NPV Calculator

Net present value and internal rate of return, in seconds.

Usually negative, e.g. -1,000. Tap ± to switch the sign.

Your required return. Left empty, 8% is used.

YearCash flow
Year 1
Year 2
Year 3
Year 4
Year 5

Empty cells count as 0.

How it works

Money today is worth more than the same amount later. Net present value brings every future cash flow back to today's terms using a discount rate — your required return — and adds them up with the initial investment.

NPV = CF₀ + Σ CFₜ ÷ (1 + r)ᵗ

With year-by-year rates, each year's cash flow is discounted at its own rate: CFₜ ÷ (1 + rₜ)ᵗ. The internal rate of return is the single rate that makes NPV exactly zero — a project's break-even return.

0 = CF₀ + Σ CFₜ ÷ (1 + IRR)ᵗ

Questions

What is NPV?
The value today of all a project's cash flows, after discounting. A positive NPV means it earns more than your discount rate.
What is IRR?
The discount rate at which NPV equals zero. If the IRR is higher than your required return, the project is generally worth considering.
Why can IRR be undefined?
If all cash flows share the same sign, no rate can bring NPV to zero. Unusual patterns can also have no solution — or several.

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