Average Revenue Per User (ARPU)
ARPU helps product and growth teams understand how effectively a product monetizes its audience. It is most useful when tracked over time and segmented by plan, geography, acquisition channel, or customer type. A rising ARPU can reflect price increases, stronger upsell, or greater use of paid features; a falling ARPU may indicate discounting, a shift toward lower-value users, or changes in the revenue mix.
What is Average Revenue Per User (ARPU)?
Average Revenue Per User (ARPU) is the revenue generated per active user during a defined period. It is calculated by dividing total revenue for the period by the number of active users measured in the same period.
Why it matters
ARPU helps product and growth teams understand how effectively a product monetizes its audience. It is most useful when tracked over time and segmented by plan, geography, acquisition channel, or customer type. A rising ARPU can reflect price increases, stronger upsell, or greater use of paid features; a falling ARPU may indicate discounting, a shift toward lower-value users, or changes in the revenue mix.
Example
A subscription app earns $120,000 in June from 20,000 active users. Its June ARPU is $6.