LTV to CAC Ratio Calculator

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Illustrative calculation; verify inputs and assumptions before relying on it.

LTV:CAC Ratio—

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LTV:CAC Ratio = LTV / CAC
Variable Meaning
CAC Customer acquisition cost.
LTV Customer lifetime value.

Worked example

LTV
$30,000
CAC
$5,000
→ LTV:CAC Ratio
6

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What LTV to CAC Ratio measures

Published by 4NLab · Updated · Our methods

LTV to CAC Ratio compares customer lifetime value against customer acquisition cost to evaluate acquisition efficiency.

Prepare your inputs

  1. Choose revenue LTV or gross profit LTV, label it, and keep that definition consistent across comparisons.
  2. Match the LTV cohort or segment to the CAC cost pool. Separate enterprise sales from self-service acquisition if their economics differ.
  3. Divide LTV by CAC and show a conservative alternative using shorter retention or lower margin. Add payback months so the timing of recovery remains visible.

Formula

LTV:CAC Ratio = LTV / CAC
Variable Meaning
CAC Customer acquisition cost.
LTV Customer lifetime value.

Check the sample calculation

Worked example

LTV
$30,000
CAC
$5,000
→ LTV:CAC Ratio
6

Before using the result

  • A 3× revenue-based ratio is not equivalent to a 3× gross-profit-based ratio.
  • LTV is modeled over a customer lifetime while CAC is incurred near acquisition; the ratio does not tell you when cash returns.
  • A zero CAC makes the ratio undefined. Organic acquisition often has people and content costs even if advertising spend is zero.

A dash means the result is undefined for the inputs, such as division by zero. Review the assumptions and input errors before interpreting it.

Read the LTV to CAC Ratio guide for a business scenario, interpretation, and frequently asked questions.

Sources and methodology

The references below explain the underlying methods. Our worked scenarios use hypothetical figures; they are not company results or current market benchmarks.

Found an error or a definition that differs from your reporting? Send a correction with the page URL and the method you use.