Churn
Churn is the revenue or customers lost when subscriptions end, either because the customer cancels (voluntary) or because payment fails and is not recovered (involuntary). Churn caps growth: a product that adds 5% MRR a month and loses 5% stays flat. Splitting voluntary from involuntary churn tells you whether to fix the product or the billing.
Formula
churned MRR(period) = Σ MRR of subscriptions cancelled or ended in the period; churn rate = churned MRR / MRR at start × 100Add the monthly value of subscriptions that were cancelled or ended during the period, and divide by MRR at the start of the period for a rate.
Worked example
| MRR on 1 April | $10,000 |
|---|---|
| Cancelled in April | $300 |
| Failed payments not recovered | $200 |
- Churned MRR: $300 + $200 = $500
- $500 / $10,000 × 100 = 5%
April churn is 5%: 3% voluntary and 2% involuntary.
How ProductLense shows it
ProductLense shows churned MRR for the selected period on the Revenue page, from subscriptions whose cancelled or ended date falls in the range. Net revenue retention cohorts by channel show which channels’ customers churn faster over 12 months.
A billing connection with subscriptions. Subscription statuses are normalised to active, trialing, past_due, paused, canceled and ended across providers, so churn is comparable between Stripe, Paddle and the rest.
Churn: questions
- What is churn?
- Churn is the revenue or customers lost when subscriptions end, either because the customer cancels (voluntary) or because payment fails and is not recovered (involuntary). Churn caps growth: a product that adds 5% MRR a month and loses 5% stays flat. Splitting voluntary from involuntary churn tells you whether to fix the product or the billing.
- How do you calculate churn?
- Add the monthly value of subscriptions that were cancelled or ended during the period, and divide by MRR at the start of the period for a rate. For example, $300 cancelled plus $200 of failed payments against $10,000 of MRR is 5% churn.
- Where does ProductLense show churn?
- ProductLense shows churned MRR for the selected period on the Revenue page, from subscriptions whose cancelled or ended date falls in the range. Net revenue retention cohorts by channel show which channels’ customers churn faster over 12 months.
- What does ProductLense need to calculate churn?
- A billing connection with subscriptions. Subscription statuses are normalised to active, trialing, past_due, paused, canceled and ended across providers, so churn is comparable between Stripe, Paddle and the rest.
- How is churn different from NRR?
- Churn counts what left; net revenue retention counts what stayed, including expansion. A cohort with 5% monthly churn can still hold 100% NRR if remaining customers upgrade enough, which is why ProductLense shows the cohort view by channel.
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