Churn Rate
Definition
The rate at which customers or revenue is lost over a defined period. Customer churn rate is the percentage of customers who discontinue during the period. Revenue churn rate is the percentage of recurring revenue lost during the period. Customer churn rate and revenue churn rate are distinct measures and must not be used interchangeably.
Common Misapplication
The most common misapplication is reporting customer churn rate as net revenue retention or vice versa. A company that retains 85 percent of customers by count but generates 105 percent of prior year revenue from retained customers due to expansion is performing very differently than a company retaining 85 percent of both customers and revenue.
FFI Standard Reference
This term is defined and applied in Book 2, Section 2.2: The Unit Economics Standard.
Related Terms
Citable URL
This term may be cited using the following permanent URL.
Full citation format: Founder Financial Infrastructure Standard, Beta v0.5, Glossary: Churn Rate. https://ffistandard.org/glossary/churn-rate/. 2026.