A forecast of the net profit associated with a customer’s entire future relationship. Follow these procedures to determine LTV for a specific time period:

Take the revenue you received from the customer during that time period.
Subtract the gross margin from that figure.
Divide by the customer’s projected turnover rate (also known as cancellation rate).
For instance, if a client pays you $100,000 per year and your revenue gross margin is 70%, and that customer type is expected to cancel at a rate of 16% per year, the customer’s LTV is $437,500.