ROAS calculator
Find out what your ads really return. Get your return on ad spend (ROAS) in × and %, the break-even ROAS your margin needs, the profit left after ad spend and agency fees, and what it takes to reach a target ROAS. Compare Google, Meta and other channels side by side. Free, no sign-up, nothing leaves your browser.
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The formulas
How to calculate ROAS
Return on ad spend (ROAS) is the revenue your ads brought in divided by what you paid for them.
A ROAS of 4× (or 400%) means every $1 of ad spend brought $4 of revenue. Google Ads uses the percentage form for its Target ROAS bid strategy: $5 of sales for each $1 of ad spend is a 500% target ROAS.
Use the same period and the same campaigns for both numbers. Revenue is what the ad platform or your analytics credit to the ads, so it depends on the attribution model: a 7-day click window and a 28-day one give different ROAS for the same month.
ROAS is not profit
ROAS compares revenue with ad spend only. It ignores what the products cost you, so the same 3× can be a good result for a software company and a loss for a shop with thin margins. To see profit, add your gross margin.
4×
$20,000 ÷ $5,000 = 4× (400%)
$4 of revenue for every $1 of ad spend.
2.5×
1 ÷ 40% = 2.5×
3× once the $1,000 agency fee is counted.
$2,000
$8,000 − $5,000 − $1,000 = $2,000
Gross profit minus ad spend and the agency fee.
Profit
Break-even ROAS: the number that tells you if ads pay
Break-even ROAS is the ROAS at which the gross profit from ad-driven sales exactly covers the ad spend.
Gross margin is revenue minus the variable costs of each sale, as a share of revenue. Shopify's guide counts the cost of goods, shipping and packaging, payment processing fees and pick-and-pack fees, and leaves fixed costs such as rent and salaries out. A $100 product with $60 of such costs has a 40% margin and a break-even ROAS of 2.5.
| Gross margin | Break-even ROAS | Ad spend allowed per $100 of revenue |
|---|---|---|
| 20% | 5× (500%) | $20 |
| 30% | 3.33× (333%) | $30 |
| 40% | 2.5× (250%) | $40 |
| 50% | 2× (200%) | $50 |
| 60% | 1.67× (167%) | $60 |
| 80% | 1.25× (125%) | $80 |
A higher ROAS can still lose money
Amazon Ads shows this with two advertisers who each spend $1,000. Advertiser A gets a 3× ROAS on a 20% margin: $3,000 of revenue, $600 of gross profit, a $400 loss. Advertiser B gets only 2× on a 60% margin: $2,000 of revenue, $1,200 of gross profit, a $200 profit. Compare ROAS with your own break-even, not with someone else's ROAS.
Count the other campaign costs
Agency fees, creative production and ad tools are paid because of the ads too. With them, break-even ROAS = (ad spend + other costs) ÷ (ad spend × margin). In the example below a $1,000 fee on $5,000 of ad spend lifts break-even from 2.5× to 3×.
POAS
Profit on ad spend (POAS) divides gross profit, not revenue, by ad spend. Above 1, the ads earn more gross profit than they cost; it is the same test as ROAS against break-even, in one number.
Planning
How to set a target ROAS
A target ROAS is break-even plus the profit you want to keep.
With a 40% margin and a goal of keeping 10% of revenue as profit after ad spend, the target is 1 ÷ (0.40 − 0.10) = 3.33×. Asking for 15% gives 1 ÷ 0.25 = 4×.
Google defines target ROAS as the average conversion value you want for each dollar spent on ads, and bids for it automatically. Its help page asks for conversion values on your conversions and, for Search and Shopping campaigns, at least 15 conversions in the past 30 days. Below that, a manual target from this page is still useful for deciding budgets, but the bid strategy has little data to learn from.
Do not set the target too high. A target far above your current ROAS usually cuts volume: the platform shows ads only where it expects that return. A lower ROAS on more sales can leave more profit in total, as long as it stays above break-even.
