Average Revenue Per User (ARPU) is a 🏷️#financial-metric giving the mean revenue a business generates per user or account over a defined period, found by dividing total revenue in that period by the number of users in it.
The metric is period-bound, and the period is the part most often left implicit. ARPU can be reported monthly, quarterly, or annually, and the same business produces very different figures depending on the window — which is why the reporting period should always travel with the number. Companies also differ on the denominator: total registered users, monthly active users, or paying accounts only. Where the unit is an account rather than an individual, the figure is often reported instead as ARPA, average revenue per account, a distinction that matters for business-to-business products where a single account carries many seats.
ARPU is most at home in subscription, telecom, and advertising-supported businesses, where it sits alongside 📝Monthly Recurring Revenue (MRR) and 📝Annual Recurring Revenue (ARR) as a measure of monetization depth rather than of scale. Recurring-revenue metrics describe how large the paying base is; ARPU describes what each member of it is worth. Read against 📝Customer Acquisition Cost (CAC) and 📝Lifetime Value (LTV), it indicates whether a pricing model can carry the cost of growth.
A rising ARPU usually reflects successful upselling, a price increase, or a mix shift toward higher tiers — but it can equally reflect the departure of low-value users, which shrinks the denominator without adding a dollar of revenue. That ambiguity is why the metric is read alongside user growth and churn rather than on its own.