Free tool ROAS calculator: ROAS formula and break-even ROAS
ROAS is the revenue each unit of ad spend brings back. Enter revenue and spend to get it; add your gross margin and the calculator also shows the ROAS you need to break even, and whether the campaign clears it.
- Revenue, spend and margin
- Updates as you type
- Runs locally
Work out ROAS and your break-even point
Revenue and spend are required. Gross margin is optional but unlocks break-even ROAS and profit.
Sales attributed to the ads in the period, in your currency.
What the ad platforms charged for the same period.
Share of revenue left after the cost of goods, e.g. 40. Optional.
ROAS (return on ad spend)
4.00×
Revenue divided by ad spend.
Share these inputs: the values go after the # in the link, so they never reach a server.
https://tapcub.com/tools/roas-calculator
Version v1.0Updated Update history
What the numbers tell you
ROAS on its own says how much revenue you bought. Break-even ROAS says how much you needed to buy for the ads to pay for themselves.
ROAS
A 4.00× ROAS means every $1 of ad spend brought in $4 of revenue. It is a multiple, not a percentage; some tools show the same thing as 400%.
Break-even ROAS
The ROAS at which gross profit equals ad spend: 1 ÷ margin. At 40% margin it is 2.50×; at 25% it is 4.00×. Thin margins need much higher ROAS.
Gross profit after ad spend
What is left from the sales after the cost of goods and the ads. It still has to cover fixed costs such as salaries and rent.
Above or below
Compare ROAS with break-even, not with 1.00×. A 3.00× campaign is profitable at 40% margin and loses money at 25%.
ROAS counts only the sales inside the attribution window. Customers who return and buy again later are not in it, so a channel that brings loyal customers can be worth more than its ROAS.
Three ways to use the calculator
One formula, three planning questions.
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1
Check a campaign
Enter revenue and spend from the same report, add your margin, and see whether ROAS clears break-even.
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2
Set a target ROAS
Enter your margin with any revenue and spend; break-even ROAS is the floor for a bidding target. Add room for fixed costs and profit on top.
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3
Test a price change
Change the margin to see how a discount moves break-even. Cutting margin from 40% to 30% lifts it from 2.50× to 3.33×.
ROAS = revenue ÷ ad spend
Break-even ROAS comes from setting gross profit equal to spend: revenue × margin = spend, so revenue ÷ spend = 1 ÷ margin.
- Use revenue and spend from the same period, campaign and currency
- Gross margin should subtract the cost of goods, shipping, payment fees and marketplace commission
- ROI = ROAS × margin − 1, so a 4.00× ROAS at 40% margin is a +60% ROI
ROAS
ROAS = revenue ÷ ad spend
$12,000 revenue from $3,000 spend → 4.00×
Break-even ROAS
break-even ROAS = 1 ÷ gross margin
40% margin → 1 ÷ 0.40 = 2.50×
Profit after ads
profit = revenue × margin − ad spend
$12,000 × 40% − $3,000 = $1,800
The same 3.00× ROAS at five margins
A campaign returns 3.00× on $1,000 of ad spend, so $3,000 in revenue. Whether that is good news depends entirely on the margin.
| Gross margin | Break-even ROAS | Gross profit on $3,000 | Result after $1,000 spend |
|---|---|---|---|
| 20% | 5.00× | $600 | −$400 |
| 30% | 3.33× | $900 | −$100 |
| 40% | 2.50× | $1,200 | +$200 |
| 50% | 2.00× | $1,500 | +$500 |
| 70% | 1.43× | $2,100 | +$1,100 |
A software product with 70% margin earns $1,100 from the same ROAS that costs a low-margin reseller $400. Sample figures.
Where ROAS goes wrong
ROAS is easy to compute and easy to over-read.
Treating 1.00× as break-even
At 1.00× you got your ad money back in revenue, but the goods you sold still cost something. Break-even is 1 ÷ margin.
Margin that leaves costs out
If shipping, returns, payment fees or marketplace commission are not in the margin, break-even ROAS looks lower than it is.
Adding up platform ROAS
Each platform counts the conversions it touched, often with view-through. Their revenue together can exceed what you actually sold.
Judging on a short window
A 7-day ROAS misses customers who buy later or come back. Compare like with like and keep the window fixed.
Return on spend, per channel, in one report
TapCub reads UTM parameters and ad click IDs on arrival and counts each order once on your site. Import spend and the channel ROI column is attributed revenue divided by spend: the same multiple as ROAS, next to the conversions behind it.
Campaign and channel reports
Sessions, conversions and conversion rate per campaign, source and medium.
Learn moreChannel ROI
Import spend and see return per channel next to the traffic it bought.
Learn moreFirst and last touch
The campaign that introduced a customer and the one that closed, on the same person.
Learn moreROAS questions
Still have a question?
Chat with the team behind TapCub — we usually reply within a few hours on business days.
How do I calculate ROAS? What is the ROAS formula?
ROAS = revenue from ads ÷ ad spend. $12,000 in revenue from $3,000 of spend is $12,000 ÷ $3,000 = a ROAS of 4.00×. To show it as a percentage, multiply by 100: 4.00× is 400%. Use revenue and spend from the same campaign and date range.
What is break-even ROAS?
The ROAS at which the gross profit on ad-driven sales exactly pays for the ads. It is 1 ÷ gross margin: 2.50× at 40% margin, 4.00× at 25%. Below it, each sale you bought lost money.
What is ROAS?
Return on ad spend: the revenue attributed to ads divided by what the ads cost. It is usually written as a multiple, such as 4.00×, or sometimes as a percentage, such as 400%.
What is a good ROAS?
One that sits comfortably above your break-even ROAS once fixed costs are covered. Because margins vary so much, a figure that is healthy for one business is a loss for another; compare with your own break-even and history rather than a general average.
What is the difference between ROAS and ROI?
ROAS uses revenue and only ad spend. ROI uses profit and can include every cost of the campaign. With a 40% margin, 4.00× ROAS equals +60% ROI. The marketing ROI calculator does the profit version; the glossary explains both.
How do I set a target ROAS for bidding?
Start from break-even ROAS, then add enough for fixed costs and the profit you want. Platforms that bid toward a target ROAS will try to hit it on their own attributed revenue, so check results against orders on your site.
Why is my platform ROAS higher than my real results?
Platforms attribute with their own windows, often include view-through conversions, and each claims the sale for itself. Counting orders once on your own site gives a lower but more reliable figure.
Update history
New features, fixes and data refreshes for this tool, newest first.
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· v1.0
LaunchedFirst release.
Missing something or found an error? Tell us — requests that come up often go into the next update. All tool updates
See return on spend for every channel
Connect your site and every tagged campaign shows visits, conversions and revenue beside its cost.