→ Free advanced ROAS & profit calculator

ROAS & Profit Calculator

A 4x ROAS can still lose money. Plan a campaign or check one that's running, and see your real profit, break-even ROAS and CPC, and the target ROAS to set in Google Ads or Meta.

Your numbers

Forecast revenue and profit from your budget, CPC and conversion rate.

Campaign inputs

$
$
%
% of clicks that buy
$
Average order or deal value

Margin & fees

%
% of each sale left after product and delivery costs
Management fee, as a % of ad spend or a flat amount

Your profit target

%
The margin you want left after all costs. It sets your target ROAS and the verdict.
  
ROAS-
Net profit-
Break-even ROAS-
Target ROAS -

Where the money goes

Same ad spend. Hover the chart, or focus it and use the arrow keys.

More detail

Clicks purchased-
Buyers-
Revenue-
Cost of goods sold-
POAS-
ROI-Net profit ÷ total marketing cost
CPA-Ad spend per order
Break-even CPA-
Profit breakdown

What if your ROAS changes? (same ad spend)

How to calculate ROAS

Return on ad spend (ROAS) tells you how much revenue you get back for every dollar you put into ads. The formula is simple:

ROAS = Revenue from ads ÷ Ad spend

If a campaign brings in $20,000 in sales from $5,000 in spend, the ROAS is 4, usually written as 4:1, 4x or 400%. All three mean the same thing. Google Ads uses the percentage format when you set a target ROAS bid strategy, so 4x is entered as 400%.

Forecasting ROAS before you spend

If the campaign hasn't run yet, you can estimate ROAS from four numbers you usually already have: budget, cost per click, conversion rate and average purchase value.

Clicks = Budget ÷ CPC
Conversions = Clicks × Conversion rate
Revenue = Conversions × Average purchase value

A $5,000 budget at a $2.50 CPC buys about 2,000 clicks. At a 3% conversion rate that's 60 sales, and at $250 each, $15,000 in revenue, a forecast ROAS of 3x. The "Plan a campaign" tab does this for you and also shows your break-even CPC: the most you can pay per click before the campaign loses money.

The catch is that ROAS only looks at revenue. It ignores what it costs to make, ship and process each sale, which is why a ROAS that looks healthy in the ad platform can still be losing money. That's what the rest of this calculator is for.

Break-even ROAS

Break-even ROAS is the lowest ROAS at which your ads pay for themselves. Below it, every sale from ads costs you money. It depends entirely on your margin after variable costs:

Break-even ROAS = 1 ÷ Contribution margin

Contribution margin is what's left of each revenue dollar after product cost, shipping, payment fees and returns. With a 40% contribution margin, break-even ROAS is 1 ÷ 0.40 = 2.5. A business with 70% margins breaks even at about 1.4, so the same 2.5 ROAS can be a loss for one brand and very profitable for another.

Target ROAS

Breaking even isn't the goal. Target ROAS is the ROAS you need to hit a specific profit margin after ad spend and other campaign costs:

Target ROAS = 1 ÷ (Contribution margin − Target profit margin)

That's the version without fixed costs. The calculator also folds in your other campaign costs (agency fees, creative, tools), which pushes the target up a little. Use the result as the starting point for a tROAS bid strategy in Google Ads or a ROAS goal in Meta, then adjust once you have conversion data.

ROAS vs ROI vs POAS

These three get mixed up all the time. They answer different questions, and the right one depends on what you're deciding.

MetricFormulaWhat it tells youBest for
ROASRevenue ÷ Ad spendHow much revenue ads bring in per dollarComparing campaigns and channels day to day
POASContribution profit ÷ Ad spendHow much gross profit ads bring in per dollar. Above 1 means ads are paying for themselves.Brands with mixed margins across products
ROINet profit ÷ Total costWhether the whole investment made money once every cost is countedBudget decisions and reporting to leadership

What is a good ROAS?

There's no universal number. A "good" ROAS is one that clears your break-even ROAS with enough room left for profit, and that depends on your margins, not your industry. A 3x ROAS is excellent for a software company with 85% margins and a loss for a retailer working on 25%.

A better question than "what's a good ROAS?" is "what's my break-even ROAS, and how far above it am I?" Work out the first number, set your target from it, then judge campaigns against your own target rather than someone else's average.

Two things to keep in mind when you read platform ROAS. First, Google and Meta each use their own attribution, and both can claim the same sale, so platform-reported revenue often adds up to more than your store actually made. Second, ROAS doesn't capture repeat purchases. If customers come back, a lower first-order ROAS can be worth it, which is where customer lifetime value comes in.

Frequently asked questions

What's the difference between ROAS and ROI?

ROAS divides revenue by ad spend and ignores every other cost. ROI divides net profit by the total amount invested, after product costs, fees and other expenses. A campaign can have a 4x ROAS and a negative ROI if margins are thin.

How do I calculate break-even ROAS?

Divide 1 by your contribution margin. If 35% of each sale is left after product, shipping, payment and return costs, your break-even ROAS is 1 ÷ 0.35, or about 2.86. The calculator does this for you once you enter your costs.

What should I enter as revenue?

Use the revenue the ads drove over the same period as the spend. That's usually the conversion value from Google Ads or Meta, or attributed revenue from GA4 or Shopify. Use one source consistently so your numbers are comparable from month to month.

Should I include agency fees in the calculation?

Yes, if you want to know whether the campaign is actually profitable. Leave them out and you'll overestimate your profit and set a target ROAS that's too low. Put them in "Other campaign costs".

What's the difference between the two tabs?

"Plan a campaign" forecasts results before you spend, using your budget, CPC, conversion rate and average purchase value. "Check actual results" uses the spend, revenue and orders a campaign really produced, plus detailed costs like returns, shipping and payment fees. Use the planner to set budgets and bids, and the results tab to judge what's running.

What is break-even CPC?

It's the highest cost per click you can pay before the campaign stops making money on ad spend. It equals your average purchase value × gross margin × conversion rate, reduced by your agency fee if that's charged as a % of spend. If your actual CPC is above it, improve conversion rate or order value, or lower your bids.

How do I use this for lead generation?

In the planner, use your click-to-lead conversion rate, and enter the average value of a lead as the purchase value. That's your average deal value multiplied by your close rate. Use your margin on that deal as the gross profit margin. Break-even CPC and CPA then tell you the most you can pay per click and per lead.

Is my data saved anywhere?

No. The calculator runs in your browser and nothing is sent to our servers. The shareable link puts your inputs in the URL, so only share it with people you're happy to show your numbers to.

Below your break-even ROAS?

Our paid search and paid social teams build campaigns around profit, not just platform ROAS. That means margin-aware bidding, clean conversion tracking, and reporting that matches what lands in your bank account.

See our paid search services Talk to our team

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Advanced ROAS and Profit Calculator

Advanced ROAS and Profit Calculator