very different quarter from losing your two biggest customers, but customer churn would rate the second one better. If your accounts vary a lot in size, calculate revenue churn as well — lost monthly revenue divided by the monthly revenue you started with.

It also takes no account of expansion. Net revenue retention, which sets upgrades and price rises against losses, can exceed 100% even while customer churn is positive. That is a genuinely different picture and worth measuring separately if a meaningful share of your revenue comes from growing existing accounts.

Comparing churn across different period lengths does not work either. A monthly rate and a quarterly rate are not the same animal, and you cannot simply multiply a monthly figure by twelve to get an annual one, because the base shrinks each month as customers leave. Compare months with months.

Finally, a churn rate tells you nothing about cause. The number moves for reasons that show up long before the cancellation — during onboarding, or in a renewal nobody prepared for. It is a symptom, and treating renewals as something you have to earn does more for it than measuring more often.

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