RETURN ON AD SPEND

ROAS Calculator

Calculate return on ad spend from advertising cost, attributed revenue, and gross margin, including break-even ROAS and profit after the ad spend.

What ROAS measures

ROAS is attributed revenue divided by ad spend. A 4× ROAS is also 400% of spend. It is a revenue multiple, not net profit. Gross margin turns that revenue into the profit available to pay for ads.

ROAS = attributed revenue ÷ ad spend
Gross profit from ads = attributed revenue × gross margin
Profit after ad spend = gross profit − ad spend
Break-even ROAS = 1 ÷ gross margin

Example

$5,000 of ad spend and $20,000 of attributed revenue is a 4× ROAS. At a 40% gross margin, ad revenue produces $8,000 of gross profit and $3,000 after the ad spend. Break-even ROAS is 2.5×.

Attribution still sits outside the formula

Platform windows, view-through credit, and overlapping campaigns can change the revenue number. Salaries, creative production, refunds, shipping, and overhead are not subtracted here.

Frequently asked questions

Does 400% ROAS mean a 4× profit?

No. It means revenue is four times ad spend, before product cost and other expenses.

Does a higher margin lower break-even ROAS?

Yes. More of each revenue dollar is available to cover ad spend.

Can I calculate ROAS with $0 spend?

Gross profit can still be shown. ROAS is undefined when spend is zero.

Can I compare two ad platforms?

Only after the attribution window, conversion event, and revenue definition match.

More calculators

Gross Margin Calculator →Break-Even Calculator →ROI Calculator →

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