ROAS Calculator
Type in what you spent on ads and the sales they brought in. See your return on ad spend, the ROAS you need to break even, and whether the ads really make you money.
What you paid the ad platform.
Sales value the ads brought in. 10k and 1.2m work too.
What's left of each sale after product and delivery costs.
Revenue ÷ number of orders. Gives the most you can pay per sale.
Share of revenue given back.
Card, PayPal or app store cut, as a % of sales.
Paid on top of the ad spend.
Net profit after ads and all costs. Gives your target ROAS.
Include the first order. More than 1 counts repeat buys.
Where the money goes
Compare campaigns
Up to 4 campaigns, judged with the margin and costs above.
How your ROAS is worked out
Revenue divided by ad spend gives ROAS. Your margin tells you the ROAS you need to break even.
- 1
Return on ad spend
$4,000 ÷ $1,000= 4× (400%)
- 2
Break-even ROAS
1 ÷ 40% margin= 2.5× to break even
- 3
Profit after costs
$4,000 × 40%− $1,000 ads= $600 profit
- 4
Most per sale
$80.00 order × 40%you pay $20.00 now= $32.00 max CPA
Read more: the formula, a worked example, ROAS vs ROI and repeat buyers
ROAS (return on ad spend) tells you how many times your ad money came back as sales. It says nothing about profit on its own: for that you need your margin, the share of each sale that's left after paying for the product. The break-even ROAS is the point where that margin exactly covers the ads.
The formula
ROAS = revenue from ads ÷ ad spend
ROAS % = ROAS × 100
break-even ROAS = 1 ÷ gross margin
profit = revenue × margin − ad spend
most you can pay per sale = average order value × margin
you pay per sale = ad spend ÷ (revenue ÷ average order value)
With refunds, payment fees and an agency fee:
kept per 1 of sales = (1 − refunds) × margin − fees
break-even ROAS = (1 + agency fee) ÷ kept per 1
ROI = profit ÷ (ad spend + agency fee)
target ROAS = (1 + agency fee) ÷ (kept per 1 − profit wanted)
break-even ROAS with repeat buys = break-even ROAS ÷ orders per customer
ad spend for a goal = revenue goal ÷ ROAS
Worked example
You spend $1,000 on ads and they bring in $4,000 of sales. ROAS = $4,000 ÷ $1,000 = 4× (400%), and revenue minus ad spend is $3,000.
Your gross margin is 40%, so break-even ROAS = 1 ÷ 0.40 = 2.5×. Your 4× is above it, so the campaign makes money: $4,000 × 40% = $1,600 of gross profit, minus $1,000 of ads = $600 profit. That's an ROI of $600 ÷ $1,000 = 60%.
The average order is $80, so the ads bought $4,000 ÷ $80 = 50 sales at $1,000 ÷ 50 = $20 each. The most you could pay per sale and still break even is $80 × 40% = $32.
For a 10% profit on sales, target ROAS = 1 ÷ (0.40 − 0.10) = 3.33× (333%), and the target cost per sale is $80 × 30% = $24. To bring in $10,000 at this campaign's 4× ROAS you'd spend $10,000 ÷ 4 = $2,500.
With refunds, fees and repeat buyers
Add 10% refunds, 3% payment fees and a 10% agency fee. You keep 0.9 × 40% − 3% = 33% of each $1 of sales, so break-even ROAS = 1.10 ÷ 0.33 = 3.33×. The same campaign now makes $4,000 × 33% − $1,100 = $220.
If each customer buys 3 times in all (with the same 40% margin and no extra costs), the first order only needs a ROAS of 2.5× ÷ 3 = 0.83× for the ads to pay off over time, and you can spend up to $80 × 3 × 40% = $96 to win a customer. That only holds if the repeat orders really happen, and the money comes back later, not now.
ROAS vs ROI at a glance
| Measure | What it counts | Example |
|---|---|---|
| ROAS | Sales per 1 of ad spend | $4,000 ÷ $1,000 = 4× |
| Break-even ROAS | ROAS where profit is zero | 1 ÷ 40% = 2.5× |
| ROI | Profit per 1 of ad cost | $600 ÷ $1,000 = 60% |
| CPA | Ad spend per sale | $1,000 ÷ 50 = $20 |
What counts as a good ROAS depends on your own margin and costs, not on an industry average: a 3× ROAS is a loss for a shop with a 25% margin (break-even 4×) and a healthy profit for one with a 60% margin (break-even 1.67×). Ad platforms count revenue in their own way (attribution windows, view-through sales), so check their numbers against your shop's own sales. This calculator treats refunded orders as returned to stock and payment fees as not refunded.
Common questions
How do you calculate ROAS?
Divide the revenue your ads brought in by what you spent on them. $4,000 of sales from $1,000 of ads is a ROAS of 4,000 ÷ 1,000 = 4×, also written 4:1 or 400%. It means every $1 of ads brought back $4 of sales.
What is break-even ROAS?
The ROAS at which the profit from your sales just pays for the ads. It is 1 ÷ your gross margin. If 40% of each sale is left after product and delivery costs, break-even ROAS is 1 ÷ 0.40 = 2.5×. Below 2.5× the ads lose money; above it they make money.
What is the difference between ROAS and ROI?
ROAS counts revenue, ROI counts profit. A 4× ROAS on $1,000 means $4,000 of sales. With a 40% margin that is $1,600 of gross profit, so after the $1,000 of ads you keep $600: an ROI of 600 ÷ 1,000 = 60%. A campaign can have a ROAS above 1× and still lose money.
How do I work out a target ROAS?
Take your margin, subtract the profit you want as a share of sales, and divide 1 by what is left. With a 40% margin and a 10% profit goal: 1 ÷ (0.40 − 0.10) = 3.33×. This is the number to put in a "target ROAS" bid setting, as a percentage (333%) on platforms that ask for one.
What is the most I can pay to get a sale?
Your average order value times your margin. An $80 order with a 40% margin leaves $32, so you can pay up to $32 in ads per sale (your break-even CPA). If customers come back and buy again, the lifetime profit per customer is what you can afford instead: 3 orders × $32 = $96.
Do refunds and payment fees change break-even ROAS?
Yes. Refunds take back revenue and payment fees take a slice of every sale, so less is left to pay for ads. With a 40% margin, 10% refunds and 3% fees, you keep 0.9 × 40% − 3% = 33% of revenue, and break-even ROAS rises from 2.5× to 1 ÷ 0.33 = 3.03×.
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