Wealth Compass Collective
MenuClose
Return on ad spend

ROAS calculator

A 3x ROAS sounds great until you check the margin. Enter what you spent, what it brought in and your margin, and see if the ads really paid for themselves.

Free, no sign-upInstant answerSources listed

A notebook sketch of an email funnel next to a phone showing an inbox

Your numbers

What's left of each sale after product, fees and delivery. Affiliate commissions are 100% margin: use your commission as revenue.

Results update as you type.

Example result

ROAS 3x, above your 2.5x break-even: these ads made $100 in profit.

3xROAS
2.5xbreak-even ROAS
$100profit after ads

Scale slowly: ROAS usually drops as budgets grow and you reach colder audiences.

ROAS as a percentage
300%
Gross profit before ads
$600
Revenue needed to break even
$1,250
Return on the ad money (ROI)
20%
Where the money wentAd spend: 500 $; Revenue: 1,500 $; Gross profit: 600 $; Kept after ads: 100 $500 $Ad spend1,500 $Revenue600 $Gross profit100 $Kept afterads
Revenue is not profit: the ads have to come out of what's left after costs.

The two numbers that matter

ROAS is revenue from ads divided by what the ads cost. $1,500 of sales from $500 of ads is a 3x ROAS (300%).

Break-even ROAS is 1 divided by your profit margin. At a 40% margin you need 2.5x just to cover the ads. At a 25% margin you need 4x. That's why one store celebrates a 3x ROAS and another quietly loses money on it.

ROAS for affiliates

If you run ads to affiliate offers, your revenue is the commission you earn, not the price of the product, and your margin is effectively 100%. So your break-even ROAS is 1x: every dollar of commission has to beat every dollar of ads.

Send paid traffic to an email sign-up first and the sale can come later, from the follow-up emails, so judge those campaigns over 30 days, not one.

Ways to lift ROAS without raising the budget

  • Fix the page before the ad: a faster, clearer page lifts every ad pointed at it.
  • Raise the order value with bundles or an upsell.
  • Cut the placements and audiences that spend without selling.
  • Retarget people who visited but didn't buy; they usually convert at a higher rate.

Questions people ask

How do you calculate ROAS?

Divide revenue from ads by ad spend. $2,000 revenue on $400 of ads is a 5x ROAS.

What is a good ROAS?

Anything above your break-even ROAS, which is 1 ÷ your profit margin. At a 50% margin, anything above 2x makes money.

How do I calculate break-even ROAS?

Divide 1 by your margin as a decimal. A 30% margin gives 1 ÷ 0.30 = 3.33x.

What's the difference between ROAS and ROI?

ROAS compares revenue to ad spend. ROI compares profit after all costs to what you spent, so it tells you whether the campaign actually made money.

More free tools

All tools