Net Present Value (NPV) Calculator

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Net Present Value (NPV) represents the difference between the present value of future cash flows and the initial investment. A positive NPV indicates that the investment is expected to generate value. More info →

Input

Initial Investment

Discount Rate (%)

Cash Flow Timing

Cash Flow Type

Variable Cash Flows

Enter investment details to calculate NPV.

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How This Calculator Works

NPV tells you how much value an investment adds in today's money. The calculator discounts every future cash flow back to the present at your discount rate, adds them up, and subtracts the initial investment. A positive result means the investment earns more than your required rate of return.

The Formula

NPV = ∑ CF_t / (1 + r)^t − Initial Investment

CF_t = cash flow in period t · r = discount rate · t = period number

What Each Input Does

Initial Investment: The upfront cost paid today (period 0). It is not discounted and is subtracted in full.
Discount Rate (%): Your required return or cost of capital. A higher rate shrinks the value of future cash flows and lowers NPV.
Cash Flow Timing: End of period – the first cash flow is discounted one full period.
Beginning of period – the first cash flow arrives today and is not discounted, so NPV is higher.
Date-based (XNPV) – each cash flow is discounted by the exact number of days from the investment date (days ÷ 365).
Cash Flow Type: Fixed – the same amount repeated for the number of periods you enter.
Variable – enter a different amount for each period, in order.

Step by Step

Each cash flow is divided by (1 + r) raised to its period number to get its present value.
All the present values are added together.
The initial investment is subtracted to give the NPV.
The result is rounded to 2 decimals and interpreted below.

Reading the Result

Positive – adds value, generally accept.

Negative – destroys value, generally reject.

Zero – break-even at your discount rate.

Quick Example

Initial investment 100,000, discount rate 10%, fixed cash flow of 30,000 for 5 periods at the end of each period. The present value of the five cash flows is 113,723.60, so NPV = 113,723.60 − 100,000 = 13,723.60, a positive result. With beginning-of-period timing, the same inputs give an NPV of 25,095.96.