About the ARPU Calculator
This ARPU calculator divides revenue by users to show how much the average customer is worth in a period. Enter total revenue, the average number of active users and how many of them pay, and it returns ARPU (average revenue per user), ARPPU (average revenue per paying user) and, if you sell to companies, ARPA (average revenue per account).
It is useful for SaaS and subscription businesses, mobile apps and games with a free tier, telecoms and media companies — anyone who needs to compare monetisation across periods, pricing tiers or markets. Because revenue can be reported monthly, quarterly or yearly, the calculator also converts ARPU to monthly and annual equivalents so figures from different reports line up.
Use the average number of users during the period (for example, the mean of the starting and ending counts) rather than the end-of-period figure, especially when you are growing quickly. For SaaS metrics, count recurring revenue only and exclude one-off fees.
With the default inputs, the arpu (for the period) is $30.00. Change any value above to recalculate instantly.
How to use the arpu calculator
- 1Enter total revenue for the period and choose month, quarter or year.
- 2Enter the average number of active users in that period.
- 3Enter the average number of paying users.
- 4For B2B products, enter paying accounts to get ARPA.
- 5Compare ARPU, ARPPU and ARPA and their monthly and annual equivalents.
Formula and method
ARPU spreads all revenue in a period across every active user, free or paid, so it reflects both pricing and how well you convert users to paying customers. ARPPU uses only paying users as the denominator and shows what a customer is worth once they pay. ARPA is the B2B equivalent, dividing revenue by paying company accounts regardless of how many seats each has.
The monthly equivalent divides period ARPU by the number of months in the period (3 for a quarter, 12 for a year), and the annual equivalent multiplies the monthly figure by 12. Using the average user count across the period avoids overstating or understating ARPU when your user base is changing quickly.
- ARPU
- Average revenue per user
- ARPPU
- Average revenue per paying user
- ARPA
- Average revenue per account
Worked examples
Freemium SaaS: $150k in a month
Spreading $150,000 across 5,000 active users gives ARPU of $30. Only 600 users pay, so ARPPU is $250, and with 500 paying accounts ARPA is $300. Annualised, the average user is worth $360.
Quarterly revenue report
Quarterly ARPU is $900,000 ÷ 20,000 = $45, which is $15 a month or $180 a year. Paying users generate $450 each per quarter.
Consumer app with a large free tier
A year of $2.4M revenue across 400,000 users is an ARPU of just $6 (50 cents a month), but the 4% who pay are worth $150 each. Improving conversion would move ARPU far more than raising prices.
Frequently asked questions
How do you calculate ARPU?+
Divide total revenue for a period by the average number of users in that period. For example, $150,000 of monthly revenue and 5,000 average users gives an ARPU of $30 per month.
What is the difference between ARPU and ARPPU?+
ARPU divides revenue by all users, including free users. ARPPU divides revenue only by paying users. In freemium products ARPPU is much higher, and the gap between them reflects your free-to-paid conversion rate.
What is ARPA?+
ARPA is average revenue per account, used by B2B SaaS companies where one customer account may have many users or seats. It is revenue divided by the number of paying accounts.
Should I use start, end or average user counts?+
Use the average number of users over the period. End-of-period counts understate ARPU when you are growing and overstate it when shrinking, because new users did not contribute a full period of revenue.
How is ARPU used with LTV?+
Customer lifetime value is monthly revenue per paying customer (ARPPU or ARPA) × gross margin ÷ monthly customer churn. Use the paying-customer figure, not blended ARPU, because churn and CAC are measured on paying customers; blended ARPU would understate LTV in a freemium product.