Net Revenue Churn

Net change in revenue from existing customers.

Net Revenue Churn

Net change in revenue from existing customers.

Net Revenue Churn

Net change in revenue from existing customers.

Formula

Net Revenue Churn = (Revenue Lost - Revenue Gained from Existing Customers) / Initial Revenue * 100

Know your metric

Importance of

Net Revenue Churn

  1. Customer Retention Insight

Net revenue churn provides valuable insights into customer retention and satisfaction, indicating the financial impact of lost customers adjusted for new revenue from existing customers.


  1. Business Health Indicator

Low or negative net revenue churn is a strong indicator of business health and customer loyalty.


  1. Revenue Forecasting

This metric helps in more accurate revenue forecasting by accounting for both churn and growth within the existing customer base.

Drawbacks of

Net Revenue Churn

  1. Complex to Calculate

Net revenue churn can be complex to calculate, especially for businesses with a variety of revenue streams and customer arrangements.


  1. Can Mask Underlying Issues

It can mask underlying issues if new upsells or expansions compensate for lost revenue, potentially leading to strategic complacency.


  1. Sensitive to Market Changes

External market changes can significantly impact net revenue churn, making it a volatile metric that requires contextual interpretation.

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