What is Average Revenue Per Paying User (ARPPU)?

ARPPU is the average revenue generated only by users who have made at least one purchase in your app.

For example, if 100 users paid a total of $1,000, your ARPPU is $10, regardless of how many total users you have. It isolates monetization performance within the paying segment, making it more precise than ARPU when evaluating purchase behavior.

How does it work?

The formula is:

ARPPU = Total revenue ÷ Number of paying users

Paying users can come from:

• Subscriptions
  
  

• One-time purchases
  
  

• In-app purchases (IAP)
  
  

• Lifetime unlocks or bundles
  
  
  

ARPPU is usually measured monthly or over a specific cohort, and segmented by platform, country, or acquisition channel.

For example:

• iOS users might have a higher ARPPU than Android users
  
  

• Organic users might convert less, but those who do spend more
  
  
  

Why it matters

ARPPU helps you:

• Understand the spending behavior of your monetizing users
  
  

• Evaluate price sensitivity and optimize pricing strategy
  
  

• Compare the performance of different paywall experiments
  
  

• Forecast revenue more accurately from projected paying users
  
  

• Identify high-value cohorts worth retargeting or retaining
  
  

If ARPU tells you how much a user is worth on average, ARPPU tells you how valuable your buyers really are.

It’s a crucial metric for any app with freemium or subscription models, especially when CAC is rising and you need to monetize more efficiently.