What Is the Revenue Growth Rate?
The revenue growth rate measures how much a company's revenue has increased or decreased from one period to the next, expressed as a percentage. It is one of the most widely tracked metrics in business, finance, and investing because it reveals momentum: a rising rate signals expansion, while a falling or negative rate may flag trouble. This calculator works for any period — month over month, quarter over quarter, or year over year.
How to Use This Calculator
Enter your current period revenue and your prior period revenue, then read the growth rate as a percentage. The calculator also shows the absolute change in dollars (or any currency) so you can see both the relative and raw movement at a glance.
The Formula Explained
The growth rate is computed as:
$$\text{Growth Rate} = \frac{\text{Current Revenue} - \text{Prior Revenue}}{\text{Prior Revenue}} \times 100\%$$
First subtract the prior revenue from the current revenue to get the absolute change. Then divide that change by the prior revenue to express it relative to where you started, and multiply by 100 to convert to a percentage. A positive result means growth; a negative result means decline.
Worked Example
Suppose your business earned $100,000 last quarter and $120,000 this quarter. The change is \(\$120{,}000 - \$100{,}000 = \$20{,}000\). Dividing by the prior revenue gives \(\$20{,}000 \div \$100{,}000 = 0.20\), and multiplying by 100 yields a 20% growth rate. Your revenue grew by one-fifth period over period.
FAQ
What is a good revenue growth rate? It varies by industry and stage. Early-stage startups may target 100%+ annually, while mature companies often see single-digit growth. Compare against your own history and competitors.
Can the growth rate be negative? Yes. If current revenue is lower than the prior period, the rate is negative, indicating a decline.
Is this the same as CAGR? No. This is a simple single-period growth rate. CAGR (compound annual growth rate) averages growth across multiple periods using a compounding formula.
