Free tool

ROAS calculator

Calculate your return on ad spend, see whether your ads are profitable, and compare it to the break-even ROAS for your margin.

Revenue from ads

Ad spend

Gross profit margin

Revenue minus product, shipping and transaction costs, as a percentage of revenue.

Your ROAS

4.00x

400% return on ad spend

Break-even ROAS

2.50x

The ROAS where ad spend equals gross profit

Profit after ad spend

$1,800

Your ads are profitable at this margin

How to calculate ROAS

Return on ad spend (ROAS) measures how much revenue you earn for every dollar spent on advertising. The formula is simple:

ROAS = revenue from ads ÷ ad spend

Spend $3,000 on Google Ads and generate $12,000 in sales, and your ROAS is 4x. For every $1 you spent, you got $4 back in revenue.

Why ROAS alone doesn't tell you if you're profitable

Revenue isn't profit. If your gross margin is 40%, $12,000 in revenue produces $4,800 in gross profit. Subtract $3,000 in ad spend and you keep $1,800. At a 20% margin, the same 4x ROAS would lose you $600.

That's why the calculator also shows your break-even ROAS: 1 divided by your margin. Any ROAS above it makes money, and anything below it loses money. Use our break-even ROAS calculator for a more detailed version that includes shipping and fees, or read our guide on what a good ROAS is for e-commerce.

How to improve ROAS on Google Ads

Cut wasted spend with negative keywords and regular search term reviews.
Improve product titles and attributes in your Merchant Center feed so ads match better searches.
Separate high-margin and low-margin products so each gets its own ROAS target.
Make sure conversion tracking records each purchase once, with the correct value.
Raise average order value with bundles, free-shipping thresholds and upsells.

More free tools

Break-even ROAS calculator Google Ads budget calculator

FAQ

Frequently Asked Questions

ROAS equals revenue from ads divided by ad spend. If you spend $1,000 and the ads bring in $4,000 in revenue, your ROAS is 4, often written as 4x or 400%.

A good ROAS is one above your break-even ROAS, which depends on your profit margin. A store with a 50% margin breaks even at 2x, while a store with a 25% margin needs 4x just to break even.

ROAS only compares revenue to ad spend. ROI accounts for all costs, including product costs, shipping and fees, so it shows actual profit. A high ROAS can still mean a loss if margins are thin.

Only if conversion tracking is accurate. Google Ads ROAS uses the conversion values it records, so double-counted purchases or missing values make it look better or worse than reality.

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ROAS calculator

How to calculate ROAS

Why ROAS alone doesn't tell you if you're profitable

How to improve ROAS on Google Ads

Frequently Asked Questions

How do you calculate ROAS?

What is a good ROAS for e-commerce?

What's the difference between ROAS and ROI?

Is ROAS in Google Ads the same as my real ROAS?

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