How to Calculate ROAS (Return on Ad Spend)

This calculator works out your Return on Ad Spend (ROAS) — the revenue you earn for every dollar you spend on advertising. You enter your total ad revenue and your total ad spend, and you get back the ROAS ratio (e.g., 4.0) and the percentage version (e.g., 400%). ROAS is the key metric for judging whether an ad campaign is profitable, and this tool makes the math instant.

Formula

ROAS is a simple ratio:

ROAS = Total Ad Revenue ÷ Total Ad Spend

Where:

Ad Revenue = the total sales revenue directly attributed to your ad campaigns (in your currency, e.g., $, €, £).
Ad Spend = the total amount you spent on those same campaigns (in the same currency).

The result is usually written as a ratio (e.g., 4.5:1) or as a percentage (e.g., 450%). A ROAS of 4.0 means every $1 of ad spend brings in $4 of revenue.

Worked Example

Using the default values from the calculator:

Ad Revenue = $10,000
Ad Spend = $2,500

Step 1: Divide revenue by spend:

$10,000 ÷ $2,500 = 4.0

Step 2: To get the percentage, multiply by 100:

4.0 × 100 = 400%

So the ROAS is 4.0:1 (or 400%). The calculator shows the same result.

When to Use ROAS

ROAS is used by anyone running paid ads — Google Ads, Facebook/Instagram, TikTok, Amazon, or any other platform. It tells you whether your advertising is generating enough revenue to justify the cost. A ROAS above 1.0 means you are making more than you spend; below 1.0 means you are losing money on ads (before considering product costs and overhead).

Use ROAS to:

Compare the performance of different campaigns or ad sets.
Decide whether to scale up or pause a campaign.
Set targets for new campaigns based on your profit margins.

How to Read the Result

The ROAS number itself is not good or bad — it depends on your profit margin. For example, if your product has a 50% gross margin, you need a ROAS of at least 2.0 to break even (because half the revenue goes to product costs). If your margin is 20%, you need a ROAS of at least 5.0 just to cover product costs. So always compare ROAS to your break-even point, not to an arbitrary number.

Common Mistakes

Mixing up revenue and profit. ROAS uses revenue (total sales), not profit. If you use profit, you are calculating return on investment (ROI), not ROAS.
Using different time periods. Revenue and spend must be for the same date range. If you look at monthly revenue but weekly spend, the ratio is meaningless.
Forgetting to include all ad costs. Ad spend includes not just the platform fees but also agency fees, software costs, and any other direct advertising expenses. Inconsistent inclusion across campaigns makes comparisons unfair.
Attribution errors. If you attribute revenue to ads that were not actually responsible (e.g., organic sales), your ROAS will be inflated. Use consistent attribution rules (e.g., last-click, first-click, or data-driven).
Rounding too early. If you round revenue or spend before dividing, you can get a slightly off ROAS. Keep full numbers until the final step.

Tips

Always use the same currency for revenue and spend. If your ads are in USD but your sales are in EUR, convert everything to one currency first.
For a more accurate picture, calculate ROAS for each campaign separately, not just the overall account. A high overall ROAS can hide a losing campaign.
Track ROAS over time to spot trends. A sudden drop might indicate ad fatigue or increased competition.
Combine ROAS with other metrics like cost per acquisition (CPA) and conversion rate to understand why ROAS is high or low.
If you sell products with different margins, consider calculating ROAS per product or product category.

Troubleshooting

If the calculator shows “Cannot compute” or a negative number: This happens when ad spend is zero or negative. Ad spend must be a positive number — you cannot divide by zero. Check that you entered a spend amount greater than 0.

If the ROAS seems unrealistically high: Double-check that you entered revenue, not profit, and that the time period matches the spend. Also verify that your attribution is not counting sales that weren’t driven by ads.

If the ROAS seems too low: Make sure you are including all revenue from the campaign, not just a subset. For example, if you track only online sales but the ads also drive in-store purchases, your revenue will be understated.

If you are comparing ROAS across platforms: Each platform has its own attribution model. A click on Google Ads and a click on Facebook might both get credit for the same sale. Decide on a consistent rule (e.g., last-click) and apply it everywhere.

Frequently Asked Questions

What is a good ROAS? There is no universal number. It depends on your profit margin. A common benchmark is 4:1 for e-commerce, but if your margin is thin, you might need 5:1 or higher. Calculate your break-even ROAS (1 ÷ profit margin) and use that as your minimum.

What is the difference between ROAS and ROI? ROAS is revenue divided by ad spend. ROI is profit (revenue minus all costs) divided by cost. ROAS focuses only on advertising efficiency; ROI includes all costs (product, shipping, overhead).

Can ROAS be negative? No, because both revenue and spend are non-negative (you cannot have negative sales). If you spend money and get no revenue, ROAS is 0. A negative number would only appear if you incorrectly entered a negative spend or revenue.

Should I include taxes in ad spend? It depends on your accounting method. For internal comparison, be consistent. If you include taxes for one campaign, include them for all. For break-even analysis, include all costs that vary with ad spend.

How do I calculate ROAS for a specific product? Track the revenue from that product that can be attributed to your ads, and divide by the ad spend that was specifically for that product (or a fair share of the overall spend). This gives you product-level ROAS, which is useful for inventory decisions.

Does ROAS include refunds or chargebacks? Ideally, yes. Net revenue (after refunds) gives a more accurate picture. If you use gross revenue, your ROAS will be overstated. Most platforms let you pull net revenue, so use that when possible.

Formula used

in rev | Ad Revenue | $ | 10000 | 0 | 1000000000
in spend | Ad Spend | $ | 2500 | 0 | 100000000
out roas | ROAS | :1 | rev / spend | 2
out pct | ROAS % | % | (rev / spend) * 100 | 0

Each line is one input (in, sel, list) or one result (out: label, unit, formula, decimals). How the calculators work

Method: the standard formula for this calculation, rounded as each result states. See how the calculators work or report an error.