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Finance & business

CAGR calculator: compound annual growth rate

Measure compound annual growth over a chosen period, including total return and absolute change.

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Annual CAGR—
Total return—
Absolute change—

CAGR = (final value / initial value)^(1 / duration) − 1

Why use this tool?

CAGR converts a multi-year change into a comparable compound annual growth rate. It is useful for comparing investments, revenue or metrics measured over different periods.

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Calculate and compare financial scenarios with clear indicators and explicit formulas.

Supported formats

Amounts, rates, terms and financial assumptions depending on the calculator.

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Fonctionnement

How does this tool work?

The calculation starts with the ratio between the ending value and the starting value, then applies a root based on the number of years in the period. The result is the constant annual rate that would have produced the same total change with compounding. It does not reproduce the actual year-by-year path, but it gives a practical compounded average for comparing periods of different lengths.

Use cases

Compare investments

Put returns earned over different holding periods onto the same compounded annual basis.

Track revenue growth

Measure annualized progress between two fiscal years without confusing total growth with yearly growth.

Analyze audience growth

Compare traffic, subscribers or another metric across multi-year periods using one annual rate.

Guide

How to use this tool

  1. 1

    Enter the values

    Provide the starting value and the ending value.

  2. 2

    Enter the duration

    Set the number of years between both values.

  3. 3

    Read the annualized rate

    CAGR, total return and absolute change update automatically.

Tips and best practices

  • Use values measured at comparable dates.
  • Keep the same unit for the starting and ending values.
  • Pair CAGR with yearly data when volatility matters.

Frequently asked questions

Is CAGR the same as ROI?

No. ROI measures the total return over the whole period, while CAGR expresses that evolution as an equivalent compounded annual rate.

Does CAGR mean growth was steady?

No. It is an equivalent annual rate only; the actual yearly changes may have varied substantially between the start and end dates.

Can the duration be decimal?

Yes. A duration such as 2.5 years is valid when it accurately represents the period covered by the starting and ending values.

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