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Break-Even ROAS Calculator

Break-even ROAS is the lowest return on ad spend at which a campaign stops losing money. Enter your profit margin, or build it from your real costs (product cost, shipping, payment fees and returns), to get your break-even ROAS and the most you can pay to acquire a customer. A third tab shows the ROAS you need to hit a target profit.

%

Margin before ad spend, as a % of price.

$

Needed for max CPA.

Break-even ROAS

4.00x

Max break-even CPA
$20.00

How it's calculated

Break-even ROAS = 100 ÷ Profit margin %

If you keep 25 cents of every sales dollar before ad costs, you must earn $4 in revenue per $1 of ads to cover that spend. Max break-even CPA = Average order value × Margin %. Above these levels you make a profit; below them you lose money on each sale.

Worked example

Your product sells for $80 with a 25% margin. Break-even ROAS = 100 ÷ 25 = 4.0x. Max CPA = $80 × 0.25 = $20. If an ad campaign is returning a 3.2x ROAS, you are below break-even: every $1,000 spent brings in $3,200 of sales, which earns $800 at a 25% margin, so you lose about $200.

Break-even ROAS by margin

Use your contribution margin after product cost, shipping and payment fees, not just gross margin, for the most honest number.

Break-even ROAS by margin
Profit marginBreak-even ROAS
10%10.0x
20%5.0x
30%3.3x
40%2.5x
50%2.0x
70% (digital products)1.4x

Frequently asked questions

What is break-even ROAS?

It is the ROAS at which your ad revenue exactly covers the cost of the goods sold plus the ads themselves, leaving zero profit. Any ROAS above it is profitable on the first order.

How do I calculate break-even ROAS?

Divide 1 by your profit margin as a decimal, or 100 by your margin as a percent. A 20% margin gives 1 ÷ 0.20 = 5.0.

What margin should I use?

Use margin after product cost, shipping, packaging, payment processing and returns but before ad spend. The From your costs tab builds this number from each cost, and including more costs gives a more realistic break-even.

What ROAS do I need to make a profit, not just break even?

Break-even only covers costs. To keep a target net margin, use ROAS = 100 ÷ (margin % − target %). With a 40% margin and a 10% target, you need 100 ÷ 30 = 3.3x. The Target profit tab does this sum.

Can I run ads below break-even ROAS?

Yes, if customers buy again. Businesses with strong repeat purchases or subscriptions often accept a first-order loss because lifetime value covers it. Without repeat sales, running below break-even loses money. The ROAS calculator shows where a campaign stands today.

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