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ROAS Calculator

Measure the return on your advertising spend.

How it is calculated

ROAS divides the revenue attributed to a campaign by the money spent on its ads: ROAS = revenue / ad spend. Both amounts should be in the same currency and cover the same period. The tool shows the ratio (4.00 means 4 units of revenue per 1 unit of spend) and the same figure as a percentage, ratio × 100. Ad spend must be greater than zero and revenue cannot be negative; otherwise there is no result. ROAS counts revenue, not profit, so it says nothing about margins or other costs. The break-even ROAS depends on your own margin, for example a 25 percent margin needs a ratio of at least 4.

Worked example

A campaign cost 3,000 and the sales tracked back to it were 12,000. ROAS = 12,000 / 3,000 = 4.00, and as a percentage 4.00 × 100 = 400.00%. That means every unit spent brought back four units of revenue, before product cost, shipping or fees.

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Common mistakes

  • Confusing ROAS with ROI: ROAS uses revenue, ROI uses profit after costs, so a high ROAS can still lose money.
  • Entering profit instead of revenue, which understates the result.
  • Mixing periods, such as a month of spend against a quarter of revenue.
  • Leaving out agency fees or creative costs that belong in total ad spend when you judge the whole programme.
  • Reading 400.00% as a 400 percent gain; it means revenue was four times the spend.

Sources

About this calculator

This calculator divides revenue generated by an ad campaign by the amount spent on it, expressing the result as a ratio like 4:1 or "$4 for every $1 spent" — the standard ROAS (Return on Ad Spend) formula used across digital advertising. Unlike ROI, ROAS looks only at gross revenue against ad cost, without subtracting product cost, shipping or other overhead.

Performance marketers reporting campaign results, e-commerce sellers deciding whether to scale a Facebook or Google Ads campaign, and agencies benchmarking one client's account against another all use ROAS as the first health check on ad spend, typically looking for at least 3:1–4:1 to stay profitable after other costs are factored in.

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Comments (1)

  • Editorial team

    A ROAS of 4 does not mean you made money. The break-even point is 1 divided by your gross margin: at a 40% margin you need a ROAS of 2.5 just to cover the ad spend, and anything below that loses money on those sales. Use revenue attributed to the ads and spend for the same period. Which margin do you work with, and where does your break-even ROAS land?

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