Free online calculator
LTV to CAC Ratio Calculator
Compare a customer lifetime value estimate with the cost of acquiring a customer from the same segment or cohort.. Includes a worked example, formula and practical FAQs.
Formula: LTV:CAC ratio = customer lifetime value ÷ acquisition cost
How to use the LTV to CAC Ratio Calculator
Compare a customer lifetime value estimate with the cost of acquiring a customer from the same segment or cohort.
Formula
LTV:CAC ratio = LTV ÷ CAC; value less acquisition cost = LTV − CAC.
Worked example
LTV of $240 and CAC of $60 give a 4× ratio and a $180 difference.
Interpretation and limitations
CAC must be positive. Definitions matter: revenue-based LTV and margin-based LTV cannot be compared interchangeably. The difference is not automatically net profit after all overhead.
LTV to CAC Ratio questions
Is a 3× or 4× ratio always healthy?
No single ratio fits every business. Payback speed, retention uncertainty, capital needs and omitted costs also matter.
Does the ratio measure how quickly I recover CAC?
No. It compares total amounts without cash-flow timing. Payback needs revenue or margin earned over time.
Continue your calculation
For the next step, use the Customer Lifetime Value Calculator or the Customer Acquisition Cost Calculator. Review each tool’s input definitions before carrying a result into another calculation.
Frequently asked questions
Is this calculator free?
Yes. It runs in your browser and does not require an account.
How should I use the result?
Use the result as a planning estimate and verify business-critical decisions against your source records.