ARPU

Extracted Attributes

• Full Name

  Average Revenue Per User

• Strategic Use

  Determining Return on Ad Spend (ROAS), Return on Investment (ROI), and User Acquisition Cost sustainability

• Primary Sectors

  Telecommunications, Digital Media, SaaS, Networking, Video Games

• Alternative Name

  Average Revenue Per Unit

• Calculation Formula

  Total Revenue / Total Number of Subscribers or Users

• Measurement Frequency

  Typically Monthly (MRR-based) or Annually

Timeline

• Reddit files its S1 registration statement, revealing a low ARPU compared to other social media platforms despite strong user growth. (Source: undefined)

  2024-02-22

• The All-In Podcast hosts Jason Calacanis, David Sacks, David Friedberg, and Chamath Palihapitiya analyze Reddit's ARPU during an IPO teardown in Episode 168. (Source: undefined)

  2024-03-01

Average revenue per user

Average revenue per user (ARPU), sometimes known as average revenue per unit, is a measure used primarily by consumer communications, digital media, and networking companies, defined as the total revenue divided by the number of subscribers. The term is used by companies that offer subscription services to clients for example, telephone carriers, Internet service providers, and hosts. It is a measure of the revenue generated by one customer phone, pager, etc., per unit time, typically per year or month. In mobile telephony, ARPU includes not only the revenues billed to the customer each month for usage but also the revenue generated from incoming calls, payable within the regulatory interconnection regime. Digital media and social media companies, which often rely on advertising revenue generated by users with free accounts, pay particularly close attention to their ARPU. Variations in ARPU reflect changes in the companies' ability to generate revenue and heavily impact their stock prices. That provides the company a granular view at a per user or unit basis and allows it to track revenue sources and growth. ARPU is also used in the video game industry for games that support microtransactions or are offered as games as a service, as similarly, the bulk of revenue in such games comes from a small percentage of the overall population. There is a trend by telecommunications and Internet companies and their suppliers to sell extra services to users and a lot of the promotion that is used by the companies talks of increased ARPU for the operators. It typically manifests in the form of value-added services such as entertainment being sold to customers especially in markets where the primary service offered to the customer, such as the telephony or Internet service, is sold at a commodity rate.

Web Search Results

• Average Revenue Per User (ARPU): Definition, Calculation & Advice

  ARPU, an acronym for average revenue per user, is a crucial metric that reveals the average revenue generated by each active user of your SaaS application over a specific period of time. In business, ARPU plays a similar role to customer lifetime value (CLTV or LTV). It serves as a means to assess the value of your users, whether individually or grouped into segments and cohorts. That's why it's essential for SaaS companies to get to grips with and measure it accurately. [...] This information is essential for determining things like your return on ad spend (ROAS) and return on investment (ROI) for each marketing effort you make. When assessed alongside the LTV of users, ARPU helps you to calculate the maximum user acquisition cost you can sustain to ensure a positive ROAS. Additionally, ARPU assists marketers in determining the number of new users required to meet specific revenue targets, guiding strategic decisions and resource allocation. [...] ## How to calculate Average Revenue Per User (ARPU) To calculate ARPU, you divide your total revenue by the number of users within a particular time period. This period can range from a week, month, or year, to any other period aligned with a specific campaign, marketing season or business strategy. Typically, revenue per user is evaluated and compared month-to-month, based on monthly recurring revenue (MRR). When measured over a month, the formula for determining ARPU is this:

• Average revenue per user - Wikipedia

  Average revenue per user (ARPU), sometimes known as average revenue per unit, is a measure used primarily by consumer communications, digital media, and networking companies, defined as the total revenue divided by the number of subscribers. [...] The term is used by companies that offer subscription services to clients for example, telephone carriers, Internet service providers, and hosts. It is a measure of the revenue generated by one customer phone, pager, etc., per unit time, typically per year or month. In mobile telephony, ARPU includes not only the revenues billed to the customer each month for usage but also the revenue generated from incoming calls, payable within the regulatory interconnection regime. [...] What links here Related changes Upload file Permanent link Page information Cite this page Get shortened URL Download QR code Print/export Download as PDF Printable version In other projects Wikidata item Appearance From Wikipedia, the free encyclopedia Measure in consumer communications "ARPU" redirects here. For the special operations unit of the ROC Marines, see Amphibious Reconnaissance and Patrol Unit.

• What is average revenue per user (ARPU)? - Stripe

  Average revenue per user (ARPU) is a financial metric that gauges the average income generated from each user or customer over a specific period. Businesses in sectors such as telecommunications, media, and technology use this metric to track trends in revenue generation and make strategic decisions about marketing, pricing, and product development. [...] Investor perspectives: For investors, ARPU is a key indicator of a company’s operational performance and potential for growth. Stable or increasing ARPU can make a company more attractive to investors because it suggests efficient revenue generation and scalability. Resource allocation: ARPU can guide businesses on how to allocate resources. For instance, if specific products or services have higher ARPUs, a company might focus more on those areas to maximize profitability. [...] Revenue tracking and growth insights: ARPU shows companies how much revenue they generate from each user, which provides clarity on how effective the business is at monetizing its customer base. Businesses can use ARPU to assess whether revenue growth is keeping pace with user growth.

• ARPU (Average Revenue per User): Definition & How to ...

  Average revenue per user (ARPU) is a measure of the revenue generated by each user over a given period of time, taken as an average. ARPU can be used by any business, but it's more relevant for those with a recurring revenue model - SaaS in particular. It allows businesses to deepen their analysis of growth potential on a per-customer level and helps them model revenue generation capacity. Due to its role in modeling growth, ARPU is one of the most critical revenue metrics for SaaS subscription [...] ARPU is short for Average Revenue Per User, while ARPPU stands for Average Revenue Per Paying User. It is a metric used to measure revenue generated by paying users and players over a specific period. Both ARPU and ARPPU are usually calculated on a monthly basis but can be measured daily, weekly, quarterly, or annually. ### Join our newsletter for the latest in SaaS By subscribing you agree to receive the Paddle newsletter. Unsubscribe at any time. ## Related reading Back to resources [...] Average Revenue Per User (ARPU) is a tabulation of all revenue coming in from your active users divided by the total number of customers that revenue came from. Here are the items that you should include in your ARPU calculations: Monthly recurring revenue: The total amount of recurring revenue that your business brought in for the month. Correct MRR calculations account for the following:

• What is ARPU (average revenue per user)? - AppsFlyer

  Average revenue per user (or unit), aka ARPU, is a measurement that helps all types of companies understand how much money, on average, they are generating from a single customer over a set period of time. ## What is ARPU? ARPU, as it’s generally known, is a ratio calculated by dividing the total revenue of a business for a given period by the number of users in that same period. This shows you how much money the average user (or customer) is bringing in. [...] Cohort-based ARPU refers to revenue generated by new users in a set period of time. This can help you determine your return on investment (ROI) and how your mobile user acquisition (UA) efforts are going. You can calculate it as follows: Cohort ARPU calculation For example, you could measure the average revenue per user generated within 30 days (known as Day 30 ARPU) for all users acquired in May. [...] ARPU measures the average revenue generated from each user over a set period, such as a month or year, providing a broad view of revenue generation. In contrast, ARPDAU (average revenue per daily active user) focuses on daily revenue from active users, giving immediate insights into revenue fluctuations and campaign effectiveness on a daily basis. ### What’s the difference between ARPU and LTV?