Month-over-Month Growth
The percentage change in a metric from one period to the next.
Formula
Variables
Example
$120k / $100k − 1 = 20% growth
How it works
This formula compares a current value to the immediately preceding value by expressing the change as a fraction of the previous period. Subtracting 1 removes the original baseline, so the result measures how much the metric has grown or shrunk relative to where it started. A positive value means increase, a negative value means decline, and multiplying by 100 converts the decimal into a percentage.
When to use it
Use this when you want to track short-term momentum in business metrics such as revenue, user sign-ups, website traffic, or subscription churn from one month to the next. It is especially useful for spotting acceleration, seasonality, or sudden drops in performance.
Worked example, step by step
Previous month revenue, V_0 = $84,000 Current month revenue, V_1 = $91,560 Substitute into the formula: g = (V_1 / V_0) - 1 Compute the ratio: g = (91,560 / 84,000) - 1 g = 1.09 - 1 g = 0.09 Convert to a percentage: 0.09 × 100 = 9% Final answer: month-over-month growth = 9%
Common mistakes to avoid
- Using the current value as the denominator instead of the previous value
- Forgetting to subtract 1 before converting to a percentage
- Calling it growth when the result is negative, which actually indicates a decline
Did You Know?
Sustained 20% month-over-month growth compounds to nearly 9× over a single year.
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