ROAS vs profit
ROAS is revenue divided by ad spend. It does not include gross margin, fulfilment, refunds or operating costs. This calculator adds gross margin and other variable costs to show whether the ad result may contribute profit after ad spend.
Example
If ads produce $10,000 in attributed revenue from $2,500 in spend, ROAS is 4.0x. At 60% gross margin, gross profit before ads is $6,000, leaving $3,500 before other variable costs.
Break-even ROAS
Approximate break-even ROAS is 1 divided by gross margin. At 60% gross margin, break-even ROAS is about 1.67x before any other costs.
Common mistakes
Do not treat ROAS as profit. Attribution windows, returns, shipping, discounts and repeat purchases can make channel economics very different from the headline ROAS.
Last reviewed: 2026-05-17