Investors look at revenue growth alongside margins: fast growth with shrinking margins may not create value. Use CAGR to compare growth over different time spans.
How to use the Revenue Growth Calculator
- Previous period revenue
- Current period revenue
- Revenue several years ago
- Number of years between them
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the previous and current period revenue, and optionally the revenue several years ago.
Tips
- Use consistent periods (a year or a quarter) for flow figures and period-end values for balances.
- Average opening and closing balances when a ratio mixes a flow with a stock.
- Benchmark against competitors in the same industry.
- Read the ratio together with others – profitability, liquidity and efficiency tell different stories.
Common mistakes to avoid
- Using sales instead of cost of goods sold for inventory ratios.
- Mixing gross, operating and net profit.
- Ignoring one-off items that distort a single year.
Inputs explained
| Field | What to enter |
|---|---|
| Previous period revenue | Amount in your currency |
| Current period revenue | Amount in your currency |
| Revenue several years ago | Amount in your currency |
| Number of years between them | A number |
What each result means
- Revenue growth = ([Current period revenue] – [Previous period revenue])÷[Previous period revenue]×100
- Change in revenue = [Current period revenue] – [Previous period revenue]
- Compound annual growth rate = (([Current period revenue]÷[Revenue several years ago])^(1÷[Number of years between them]) – 1)×100
Example values
How the main result changes when Previous period revenue changes and everything else stays at the example values above:
| Previous period revenue | Revenue growth (%) |
|---|---|
| 1,000,000 | 140 |
| 1,500,000 | 60 |
| 2,000,000 | 20 |
| 2,500,000 | -4 |
| 3,000,000 | -20 |
| 4,000,000 | -40 |
Formula
Revenue growth = (current − previous) ÷ previous × 100CAGR = (ending ÷ beginning)^(1/years) − 1Worked example
Inputs — Previous period revenue: $2,000,000; Current period revenue: $2,400,000; Revenue several years ago: $1,200,000; Number of years between them: 4.
Results — Revenue growth = 20 %; Change in revenue = $400,000.00; Compound annual growth rate = 18.92 %.
Frequently asked questions
How do I calculate revenue growth?
(Current − previous) ÷ previous × 100.
What is a good revenue growth rate?
It depends on company size and industry; 10–20% is strong for established firms.
Why use CAGR?
It smooths out uneven yearly growth.
What formula does the Revenue Growth Calculator use?
Revenue growth = (current − previous) ÷ previous × 100.