ROAS Calculator
Return on ad spend, the margin-adjusted version that actually matters, and the break-even ROAS you need.
ROAS is revenue divided by ad spend.
How the roas calculator works
ROAS is revenue divided by ad spend. A ROAS of 4 means four units of revenue per unit spent, usually written 4:1 or 400%.
The trap is that ROAS is a revenue measure, not a profit measure. If your gross margin is 30%, a 4:1 ROAS earns 1.20 of gross profit per 1.00 spent — profitable, but far less comfortable than "400%" sounds. At a 20% margin the same campaign loses money.
Break-even ROAS is the number to know before launching: 1 divided by your gross margin. At a 30% margin you need 3.33:1 just to cover the ad cost.
Formula: ROAS = revenue / ad spend; break-even ROAS = 1 / gross margin
Worked examples
| Inputs | ROAS | Note |
|---|---|---|
| 48,000 revenue on 12,000 spend | 4 : 1 | 4:1, and profitable at a 45% margin |
| The same ROAS at a 20% margin | 4 : 1 | below break-even — it loses money |
| A thin campaign | 1.25 : 1 | 1.25:1 |
FAQFrequently asked questions
What is ROAS?
Revenue divided by advertising spend. A 4:1 ROAS means four units of revenue for every one spent.
Is a 4:1 ROAS good?
It depends on your margin. At 45% it is comfortably profitable; at 20% it loses money.
What is break-even ROAS?
One divided by your gross margin. At a 30% margin you need 3.33:1 to cover the ad cost alone.
What is the difference between ROAS and ROI?
ROAS uses revenue and only counts ad spend. ROI uses profit and counts all costs, so it is always the lower and more honest figure.
Why does ROAS overstate performance?
Because revenue is not profit, and because attribution usually credits the ad with sales that would have happened anyway.
Where these figures come from
- Interactive Advertising Bureau — measurement guidelines — the impression and viewability definitions CPM depends on
- Australian Competition and Consumer Commission — the Australian consumer law regulator
Last checked: September 2026. These are standard industry definitions; where platforms disagree, the page says so.