Worked example
One month of paid ads, step by step
An illustrative online shop, not real data. Its gross margin is 40% and its target ROAS is 5×.
In one month the shop spent $5,000 on ads and paid its agency $1,000. The ads brought 125 orders at an average of $160.
1. Revenue: 125 × 160 = $20,000
2. ROAS: 20,000 ÷ 5,000 = 4× (400%); ad spend is 25% of revenue
3. Cost per order: 5,000 ÷ 125 = $40
4. Gross profit: 20,000 × 40% = $8,000
5. Break-even ROAS: 1 ÷ 0.40 = 2.5×; with the fee (5,000 + 1,000) ÷ (5,000 × 0.40) = 3×
6. Profit after ad costs: 8,000 − 5,000 − 1,000 = $2,000; POAS 8,000 ÷ 5,000 = 1.6×
7. Break-even cost per order: 160 × 40% = $64; the shop pays $40
8. Against the 5× target: revenue needed 5 × 5,000 = $25,000 ($5,000 more), or the same revenue on 20,000 ÷ 5 = $4,000 of ad spend
The ads are profitable: 4× is a third above the 3× break-even. They miss the 5× target, and the channels show why:
| Channel | Ad spend | Revenue | ROAS | Share of spend / revenue |
|---|---|---|---|---|
| Google Ads | $2,000 | $11,000 | 5.5× | 40% / 55% |
| Meta Ads | $1,800 | $6,300 | 3.5× | 36% / 31.5% |
| TikTok Ads | $1,200 | $2,700 | 2.25× | 24% / 13.5% |
TikTok Ads returns 2.25×, below the 3× break-even. Before cutting it, the shop should check whether its campaigns reach new customers who later buy through search: platform ROAS credits the last click it can see, not the first contact.
Press Show example in the calculator to load these numbers, including the channels, and change any of them.
B2B and services
ROAS when revenue comes weeks after the click
If your ads bring leads that a sales team closes later, the ad platform cannot see the revenue when you need to decide on budgets.
Say $3,000 of ads brings 60 leads, a cost per lead of $50. If 10% of leads become customers at $2,000 each, the ads should bring 6 deals and $12,000 of revenue: an expected ROAS of 4×.
Check this against real closed deals once they come in, and record the deal value in your CRM so each sale can be traced back to the campaign. Until then, steer by the numbers that arrive first: cost per lead, the lead-to-customer rate and customer acquisition cost. For subscriptions, first-month revenue understates ROAS; compare acquisition cost with lifetime value in the LTV:CAC Calculator.
Benchmarks
What is a good ROAS?
The only ROAS that decides whether your ads pay is your break-even. Outside figures help to check whether a channel is far off. We use one dataset we could trace to a named, dated source on November 12, 2026.
Platform ROAS and incremental ROAS
Common Thread Collective, an ecommerce agency, measured 299 direct-to-consumer brands with $231 million of paid media spend from January to March 2026. Next to the ROAS each platform reports, it shows an incremental ROAS (iROAS): an estimate, from its geo-holdout tests and media-mix models, of the revenue that would not have happened without the ads.
| Channel (Q1 2026) | Platform ROAS | Incremental ROAS |
|---|---|---|
| Google brand search | 19.07× | 5.72× |
| Google non-brand search | 9.30× | 6.97× |
| 6.57× | 2.76× | |
| Snapchat | 6.18× | 1.85× |
| Meta, existing customers | 5.88× | 3.53× |
| TikTok | 4.50× | 3.60× |
| YouTube | 1.86× | 2.04× |
| Meta, new customers | 1.83× | 2.07× |
| AppLovin | 1.17× | 1.73× |
What this means for your numbers
Brand search and retargeting report high ROAS partly because they reach people who would have bought anyway. Prospecting on Meta or YouTube reports low ROAS but, by this estimate, creates more of its revenue. Judge channels on their role, not only on the ROAS in the ad account.
These figures come from online shops. Lead-generation and B2B businesses should not compare against them; use the expected ROAS above and your own trend.
