NPV Calculator
Calculate the net present value of an investment's future cash flows.
This tool runs entirely in your browser. Your files are never uploaded to a server.
| Year | Cash flow | |
|---|---|---|
| 1 | ||
| 2 | ||
| 3 |
Cash flows are assumed to arrive at the end of each year after the initial investment, all discounted at one constant rate.
176.29
Net present value (NPV)
Positive NPV — this investment adds value.
What this calculator does
Discounts a series of yearly cash flows back to today at one constant rate, subtracts the initial investment, and reports the net present value (NPV) — an estimate of the value a project adds or destroys at that rate.
How to use it
Enter the initial investment made today, a discount rate, and one cash flow amount for each following year (add or remove rows as needed; each flow is assumed to land at the end of its year). Use one currency and one consistent time period throughout.
Worked example
With a 10,000 initial investment, cash flows of 3,000, 4,000 and 5,000 in years one through three, and an 8% discount rate, NPV is 3,000/1.08 + 4,000/1.08² + 5,000/1.08³ − 10,000 ≈ 176.29. Automated tests verify this figure, and the discount rate at which this same series' NPV reaches exactly zero is about 8.90%.
Formula
NPV = Σ CFₜ ÷ (1 + r)ᵗ − initial investment, summed over each entered year t at discount rate r. A higher rate shrinks the present value of later cash flows more than earlier ones, since the exponent grows with time.
Choosing a discount rate
A common choice is your cost of capital, a required rate of return, or a rate reflecting the investment's risk — riskier or longer-dated projects typically use a higher rate. This tool does not derive a rate for you; changing it changes the result, sometimes flipping the sign.
What NPV does not capture
The model assumes the entered cash flows and one constant rate are already your best estimate; it does not forecast revenue, account for taxes, inflation, financing costs, currency risk, or the chance that a later cash flow does not materialize. Small changes in early-year assumptions can move the result more than similar changes further out.
Interpretation, sources and privacy
This is an educational estimate, not investment, tax or accounting advice. The formula and discount-rate framing follow standard corporate-finance treatment as presented in Aswath Damodaran's valuation materials (NYU Stern). Reviewed September 2026. Calculation runs locally in the browser; Quiklio does not upload the entered values.
Frequently Asked Questions
- Why does raising the discount rate lower the NPV?
- Each future cash flow is divided by (1 + rate) raised to the power of its year, so a higher rate shrinks every future amount, and shrinks later years more than earlier ones — this can turn a positive NPV negative without any change to the cash flows themselves.
- Can I model a cash inflow in year zero, like a grant received today?
- Enter it by adjusting the initial investment field, since the model treats time zero as a single net outflow; the year-by-year rows are assumed to start at the end of year one.
- How is this different from the IRR calculator?
- NPV reports a currency amount of value created at a discount rate you choose; IRR instead solves for the rate at which that same series' NPV would equal exactly zero — they share the same cash-flow model but answer different questions.