Lifetime Value (LTV) is the total revenue an app expects to earn from a user over the whole relationship, and it caps what a team can afford to pay to acquire that user.
LTV combines how much a user spends with how long they stay. For a subscription app it's roughly revenue per paying user per period, times the share of installs who pay, times the expected number of periods retained, net of the store's commission and taxes if you model proceeds. It's a forecast, not a measurement: young cohorts have little history, so many teams use a capped horizon such as 12- or 24-month LTV and revise it as real renewals arrive. App Store Connect Analytics offers cohorts by download date and download source, plus a proceeds-per-download peer benchmark, a first-party starting point on iOS.
LTV caps acquisition spend: if a user is worth $12 over a year, paying $15 per install loses money however good the funnel looks, so the LTV:CAC ratio decides how hard paid channels can be pushed. ASO changes that equation in two ways. Organic installs carry no acquisition cost, so they pull blended CAC down and raise blended LTV:CAC; and a listing that sets accurate expectations tends to attract users who stay, which lifts LTV itself. Estimate conservatively, because an inflated LTV quietly justifies unprofitable bids.
Example
A budgeting app's subscribers pay $4 a month and stay about nine months, and one in five installs subscribes, so each install is worth roughly $7.20 before commission. With paid installs costing $5, the team holds Apple Ads spend steady and invests in ASO to grow the zero-cost organic share.