ARPU

Formula

Total revenue / users (or installs)

Unit

$

Models

All models

What it is

ARPU (Average Revenue Per User) measures average revenue generated per user or install over a given period. It equals total revenue divided by total users (or installs), and can be calculated at any time horizon (daily, monthly, annual).

How to calculate it

Divide total revenue for a period by the total user or install count for that same period. The denominator should be clearly defined — active users, registered users, or installs — and held constant across measurement periods to enable trend comparisons. Mobile contexts often compute this at a fixed post-install day (e.g., D60 revenue per install).

Why it matters

ARPU benchmarks the revenue efficiency of your user base and informs unit economics across models. It is a key input to LTV calculations and helps size the total addressable revenue opportunity per acquired user. Wide variation by segment or product line often signals monetization headroom or a need for product or pricing differentiation.

Benchmarks & pitfalls

According to RevenueCat, Sacra, and a16z (2024–26), mobile ARPU varies sharply by category — Health & Fitness apps show a D60 RPI of approximately $0.66. In fintech, neobanks generate roughly $45–80 per user per year; comparables include Chime ($214/yr), Nubank ($102/yr), and Wise (~$111/yr). Traditional banks sit around $350/yr, highlighting the significant monetization gap neobanks must close. A key pitfall is mixing user definitions: ARPU over registered users will be much lower than ARPU over paying users (ARPPU), so always specify the denominator when reporting or comparing.