Quick answer
ARPPU (average revenue per paying user) is total revenue in a period divided by the number of users who made a payment in that period. Multiplied by the payer conversion rate, it equals ARPU.
Formula: ARPPU = revenue ÷ paying users
What is ARPPU?
ARPPU (average revenue per paying user) is the revenue in a period divided by the number of users who paid during that period. It shows how much a typical paying customer spends, ignoring everyone who did not pay.
ARPPU = revenue in the period ÷ paying users in the periodARPPU is most common in mobile games, freemium apps and marketplaces, where the majority of users never pay and a small share generates almost all revenue.
ARPPU vs ARPU
ARPU divides revenue by all active users; ARPPU divides by paying users only. They are linked by the payer conversion rate:
ARPU = ARPPU × (paying users ÷ active users)| Metric | Denominator | Answers |
|---|---|---|
| ARPU | All active users | How much is an average user worth? |
| ARPPU | Paying users | How much does a payer spend? |
| Payer conversion | — | What share of users pay? |
Worked example
A freemium app in one month (sample data):
| Input | Value |
|---|---|
| Monthly active users | 60,000 |
| Paying users | 1,500 |
| Revenue | $48,000 |
- Payer conversion = 1,500 ÷ 60,000 = 2.5%
- ARPPU = $48,000 ÷ 1,500 = $32.00
- ARPU = $48,000 ÷ 60,000 = $0.80 (= $32 × 2.5%)
Now the team tests a cheaper starter pack. More people buy, but each spends less:
| Scenario | Payer conversion | ARPPU | Payers | Revenue | ARPU |
|---|---|---|---|---|---|
| Before | 2.5% | $32.00 | 1,500 | $48,000 | $0.80 |
| After starter pack | 3.0% | $28.00 | 1,800 | $50,400 | $0.84 |
ARPPU fell 12.5%, which looks bad in isolation, but revenue rose 5% because conversion rose 20%. Always read ARPPU together with payer conversion and ARPU.
What moves ARPPU
- Pricing and packaging: price points, bundles, subscription tiers.
- Mix of payers: a few big spenders ("whales") can dominate; track the median spend per payer too.
- Repeat purchases within the period.
- New payer share: first-time payers often spend less than returning ones.
- Discounts and refunds: decide whether revenue is gross or net and keep it consistent.
Common mistakes
- Mixing periods: daily ARPPU and monthly ARPPU are not comparable; a monthly payer may pay on one day only.
- Counting payments instead of payers: three purchases by one person are one paying user.
- Comparing averages with heavy tails: one whale can double ARPPU; use the median as a check.
- Ignoring platform fees: app store commissions can take a large share of gross revenue.
ARPPU in TapCub
Send purchases as revenue events with an amount and currency. Revenue reports then give revenue, paying users and ARPU; the game industry template also includes ARPPU and payer rate alongside paying user counts. Break ARPPU down by platform, country, acquisition source or app version to see where payers spend more. See revenue tracking, lifetime value and mobile app KPIs.
Sources
- Adjust. ARPPU.
- AppsFlyer. Average revenue per paying user (ARPPU).
- Unity. ARPPU.
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Data Engineer
Writes about event design, data quality, and collection workflows, with verifiable implementation methods for reliable analytics.