Better results
How to improve ROAS
ROAS goes up when the same ad spend brings more revenue, or the same revenue needs less ad spend. Start with the steps that cost nothing.
1. Fix tracking first
Missing purchase events, revenue without tax and shipping rules, or a conversion counted twice change ROAS more than any campaign tweak. Check that the conversion value in the ad account matches the orders in your shop or CRM.
2. Split brand from non-brand
Brand search often shows the highest ROAS because people already looking for you click it. Report it separately so it does not hide weak prospecting campaigns.
3. Move budget by channel, against break-even
Use the channel table: shift spend from channels below break-even to those above it, in steps, and watch total profit, not only the blended ROAS.
4. Raise the order value
Bundles, a free-shipping threshold and well-placed add-ons lift revenue per order, and ROAS with it, without more clicks.
5. Convert more of the visitors you paid for
A faster landing page, a clearer offer and an answer to the question that stops someone from buying all raise revenue from the same ad spend. A website chat that replies at once, day and night, keeps paid visitors from leaving with an open question.
6. Cut spend that brings nothing
Exclude search terms, placements and audiences that spend without converting, and stop ads to existing customers that only collect credit for orders they would have placed anyway.
FAQ
ROAS questions
What is ROAS?
Return on ad spend (ROAS) is the revenue from your ads divided by what you spent on them. $20,000 of revenue from $5,000 of ad spend is a ROAS of 4×, or 400%.
How do you calculate ROAS?
Divide the revenue credited to your ads by the ad spend for the same period and campaigns. Multiply by 100 for a percentage. If you only know orders, revenue is orders × average order value.
What is a good ROAS?
One above your break-even ROAS, which is 1 ÷ your gross margin. At a 40% margin you need at least 2.5× just to cover product costs. Outside benchmarks vary widely by channel: Common Thread Collective's Q1 2026 data on 299 online shops shows a platform ROAS of 9.30× for Google non-brand search and 1.83× for Meta prospecting.
What is break-even ROAS?
The ROAS at which gross profit from ad-driven sales exactly pays for the ads. Break-even ROAS = 1 ÷ gross margin, so a 25% margin needs 4× and a 50% margin needs 2×. Add agency fees and other campaign costs and the break-even goes up.
What is the difference between ROAS and ROI?
ROAS divides revenue by ad spend. ROI divides profit by cost. A campaign with a 3× ROAS on a 20% margin has a negative ROI: $3,000 of revenue leaves $600 of gross profit against $1,000 of ad spend.
What is POAS?
Profit on ad spend: gross profit from ad-driven sales divided by ad spend. A POAS above 1 means the ads earn more gross profit than they cost. It is ROAS multiplied by your gross margin.
Is ROAS 4 the same as 400%?
Yes. 4×, 4:1 and 400% all mean $4 of revenue for every $1 of ad spend. Google Ads enters target ROAS as a percentage; the calculator accepts both.
How do I calculate ROAS for lead generation?
Estimate the revenue the leads will bring: leads × lead-to-customer rate × average deal value, then divide by ad spend. 60 leads, 10% of them closing at $2,000, from $3,000 of ads is an expected ROAS of 4×. Check it later against closed deals in your CRM.
Does the calculator store my data?
No. Everything runs in your browser. The share link keeps your numbers in the address after the # sign, which is not sent to our server.
References
Sources
- Target ROAS definition, 500% example and conversion requirements: Google Ads Help, "About Target ROAS bidding", checked November 12, 2026
- ROAS and break-even ROAS formulas, advertisers A and B: Amazon Ads, "Practical calculations for holiday marketing success", checked November 12, 2026
- Costs that belong in gross margin, $100 product example: Shopify Staff, "Break-Even ROAS Calculator: How To Measure Break-Even ROAS", September 2, 2026
- Platform and incremental ROAS by channel, 299 DTC brands, January to March 2026: Common Thread Collective, "Q1 2026 Ecommerce Ad Spend Benchmark: Channel Allocation and Incremental ROAS Across 299 DTC Brands", April 2026
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