What Is ARPU (Average Revenue Per User)?
The average monthly revenue generated per user or account.
The average monthly revenue generated per user or account.
Average Revenue Per User (ARPU) — sometimes called Average Revenue Per Account (ARPA) — measures the average monthly revenue generated from each customer or account.
ARPU trends tell you whether your pricing and packaging strategy is working. Rising ARPU typically means customers are upgrading to higher tiers or adopting add-ons, while declining ARPU may signal pricing pressure or a shift toward smaller customers.
ARPU is a key input for calculating LTV and is important for forecasting revenue growth. Tracking ARPU by cohort can reveal how customer quality changes over time.
Formula
ARPU = MRR ÷ Total Number of Active Users/Accounts
Example
If your MRR is $100,000 with 2,000 accounts, your ARPU is $50.
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