LTV
Customer Lifetime Value: the total contribution a customer is expected to bring over the whole relationship, usually calculated on gross profit.
Core MetricsTerm 27 / 81
Formula
LTV = ARPU × Gross margin ÷ Churn rate (simple model)
In practice
LTV is an estimate, not a measurement; a small change in churn moves it a lot. Use gross margin, not revenue, and trust it only for cohorts with real retention data.