Can a monthly churn rate be multiplied by twelve to get an annual rate?

No, because churn compounds and each month applies to a smaller base. At 4 percent monthly churn about 61 percent of the original customers remain after a year, so annual churn is close to 39 percent rather than 48 percent.

What is a good churn rate?

An absolute figure means nothing without context. Subscription length, contract type, the mix of acquisition channels and the strictness of the churn definition each move the number by a wide margin, so a figure taken from another market's report does not transfer. The valid comparison is against the product's own history and between entry cohorts.

Churn Rate

Intermediate

Updated Jul 11, 2026 Shahin editorial 2 min read

PronunciationEN/tʃɜːrn reɪt/

Churn rate is the share of the customers active at the start of a period who had been lost by the end of it, expressed as a percentage.

The denominator is the population at the start of the window, not the average population and not the population at the end. Adding customers acquired during the window dilutes the rate and hides part of the erosion. Rates computed over windows of different lengths are not comparable, and a monthly rate does not annualise by multiplying by twelve, because the base shrinks every month. The metric also hides who left: losing 100 trial users and losing 100 long-standing heavy accounts produce the same figure and very different damage, which is why revenue churn is reported next to it. There is no universal good value either, since contract length, sector and the churn definition itself move the number, and imported benchmarks do not transfer.

How it is calculated

Churn rate = customers lost during the period ÷ customers active at the start of that period

The denominator is the population at the start of the window and excludes customers acquired during it. The numerator follows the product's own churn definition: a cancellation or non-renewal event in a subscription product, and crossing an inactivity threshold otherwise. The unit is a percentage, and the window length is part of the metric definition, so monthly and annual churn are two separate metrics.

FAQ

Sources:Amplitude glossary — Churn rate