AI Unit Economics Calculator

An AI unit economics calculator analyses the per-customer financial metrics that determine whether an AI product is a viable, scalable business. Unit economics answers the question: "For every customer we acquire, do we make or lose money — and by how much?" The key metrics are LTV (Lifetime Value — how much revenue a customer generates over their lifetime), CAC (Customer Acquisition Cost — how much it costs to acquire them), and the LTV:CAC ratio (how efficiently the business converts acquisition spend into lifetime revenue). For AI SaaS, two additional metrics matter critically: gross margin (which is lower than traditional SaaS due to variable LLM API costs) and NRR (Net Revenue Retention — whether existing customers grow their revenue over time). Together these metrics form the unit economics framework investors and operators use to evaluate the health and scalability of an AI business.

1. Enter Revenue Inputs: Set your ARPU (average monthly revenue per customer), active customer count, monthly churn rate, and expansion revenue rate. The calculator instantly computes MRR, ARR, average customer lifetime in months, and NRR.
2. Set Cost Inputs: Enter your COGS as a percentage of ARPU (LLM API usage, hosting, support tools), your blended CAC (total sales and marketing spend divided by new customers acquired), and your fixed monthly operating expenses (salaries, rent, tooling). The calculator computes gross profit, contribution margin, and operating income.
3. View Unit Economics Metrics: LTV, LTV:CAC ratio, CAC payback period, gross margin, contribution margin, operating margin, break-even customer count, and the SaaS magic number all update in real time. Each metric is benchmarked against SaaS industry standards with an Excellent / Good / Acceptable / Poor rating.
4. Analyse the P&L and LTV:CAC Chart:See a full monthly P&L (revenue → COGS → gross profit → OpEx → operating income) and a visual CAC vs LTV comparison showing how much of your LTV is consumed by customer acquisition cost.

• LTV (Lifetime Value): LTV = (ARPU × Gross Margin%) ÷ Monthly Churn Rate. This represents the total gross profit a typical customer generates over their lifetime. With expansion revenue, effective ARPU grows over time, significantly increasing LTV. A customer with 2.5% monthly churn has an average lifetime of 40 months.
• LTV:CAC Ratio: The gold standard SaaS efficiency metric. Above 3× is considered excellent for a scaling B2B SaaS. Above 5× may indicate under-investment in growth. Below 1× means you are spending more to acquire customers than they will ever return — unsustainable without external funding.
• Contribution Margin: ARPU minus direct COGS per customer. This is the amount each customer contributes toward fixed costs and profit each month. Contribution margin break-even = Total Fixed Monthly Costs ÷ Contribution Margin per Customer.
• SaaS Magic Number:Net New ARR generated per dollar of S&M spent. Above 0.75 indicates efficient go-to-market spending. Below 0.5 suggests the GTM motion needs work before scaling spend. This calculator approximates it using estimated S&M as 40% of operating expenses.

Industry benchmarks for AI SaaS unit economics: LTV:CAC ≥3× (excellent), CAC payback ≤12 months (excellent), gross margin ≥65% (excellent — note AI SaaS gross margins are typically 10–20% lower than traditional SaaS due to LLM API costs), NRR ≥110% (strong). This AI unit economics calculator uses the standard LTV formula and assumes constant churn and expansion rates. In practice, cohort churn improves as the product matures, expansion revenue compounds non-linearly, and COGS efficiency improves with scale. Use this tool for planning and directional analysis — validate with cohort-specific data for investor presentations. All calculations run locally in your browser; no data is sent to any server.