SaaS Metric
Average Revenue Per Account (ARPA)
Definition
Average revenue per account (ARPA), sometimes called ARPU, is the average recurring revenue generated per customer account in a period. ARPA = total MRR ÷ number of active accounts. Rising ARPA signals successful upsell, pricing power or a move upmarket, and it feeds directly into customer lifetime value.
Formula
ARPA = total MRR ÷ number of active accounts
Benchmark
ARPA varies hugely by segment and price point. What matters is the trend: rising ARPA from expansion or upmarket movement is a healthy growth lever.
Why ARPA matters
ARPA is a lever on lifetime value: because LTV = (ARPA × gross margin) ÷ churn, raising ARPA directly raises LTV. Expansion revenue, better packaging and moving upmarket all push ARPA up.
Track new-customer ARPA separately from blended ARPA. Rising new-customer ARPA is a strong signal of pricing power or a successful upmarket shift, while blended ARPA can be dragged by a long tail of legacy plans.
Frequently asked questions
How do you calculate ARPA?
ARPA = total MRR ÷ number of active accounts for the period. Use ARPU interchangeably when your unit is a user rather than an account.
What is the difference between ARPA and ARPU?
They are essentially the same calculation; ARPA divides by accounts (companies) and ARPU divides by users. B2B SaaS usually tracks ARPA; consumer products often track ARPU.
Related metrics
Customer Lifetime Value (LTV)
Customer lifetime value (LTV) estimates the gross-margin revenue an average customer generates before churning. Learn the margin-adjusted LTV formula, the LTV:CAC ratio, and benchmarks.
Monthly Recurring Revenue (MRR)
Monthly recurring revenue (MRR) is the normalised, predictable subscription revenue earned each month. Learn the MRR formula, its movement components, and how it relates to ARR.
Expansion Revenue
Expansion revenue is additional recurring revenue from existing customers via upgrades, seats and cross-sells. Learn how it drives net negative churn and NRR above 100%.
Track this automatically
Connect Stripe and RetentionLens computes ARPA for you — with cohorts, trends and churn-risk scoring. Start on the free tier.
Benchmarks are general SaaS ranges and vary by segment, stage and business model. Last reviewed 2026-05-30.