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Ads and campaigns
ROAS and break-even calculator
Find out whether your ads make money, not just revenue. Enter spend, revenue, and your margin to see your ROAS, where break-even sits, the profit left after ad spend, and the ROAS to aim for to hit your profit goal.
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- No sign-up
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Three steps
How it works
Enter ad spend, and either revenue or orders and order value.
Add your gross margin, plus any fees, to see break-even and profit.
Read each result with its formula, then copy the results or a link.
GuideReviewed
How to tell whether your ads are profitable
Contents
ROAS, and what it leaves out
Return on ad spend (ROAS) is revenue ÷ ad spend. A campaign that spent $4,000 and brought in $14,400 has a ROAS of 3.6, often written 3.6× or 360%. Google Ads uses the same idea for target ROAS: $5 in sales for every $1 of ad spend is a 500% target.
ROAS counts revenue, not profit. It ignores what your products cost to make and deliver, so a ROAS that looks healthy can still lose money.
Break-even comes from your margin
Gross margin is the share of each sale left after the cost of making and delivering it. At a 55% margin, each $1 of revenue leaves 55 cents to pay for ads, so ads break even at about $1.82 of revenue per $1 spent. Below that they lose money; above it they add profit.
- Break-even ROAS = 1 ÷ gross margin.
- Break-even cost per order (CPA) = average order value × gross margin. It’s the most you can pay to win one order.
- Profit after ad spend = revenue × gross margin − ad spend.
- Target ROAS for a profit goal = 1 ÷ (gross margin − the profit margin you want). At a 55% margin and a 15% goal, aim for 2.5×.
ROAS vs ROI
ROI on ad spend divides the profit by what the ads cost, so it shows what you earned beyond getting your money back. In the example, $3,920 of profit on $4,000 of ad spend is a 98% ROI, while the ROAS is 3.6×. ROAS is handy for steering campaigns day to day; ROI tells you whether they were worth it.
Fees, and which numbers to use
Fees charged on your ad spend, such as an agency’s percentage, raise what each ad dollar really costs. Fees charged on each sale, such as payment processing or marketplace fees, shrink what the sale leaves. Add either kind as a percentage and the calculator accounts for it.
Use the same revenue you report on, and a gross margin after the cost of goods and delivery. Without a margin, you’ll still see ROAS and cost per order, but not break-even or profit.
Frequently asked
Questions, answered.
What people ask before they use the ROAS and break-even calculator.
Divide the revenue your ads brought in by what you spent on them. $14,400 of revenue from $4,000 of ad spend is a ROAS of 3.6, or 360%.
The ROAS at which ads pay for themselves and nothing more. It’s 1 divided by your gross margin, so at a 55% margin, break-even ROAS is about 1.82. Anything above it adds profit.
One above your break-even ROAS, with room for the profit you want. Because margins differ so much between businesses, a fixed figure means little on its own. This calculator works out your break-even and the target for your profit goal.
ROAS compares revenue with ad spend. ROI compares profit with ad spend, so it accounts for your margin. A campaign can have a ROAS above 1 and still lose money.
You’ll still see ROAS and cost per order. Break-even, profit, and target ROAS need a gross margin, so ask your finance lead or estimate it from your pricing and costs, and say it’s an estimate when you share the results.
No. It changes the symbol only, so enter every amount in the same currency. Everything runs in your browser, and a copied link holds the numbers you entered, so anyone you send it to sees them.
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From Ampere
The math sets what an ad has to earn. The creative earns it.
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