ROAS Calculator
Enter your ad spend and the revenue it drove. Instantly see your return on ad spend — and the break-even ROAS your margins require.
What is ROAS?
Return on ad spend (ROAS) measures how efficiently your advertising turns dollars into revenue: one dollar of ad spend produced how many dollars of sales? Media buyers live by it because it isolates the channel — unlike ROI, which weighs every cost the business carries.
Example. You spend $5,000 on Google Ads and it drives $20,000 in attributed revenue. ROAS is $20,000 ÷ $5,000 = 4.0x, usually written as 400%. Every ad dollar returned four dollars of revenue.
The number that actually matters: break-even ROAS
Raw ROAS is flattering because it ignores cost of goods sold. The break-even ROAS corrects for that — it is the ROAS at which your gross profit exactly covers your ad spend:
With a 50% gross margin, break-even ROAS is 2.0x: at 2.0x you cover COGS and media; everything above 2.0x is real profit. With a 20% margin, break-even is 5.0x — and a 4.0x ROAS that looks healthy is actually losing money. Always judge ROAS against your break-even line, not someone else's benchmark.
ROAS vs ROI
ROAS answers "did the channel work?" — ROI answers "did the business make money?" A 400% ROAS can coexist with a negative ROI if margins are thin or overhead is heavy. Use ROAS to manage campaigns day to day, and our ROI calculator to check whether those campaigns were worth running at all.
Common mistakes
- Comparing ROAS across different margins. A brand with 70% margins and one with 25% are playing different games — only break-even ROAS makes them comparable.
- Forgetting attribution gaps. Platform-reported revenue often over-counts. Cross-check with your actual order data before scaling a "winning" campaign.
- Optimizing to ROAS alone. Cutting spend usually lifts ROAS while shrinking profit. ROAS is an efficiency metric; profit is the goal.
Frequently asked questions
What is a good ROAS?
There is no universal target — it depends on your margins. With a 50% gross margin, any ROAS above 2.0x makes money; with a 20% margin you need 5.0x just to break even. As a rough rule, ecommerce brands often aim for 4.0x+, but the only number that matters is your break-even ROAS.
How do I calculate break-even ROAS?
Divide 1 by your gross margin (as a decimal): Break-even ROAS = 1 ÷ gross margin. A 60% margin gives 1 ÷ 0.60 = 1.67x. At exactly that ROAS your ads cover their own cost and your cost of goods sold — anything above it is profit.
Why is my ROAS high but my profit low?
ROAS ignores everything except ad spend: product costs, shipping, refunds, agency fees and overhead are all invisible to it. A 400% ROAS on a low-margin product can still lose money. Compare ROAS against your break-even ROAS, and sanity-check with full ROI that includes all costs.
What is the difference between ROAS and ROI?
ROAS measures revenue relative to ad spend only: Revenue ÷ Ad Spend. ROI measures profit relative to total cost: (Revenue − All Costs) ÷ All Costs. ROAS is a channel-efficiency metric; ROI tells you whether the business actually made money. Our ROI calculator includes all costs, so the two complement each other.
Should I include agency fees and creative costs in ROAS?
Strictly, no — those belong in ROI. But if you want a "blended" ROAS that reflects reality, add fees and creative to the ad spend line and watch it drop. Many teams track both: platform ROAS for media buyers, blended ROAS for the P&L owner.