How to use this tool
- Enter starting period revenue, ending period revenue, years between periods.
- Select Calculate to view the result.
- Check the method and assumptions below before using the result.
The method, explained
Revenue CAGR = [(ending revenue ÷ starting revenue)^(1 ÷ years) − 1] × 100. Total growth = (ending revenue ÷ starting revenue − 1) × 100.
Annual revenue rising from 100,000 to 144,000 over two years has a 20% annualized growth rate and 44% total growth.
What to keep in mind
Compare equal-length reporting periods, such as annual revenue to annual revenue. CAGR smooths intervening fluctuations and is not an actual year-by-year history. Starting revenue must be positive; ending revenue cannot be negative.
Common questions
Why is CAGR different from total growth?
Total growth covers the entire interval. CAGR expresses the constant compounded yearly rate that would connect the endpoints.
Can I enter six months?
Yes. Enter 0.5 years and compare equivalent revenue periods. Annualizing a short or seasonal interval can exaggerate its significance.
Methodology maintained by ClarityKit. How these tools are built and checked.