SaaS & retention
SaaS Quick Ratio Calculator
Compare recurring revenue inflows from new and expanding customers with losses from churn and contraction.
Use this as a same-period SaaS revenue movement ratio. Define inflows and outflows on one cohort scope, and do not treat it as cash liquidity or a quality benchmark.
What the result means
A 5x result means 5 currency units of recurring-revenue inflow for each unit lost in the same period. A zero-loss period has no defined ratio rather than an infinite business quality score.
The formula
(New business revenue + expansion revenue) / (churned revenue + contraction revenue)
Results are displayed to at most two decimal places. Calculations use the unrounded inputs.
A worked example
Put the formula to work
- New business revenue (currency per period)
- 10,000
- Expansion revenue (currency per period)
- 5,000
- Churned revenue (currency per period)
- 2,000
- Contraction revenue (currency per period)
- 1,000
SaaS quick ratio: 5x
Inflows of 15,000 divided by 3,000 of recurring-revenue losses produce a 5x SaaS quick ratio.
How to use this calculator
- Choose one period and recurring-revenue basis.
- Add new-customer and existing-customer expansion inflows.
- Add churn and contraction outflows without double-counting.
- Divide inflows by outflows and record a zero-outflow period as undefined.
Why this number matters
The ratio separates the sources of recurring-revenue movement instead of looking only at net change.
Input definitions
- New business revenue (currency per period)
- Recurring revenue added by newly acquired customers in the period.
- Expansion revenue (currency per period)
- Recurring revenue added by existing customers through upgrades or added usage.
- Churned revenue (currency per period)
- Recurring revenue lost when existing customers fully leave.
- Contraction revenue (currency per period)
- Recurring revenue lost from downgrades or reduced seats among retained customers.
Assumptions and limitations
- It is not a cash quick ratio or a liquidity test.
- Definitions of new, expansion, churn, and contraction vary by billing model.
- A single period can be distorted by contract timing and large deals.
Methodology
The default result and worked example use the same calculation functions as the interactive tool. The formula cannot verify the quality or scope of your source data.
Read our calculation methodology
Last updated .