Revenue Churn Rate vs Churn Rate
Customer churn counts the percentage of customers lost; revenue churn counts the percentage of MRR lost. Losing a large enterprise customer can have a small customer-count impact but a massive revenue impact — and vice versa. Both metrics should be tracked to get the full picture.
At a Glance
Revenue Churn Rate
Percentage of recurring revenue lost from cancellations in a period
Churn Rate
Percentage of customers lost over a given time period
Key Differences
- Revenue churn weights churned dollars, not just headcount.
- Customer churn treats a $500/month customer the same as a $50,000/month customer.
- Revenue churn is typically lower than customer churn if large customers retain better.
- For SMB-focused products, both metrics often move together.
When to Use Each
Use Revenue Churn Rate when…
Use revenue churn when you have a wide spread of customer sizes. A few large account churns may represent the majority of your actual risk.
Full Revenue Churn Rate guide →Use Churn Rate when…
Use customer churn rate to track overall product-market fit and support volume across your entire customer base, regardless of deal size.
Full Churn Rate guide →Formulas
REVENUE CHURN RATE
Revenue Churn Rate = (MRR Lost to Cancellations / Beginning MRR) × 100
((Churned MRR - Expansion MRR) / Starting MRR) × 100CHURN RATE
Churn Rate = (Customers Lost During Period / Customers at Start of Period) × 100
(MRR Lost to Cancellations / MRR at Start of Period) × 100Charts
Revenue Churn Rate
Churn Rate