What Is ROAS?
Return on Ad Spend (ROAS) measures how much revenue your advertising generates for every dollar you invest. It is one of the most important efficiency metrics in digital marketing, used across Google Ads, Meta, TikTok, and any paid channel. A ROAS of 4x means you earn $4 in revenue for every $1 spent on ads.
How to Use This Calculator
Enter the total revenue attributed to your ad campaign and the total amount you spent on those ads. Optionally add the number of conversions (sales, sign-ups, leads) to also see your Cost Per Acquisition. The calculator returns ROAS as a multiple, ROAS as a percentage, your gross profit, and your CPA.
The Formula Explained
ROAS is simply Revenue ÷ Ad Spend. Multiply by 100 to express it as a percentage. Gross profit is Revenue − Ad Spend (before product and overhead costs). CPA is Ad Spend ÷ Conversions, telling you what each customer cost to acquire.
$$\text{ROAS} = \frac{\text{Revenue from Ads}}{\text{Ad Spend}}$$$$\text{Profit} = \text{Revenue from Ads} - \text{Ad Spend}$$$$\text{CPA} = \frac{\text{Ad Spend}}{\text{Conversions}}$$
Worked Example
Suppose a campaign generated $10,000 in revenue from $2,500 in ad spend with 100 conversions. ROAS = \(10{,}000 \div 2{,}500 = \mathbf{4\times}\) (400%). Gross profit = \(10{,}000 - 2{,}500 = \mathbf{\$7{,}500}\). CPA = \(2{,}500 \div 100 = \mathbf{\$25}\) per customer.
$$\text{ROAS} = \frac{10{,}000}{2{,}500} = 4\times = 400\%$$$$\text{Profit} = 10{,}000 - 2{,}500 = \$7{,}500$$$$\text{CPA} = \frac{2{,}500}{100} = \$25$$
FAQ
What is a good ROAS? It depends on margins, but many businesses target 3x–4x or higher to stay profitable after product and operating costs.
Is ROAS the same as ROI? No. ROAS only compares revenue to ad spend, while ROI accounts for all costs and is expressed as net profit relative to investment.
What's the difference between ROAS and CPA? ROAS measures revenue efficiency (return), while CPA measures the average cost to acquire one conversion.
