CAGR Calculator
Enter a beginning value, an ending value, and the number of years between them to calculate the CAGR — the smoothed annual growth rate that would take you from the start to the end if growth were perfectly even each year. The result tells you the equivalent constant annual rate of return.
CAGR is the standard metric for comparing investment performance, revenue growth, user growth, and any other metric that changes over multiple years. Unlike a simple average of year-over-year growth rates, CAGR accounts for the compounding effect and gives a single, clean number that represents the overall trajectory.
The formula is CAGR = ((Ending Value / Beginning Value) ^ (1 / Years) - 1) x 100. This tool shows the result as a percentage and also displays what the beginning value would grow to at that CAGR over each year of the period.
By The Paper Room Editorial Team — Calculator Tools
Frequently asked questions
What does CAGR stand for?▼
CAGR stands for Compound Annual Growth Rate. It is the rate of return that would be required for an investment or metric to grow from its beginning value to its ending value, assuming profits are reinvested at the end of each year.
Why is CAGR better than a simple average growth rate?▼
A simple average of annual growth rates ignores compounding and can be misleading. For example, if an investment doubles one year (+100%) and halves the next (-50%), the simple average is +25%, but the actual value is back where it started (0% real growth). CAGR correctly reports 0%.
Can CAGR be negative?▼
Yes. If the ending value is lower than the beginning value, the CAGR will be negative, indicating an average annual decline over the period.