NPV & IRR Calculator
Compute Net Present Value and Internal Rate of Return from any series of cash flows. Includes accept/reject decision rule and hurdle rate comparison.
All calculations happen in your browser. No data is sent anywhere.
Net Present Value (NPV)
Internal Rate of Return (IRR)
How It Works
Net Present Value (NPV)
NPV discounts each future cash flow back to today's value using the formula NPV = Σ CF_t / (1+r)^t. A positive NPV means the investment returns more than the cost of capital (accept); negative means destroy value (reject); zero means indifferent. The discount rate is the opportunity cost of capital — often WACC for corporate projects.
Internal Rate of Return (IRR)
IRR is the discount rate at which NPV = 0. This calculator uses Newton–Raphson iteration to converge on the solution. Accept the project if IRR exceeds the hurdle rate. IRR has limitations: it assumes reinvestment at the IRR itself, and projects with unconventional cash flows can have multiple IRRs. For these cases, prefer NPV.
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Open calculator →FAQ
What is NPV (Net Present Value)?
NPV is the sum of all cash flows discounted to the present at a given rate. Positive NPV → accept; negative NPV → reject. Formula: NPV = Σ CF_t / (1 + r)^t, where CF_t is the cash flow at period t and r is the discount rate. The discount rate is usually the weighted average cost of capital (WACC) or required return.
What is IRR (Internal Rate of Return)?
IRR is the discount rate that makes NPV = 0. It represents the annualised return on investment. Accept the project if IRR > hurdle rate (required return); reject if IRR < hurdle rate. IRR is solved iteratively — this calculator uses Newton–Raphson which typically converges in fewer than 50 iterations.
How do I enter cash flows?
Enter one cash flow per line, or separate with commas. The first value (t=0) is usually the initial investment — enter it as a negative number (e.g. -10000). Subsequent values are the net cash inflows at each period. Example: -10000, 3000, 4000, 5000, 2000.
Why does IRR fail sometimes?
IRR requires at least one sign change in the cash flow series (negative followed by positive, or vice versa). If all cash flows are the same sign, no IRR exists. Projects with multiple sign changes can have multiple IRRs — in these cases NPV is a more reliable measure. This calculator returns an error if IRR cannot be found.