How to calculate revenue churn?

1Answer

Revenue churn can be measured in a number of ways. The most popular is probably Net Revenue Retention, which looks at a specific timeframe and considers adjustments in account value (i.e. upsells and downsells) over that period. If revenue from upsells can offset or surpass revenue from downsells and churned customers, the Net Revenue Retention Rate can be greater than 100 percent, which is known as negative churn. A Net Revenue Retention Rate of 110 percent or higher is considered world-class in subscription businesses, especially in SaaS.

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