ROAS calculator
What is left of a sale after product, shipping and fees.
ROAS
3.50x
- Revenue per $1 of ads
- $3.50
- Break-even ROAS
- 2.50x
- Profit after ad spend
- $480
Above break-even: these ads make money.
The formula
ROAS = revenue from ads ÷ ad spend
The answer is a multiple: 3.5x means every dollar of ads brought back $3.50 in revenue. Some teams write it as a percentage (350%); it is the same number.
ROAS on its own says nothing about profit, because revenue is not what you keep. To know whether the ads pay for themselves you need one more number, your gross margin: the share of each sale left after the product, shipping, packaging and payment fees. With it, the calculator adds two answers:
- Break-even ROAS = 1 ÷ margin. The ROAS at which ad spend eats exactly the margin. With a 40% margin, that is 1 ÷ 0.40 = 2.5x.
- Profit after ad spend = revenue × margin − ad spend. What the campaign left you after paying for the product and the ads.
A worked example
An online shop spent $1,200 on Meta ads last month and tracked $4,200 of revenue from them. Its products carry a 40% gross margin.
| Calculation | Result | |
|---|---|---|
| ROAS | 4,200 ÷ 1,200 | 3.5x |
| Break-even ROAS | 1 ÷ 0.40 | 2.5x |
| Gross profit from the sales | 4,200 × 0.40 | $1,680 |
| Profit after ad spend | 1,680 − 1,200 | $480 |
The campaign is above break-even, so it makes money: $480 on $1,200 of spend. If the same shop had a 25% margin, break-even would be 4x and the same 3.5x ROAS would lose $150. Same ads, same revenue, opposite answer. That is the most common mistake in reading ROAS, and the reason to always look at it next to margin.
How to read your result
- Above break-even: the ads pay for themselves on the first sale. You can usually raise the budget gradually and watch whether ROAS holds.
- Near break-even: the ads are buying customers at cost. That can still be worth it if customers come back, so compare with what a customer spends over a year.
- Below break-even: each sale loses money before repeat purchases. Fix the offer, the creative or the price before spending more.
What counts as a good ROAS for Meta ads depends on the business; our answer on what a good ROAS is for Meta ads walks through the common ranges and why they differ. If you sell many products with different margins, the break-even ROAS calculator works out the line from price and cost instead of a margin percentage.
Common mistakes
Mixing time windows. Revenue from a sale that happened after the period you measured spend for makes ROAS look higher than it was. Use the same dates for both, and keep them at least a week long.
Counting revenue the ads didn't cause. Customers who would have bought anyway, from email or a search for your name, sometimes get credited to the ad. Compare periods with and without ads when you can.
Ignoring returns. Revenue that is refunded later was never yours. Subtract returns before you divide.
Limits
ROAS is only as good as the revenue you attribute to the ads. Meta's reported purchase value uses its own attribution window and can include sales that would have happened without the ad. Ads that build awareness show a low ROAS on the day and pay off later, and a blended ROAS (all revenue ÷ all ad spend, sometimes called MER) is a useful check on platform numbers. For lead businesses with no online checkout, cost per lead is the better metric; use the CPA calculator. If you want ROAS from your real account data, the free Meta ads audit reads your last 30 days read-only.