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ROAS calculator with break-even ROAS
Enter your ad spend, the revenue those ads brought in and your profit margin. You get your ROAS, the ROAS you need to break even, and your real profit after ad costs.
How to calculate ROAS
ROAS = revenue from ads ÷ ad spend. If you spend $500 on ads and those ads bring in $1,800 in sales, your ROAS is 3.6x: every $1 of ads returned $3.60 in sales.
Break-even ROAS: the number that matters
Break-even ROAS = 1 ÷ profit margin before ad costs. With a 40% margin, break-even ROAS is 2.5x. Below that, every sale from ads loses money; above it, ads are profitable.
| Profit margin before ads | Break-even ROAS |
|---|---|
| 20% | 5.0x |
| 30% | 3.33x |
| 40% | 2.5x |
| 50% | 2.0x |
| 70% | 1.43x |
| 90% (digital products) | 1.11x |
Questions marketers ask
What is a good ROAS?
A good ROAS is any ROAS above your break-even ROAS. With a 40% profit margin, break-even is 2.5x, so a 3x ROAS is profitable while a 2x ROAS loses money.
How do you calculate break-even ROAS?
Break-even ROAS = 1 ÷ your profit margin before ad costs. A 25% margin needs 4x, a 50% margin needs 2x.
Is ROAS the same as ROI?
No. ROAS compares ad revenue with ad spend only. ROI also counts product costs and other expenses, which is why you need your margin to know if ads are profitable.