Free ROAS calculator

ROAS calculator

What return are your ads really making? Enter revenue and ad spend to get ROAS, then add your margin to see profit after ads and POAS.

By Trueclip Updated

Your campaign

Sales attributed to the campaign

What the campaign cost

More options

Share of revenue left after product costs

ROAS

Revenue for every $1 of ad spend

3.00×
Gross profit
$1,200
Profit after ads
$200
POAS 1.20

How ROAS is calculated

ROAS divides revenue by ad spend. Adding your margin shows whether that revenue turned into profit.

  • ROAS

    Ad revenue ÷ ad spend.

  • Gross profit

    Ad revenue × gross margin.

  • Profit after ads

    Gross profit − ad spend.

  • POAS

    Gross profit ÷ ad spend. Above 1.0 makes money.

Worked example: a $1,000 campaign
Revenue from ads
$3,000
Gross profit (40%)
$1,200
− Ad spend
$1,000
Profit after ads
$200
ROAS 3.00× · POAS 1.20. A 3× ROAS only leaves $200 here.

ROAS formula and what each number means

ROAS = revenue from ads ÷ ad spend. The same result can be written three ways.

ROASRevenue per $1 of adsACoS and break-even margin
1×$1.00 back per $1 · 100%100% ACoS · breaks even at 100% margin
2×$2.00 back per $1 · 200%50% ACoS · breaks even at 50% margin
2.5×$2.50 back per $1 · 250%40% ACoS · breaks even at 40% margin
3×$3.00 back per $1 · 300%33% ACoS · breaks even at 33% margin
4×$4.00 back per $1 · 400%25% ACoS · breaks even at 25% margin
5×$5.00 back per $1 · 500%20% ACoS · breaks even at 20% margin

Break-even margin is the contribution margin at which that ROAS makes zero profit. Find yours with the break-even ROAS calculator.

What is a good ROAS?

There's no universal number. A good ROAS is one above the break-even ROAS for your margin.

Your marginBreak-even ROASAt 2.5× ROAS
25% margin4.00×A 2.5× ROAS loses money
33% margin3.03×A 2.5× ROAS loses money
40% margin2.50×A 2.5× ROAS is profitable
50% margin2.00×A 2.5× ROAS is profitable
60% margin1.67×A 2.5× ROAS is profitable

ROAS, POAS and MER

Three ways to judge the same ad spend. Use them together.

MetricFormulaWhat it tells you
ROASAd revenue ÷ ad spendWhich campaign earns the most per dollar
POASGross profit from ads ÷ ad spendWhether the ads actually made money
MERTotal revenue ÷ total ad spendOverall efficiency, no attribution debates

How to improve ROAS

Either get more revenue from each click or pay less for it.

  • Test new creative

    Creative is usually the biggest lever on click-through and conversion.

  • Raise order value

    Bundles and thresholds grow revenue per purchase.

  • Cut wasted spend

    Pause audiences and placements that never convert.

Common ROAS mistakes

Most bad budget calls come from reading ROAS without context.

  • Treating revenue as profit

    A strong ROAS can still lose money on a low-margin product.

  • Adding up platform ROAS

    Channels often claim the same order. Check against store revenue.

  • Judging too early

    A day or two of data swings wildly. Wait for enough orders.

  • Ignoring returns

    Refunded orders still count as revenue in most ad dashboards.

  • Mixing new and returning buyers

    Retargeting looks great because many would have bought anyway.

  • Comparing across products

    Different margins need different ROAS targets.

FAQ

Questions.

How do you calculate ROAS?

Divide the revenue from your ads by what you spent on them. $3,000 in sales from $1,000 of ad spend is a ROAS of 3, often written 3× or 300%.

What is a good ROAS?

It depends on your margin. A good ROAS is one above your break-even ROAS, which is 1 divided by your contribution margin. Use the break-even ROAS calculator to find your number.

What is the difference between ROAS and ROI?

ROAS compares revenue to ad spend only. ROI compares profit to the total investment, including product and other costs. A campaign can have a high ROAS and still lose money.

What is POAS?

Profit on ad spend: the gross profit from ad-driven orders divided by ad spend. A POAS of 1.0 means the ads exactly paid for themselves; above 1.0 they made money.

Should I use platform ROAS or my store's numbers?

Both. Ad platforms attribute sales with their own models and windows, so their ROAS often differs from what your store records. Track store revenue against total spend (MER) alongside it.

Is ROAS the same as return on investment for my business?

No. ROAS ignores product cost, shipping, fees, returns and fixed costs. Add your gross margin in the calculator to see profit after ads, which is closer to what you keep.

Is a 2.5 ROAS good?

It is good if your contribution margin is above 40%. A 2.5 ROAS breaks even at exactly a 40% margin, so a store with a 50% margin makes money at 2.5 while a store with a 30% margin loses money.

What does a 4:1 ROAS mean?

You get $4 in revenue for every $1 spent on ads, the same as a 4× or 400% ROAS. Whether that is profitable depends on how much of the $4 is left after product, shipping and fees.

Is a 5× ROAS good?

For most ecommerce margins, yes: 5× breaks even at a 20% contribution margin, so anything above that margin is profitable. Very high ROAS on small budgets can also mean you are under-spending on a campaign that could scale.

What ROAS is 25% ACoS?

4× ROAS. ACoS (advertising cost of sales, used on Amazon) is ad spend divided by revenue, the inverse of ROAS. 25% ACoS = 1 ÷ 0.25 = 4× ROAS; 50% ACoS = 2× ROAS.

How do I calculate ROAS in Excel or Google Sheets?

Put revenue in one cell and ad spend in another, then divide: =B2/C2 for ROAS as a multiple, or =B2/C2*100 for a percentage. Add a margin column and =B2*D2-C2 to get profit after ads.

What is target ROAS?

The ROAS you aim for so that ads cover their cost and leave your profit goal. It equals 1 ÷ (contribution margin − target profit margin). Ad platforms also use 'target ROAS' as a bidding strategy that aims for a set return.

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