Annual Contract Value (ACV)
Annual Contract Value (ACV)
Definition: ACV is the average annualized revenue per customer contract, excluding one-time fees.
How It’s Used:
Measures the value of customer contracts for SaaS and subscription businesses.
Useful for sales forecasting and performance benchmarking.
Formula:
ACV = Total Contract Value / Number of Years
Example: A 3-year contract worth $60,000 has an ACV of $20,000.
Last updated
Was this helpful?