ROAS Calculator

Know whether your ads actually pay for themselves

ROAS, short for return on ad spend, answers a blunt question: for every unit of currency you put into advertising, how much revenue came back? A ROAS of 4 means 4 earned for every 1 spent. It is one of the quickest ways to compare campaigns, channels and creatives, and it is the number most ad platforms report.

The catch is that revenue is not profit. A 4x ROAS can be excellent for a high-margin software product and a loss for a low-margin retailer. That is why this calculator also asks for gross margin. With it, the tool works out your break-even ROAS and tells you whether a campaign is truly profitable once product costs are covered.

Formulas

• ROAS = revenue from ads ÷ ad spend
• ROI on ad spend = (revenue − ad spend) ÷ ad spend × 100
• Break-even ROAS = 1 ÷ gross margin (as a decimal)
• CPA = ad spend ÷ conversions

The planner tab works backwards. Give it a target ROAS and a budget to see the revenue you need, or give it a revenue goal to see the most you can afford to spend.

How to use the ROAS Calculator

1. Pick your currency symbol.
2. On Calculate ROAS, enter your ad spend and the revenue the ads produced.
3. Add conversions to see cost per conversion and average order value, and gross margin to see break-even ROAS and profit.
4. Press Calculate and read the verdict at the bottom of the result.
5. Switch to Plan a campaign to turn a target ROAS into a revenue or budget figure.

What you get

• ROAS shown as a multiple and a percentage.
• ROI, profit after product costs and break-even ROAS when you supply a margin.
• Cost per conversion and average order value from conversion counts.
• A planner that works from a target ROAS to either revenue needed or maximum spend.
• Four currency symbols and plain-language verdicts.

When it comes in handy

• Comparing Google, Meta and email campaigns on the same basis.
• Checking whether a promotion is profitable before scaling the budget.
• Setting a realistic ROAS target for an agency or in-house team.
• Working out how much you can afford to pay for each sale.
• Reporting results to a client or manager with the formula visible.

What is a good ROAS?

There is no single answer. It depends on your margin, your costs and how much repeat business a customer brings. Break-even ROAS is the honest floor: at a 50 percent margin it is 2x, at 25 percent it is 4x, and at 10 percent it is 10x. Anything above that line earns a profit on the first order. Businesses with strong repeat purchases can accept a ROAS closer to or even below break-even on the first sale, because later orders make up the difference.

Tips for better results

• Use revenue and spend from the same period and the same campaign, or the ratio will mislead you.
• Remember that platform-reported revenue is often attributed generously. Compare it with your own sales data when you can.
• Include agency fees and creative costs in “ad spend” if you want a full picture.
• ROAS ignores customer lifetime value. For subscriptions and repeat buyers, look at LTV as well.
• Look at ROAS by campaign rather than only in total. One weak campaign can hide behind a strong one.

Marketers who manage several campaigns tend to keep a few calculators handy, and UseTools.in collects more free tools of that kind.

Frequently asked questions