Customer LTV Calculator
Estimate how much revenue and gross profit a single customer generates over their lifetime and recommended CAC targets.
Customer Lifetime Value (LTV)
Enter the metrics below — results update instantly.
How LTV is Calculated
LTV = AOV × Purchase Frequency × Customer Lifespan
Example: If your average order is $75, customers buy 2.5 times per year, and stay active for 3 years, your LTV is $75 × 2.5 × 3 = $562.50. With a 40% margin, your LTV profit is $225.
What is Customer LTV?
Customer Lifetime Value (LTV) estimates the total revenue a business expects to receive from a single customer over the entire period they remain a customer.
How to Calculate
Multiply your average order value by the average number of purchases per year, then multiply by the average number of years a customer stays active. To estimate profit LTV, multiply revenue LTV by your gross margin.
Formulas
LTV (Revenue) = AOV × Frequency × Lifespan
LTV (Profit) = LTV (Revenue) × Gross Margin%
Annual Value = AOV × Frequency
Why It Matters
LTV helps you set sustainable CAC targets, decide how much to invest in growth, and prioritize retention vs acquisition. Comparing LTV to CAC determines if your unit economics are healthy.