ROAS & Ad Budget Calculator
Four calculators advertisers actually need, in one place: ROAS, the break-even ROAS your margin demands, target CPA, and the monthly budget required to hit a revenue goal. Free, no signup.
ROAS, break-even ROAS and why 3× isn't automatically good
ROAS (return on ad spend) is revenue attributed to ads divided by what the ads cost — $4,200 from $1,000 of spend is a 4.2× ROAS. It is the advertising world's favorite number and also its most misused, because a ROAS means nothing until you know your margin: a 3× ROAS is comfortably profitable for a 60%-margin service business and money-losing for a 25%-margin retailer.
Break-even ROAS is the line between those cases: selling price ÷ gross profit per unit. Sell at $80 with $48 of cost and your gross profit is $32, so break-even ROAS = 80 ÷ 32 = 2.5× — every campaign above 2.5 makes money, every one below it loses money no matter how impressive the number looks in the ads dashboard. This one division is the most valuable ten seconds of math in paid marketing.
The budget tab inverts the same arithmetic for planning: to add $10,000/month of revenue at an expected 3× ROAS you need about $3,333/month of spend — and if your average order is $80, that is ~125 orders, which tells you whether your fulfillment can even absorb success. Platforms' own automation also has budget floors (Google's Performance Max and Meta's Advantage+ both want dozens of conversions per week to learn), which is why very small budgets need closer human — or AlwaysOn — supervision rather than full platform automation.
Frequently asked questions
What is a good ROAS?
Whatever clears your break-even ROAS with room for overhead — there is no universal number. E-commerce at typical margins usually needs 2.5–4× to profit; high-margin services can profit at 1.5×; grocery-thin margins can need 6×. Compute break-even first, then judge.
Is ROAS the same as ROI?
No. ROAS compares revenue to ad spend only; ROI compares profit to total cost including goods, fulfillment and fees. A campaign can have a positive ROAS and a negative ROI — that's exactly what break-even ROAS exists to catch.
Should I use revenue ROAS or profit ROAS?
Platforms report revenue ROAS, so use it for in-platform optimization — but make decisions against your break-even line, or track POAS (profit over ad spend) if your products have very different margins.
Why does my ads manager show a higher ROAS than my bank account suggests?
Attribution. Platforms credit themselves for conversions that may also be counted by other channels, include view-through conversions, and use windows up to 28 days. Treat platform ROAS as directional and reconcile monthly against actual revenue.
What budget do I need to start advertising?
Enough to buy real signal: at a $25 cost per customer, $500/month buys ~20 conversions — the bare minimum to judge a campaign. Below that, favor tightly-targeted campaigns over the platforms' broad automation, which under-performs when it can't get ~50 conversions a week to learn from.
How do I include shipping, fees and returns in break-even?
Fold them into the cost side: cost of goods + payment fees + average shipping subsidy + (return rate × refund cost). The formula stays price ÷ (price − all that); your break-even ROAS rises accordingly — honest inputs, honest line.
What's target CPA and when is it better than ROAS?
Target CPA is the most you can pay to acquire one customer: AOV × margin (minus whatever profit you insist on keeping). Lead-gen businesses without carted revenue should optimize to CPA; stores with varied basket sizes usually prefer ROAS.
Related free tools
- Facebook Ad Copy Generator — write the ads this math approves
- UTM Builder — attribute the revenue you're dividing
- Engagement Rate Calculator
- Social Media Character Counter