What is CAGR?
Compound annual growth rate: the steady yearly growth that would take the starting value to the ending value over the period. It smooths out the ups and downs between the two.
Growth Rate (CAGR) Calculator
Average yearly growth.
Enter start, end and years.
A smoothed rate; the real path may have been bumpy.
How it is worked out
- CAGR = (ending ÷ starting)^(1 ÷ years) − 1
- Total growth = ending ÷ starting − 1
Example: Sales that grow from 10,000 to 19,000 in 3 years have a CAGR of 23.86%: 90% growth in total, compounded.
About the Growth Rate (CAGR) Calculator
The steady yearly growth rate between two values: sales, revenue, an investment or anything else.
How to use this tool
- Enter the starting value and the ending value.
- Enter the years between them. 18 months is 1.5.
- Read the yearly growth rate and the year-by-year path.
Frequently asked questions
How is it calculated?
CAGR = (ending value ÷ starting value)^(1 ÷ years) − 1. Growing from 10,000 to 19,000 over 3 years is a CAGR of 23.86%.
Why not just average the yearly growth?
Averages overstate it. 100 rising to 150 and falling back to 100 is +50% then −33.33%, an average of +8.33% a year, yet nothing grew: the CAGR is 0.00%.
Can CAGR be negative?
Yes. If the ending value is lower than the starting value, CAGR shows the steady yearly decline. It cannot be worked out from a starting value of zero.