ROAS calculator
Return on ad spend tells you how much revenue every dollar of advertising brings back. This calculator also shows profit after product costs, so you can see whether a good-looking ROAS is actually making money.
This campaign is profitable after product costs.
How to use this tool
- 1Enter the revenue attributed to your ads.
- 2Enter what you spent on those ads.
- 3Add your gross margin so the calculator can show real profit.
- 4Compare your ROAS with the break-even ROAS shown in the results.
- 5Use the result to decide whether to scale, fix or pause the campaign.
The ROAS formula
ROAS equals revenue from ads divided by ad spend. A ROAS of 3 means every dollar spent returned three dollars of revenue. It is often written as 3x or 300%.
Revenue is not profit. If your products have a 50% gross margin, half of that revenue pays for the goods, shipping and fees. That is why the break-even ROAS matters: it is 1 divided by your margin. At a 50% margin you need a 2x ROAS just to cover ad and product costs.
Worked example
A campaign spends 2,000 dollars and brings in 6,000 dollars of revenue, a 3x ROAS. With a 60% gross margin, the gross profit is 3,600 dollars. After subtracting the 2,000 dollars of ad spend the campaign earned 1,600 dollars. The break-even ROAS at a 60% margin is about 1.67x, so this campaign has healthy room to scale.
| Gross margin | Break-even ROAS |
|---|---|
| 30% | 3.33x |
| 40% | 2.50x |
| 50% | 2.00x |
| 60% | 1.67x |
| 70% | 1.43x |
Frequently asked questions
What is a good ROAS for Facebook ads?
A good ROAS is any ROAS comfortably above your break-even point. A brand with 70% margins can be profitable at 1.8x, while a store with 25% margins may need 4x or more.
What is the difference between ROAS and ROI?
ROAS compares revenue to ad spend only. ROI compares profit to total investment, including product costs and overheads. ROAS is a quick campaign metric, ROI is a business metric.
Why does my ROAS look different in Meta and Shopify?
Meta uses its own attribution window and modelled conversions, while your store records actual orders. Small differences are normal, large ones usually point to tracking problems.
How do I improve ROAS?
Raise average order value with bundles, improve conversion rate on the landing page, and refresh creatives before they fatigue. Reviewing which ads competitors keep running helps you find angles worth testing.
Should I include shipping in revenue?
Use the same definition every time. Most brands use revenue excluding taxes, and include shipping costs inside the margin input so profit stays accurate.
See which Facebook and Instagram ads your competitors keep running, the clearest signal of what is profitable in your niche.