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Accounting Average Revenue per User (Annual) Calculator

Calculate annual average revenue per user by dividing total annual revenue by your average number of users during the year.

Your Details

Overview

This annual ARPU calculator estimates the average revenue earned from each user over a year. Enter your total annual revenue and your user counts at the start and end of the year to calculate annual average revenue per user.

How it works

The calculator first finds the average user base by adding the number of users at the start and end of the year and dividing by two. It then divides total annual revenue by that average user count. For example, a business with $1,200,000 in annual revenue and an average of 1,000 users has annual ARPU of $1,200 per user.

How to use this calculator

  1. 1Enter the total revenue recognized during the year.
  2. 2Enter the number of active users at the start of the year.
  3. 3Enter the number of active users at the end of the year.
  4. 4Review the average user count and annual revenue per user.
  5. 5Compare the result with prior periods or user segments using consistent definitions.

Example Calculation

Total annual revenue

$1,200,000

Users at start of year

900

Users at end of year

1100

Annual average revenue per user

$1,200.00

With $1,200,000 of annual revenue and an average of 1,000 users, annual ARPU is $1,200 per user per year.

Frequently asked questions

What is annual ARPU?

Annual average revenue per user, or ARPU, is the total revenue earned over a year divided by the average number of users in that year.

How do you calculate annual ARPU?

Calculate the average user count, then divide annual revenue by that figure. This calculator uses the average of starting and ending users.

Should refunds be included in annual revenue?

Use a revenue figure that follows your normal reporting policy. For consistent comparisons, treat refunds, discounts, and taxes the same way in every period.

What is the difference between annual ARPU and monthly ARPU?

Annual ARPU measures revenue per user over a full year. Monthly ARPU measures revenue per user for a month; multiplying monthly ARPU by 12 may not equal annual ARPU if users or revenue vary during the year.

Why use average users instead of ending users?

Using an average user count generally better reflects the user base that generated revenue throughout the year, especially when users were added or lost during the period.

When is the simple average user method less accurate?

It can be less accurate if the user base changed sharply during the year. In that case, using monthly average user counts can provide a more representative ARPU measure.

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Assumptions and warnings

Assumptions

  • ARPU is calculated as total annual revenue divided by the simple average of users at the beginning and end of the year.
  • All revenue and user counts relate to the same 12-month reporting period.
  • Users are counted consistently at both the start and end of the year.
  • The calculation does not separate revenue by plan, product, geography, taxes, refunds, or user segment unless those amounts are excluded from the revenue entered.

Warnings

  • This calculator provides a business metric estimate and is not accounting, tax, or financial advice.
  • A simple start-and-end user average may be less accurate when the user base changes substantially during the year.