ROAS & Break-Even ROAS Calculator
Measure whether an ad campaign is profitable by comparing its return on ad spend to the break-even ROAS implied by your gross margin and platform fees, in a single profitability multiple.
Last updated: May 2026
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About this calculator
ROAS (return on ad spend) is simply adRevenue / adSpend: revenue generated per dollar spent. But ROAS alone does not say whether you made money, because only the gross margin on that revenue is real contribution, and platforms take fees. Your effective margin is grossMarginPercent - platformFeePercent. Break-even ROAS is the point where margin-adjusted revenue just covers spend, which equals 1 / (effective margin). This calculator returns the profitability multiple = ROAS x effective margin = (adRevenue / adSpend) x ((grossMarginPercent - platformFeePercent) / 100). A result above 1.0 means the campaign clears its break-even ROAS and is profitable; exactly 1.0 is break-even; below 1.0 you are losing money on margin even if ROAS looks high.
How to use
A campaign earns $10,000 from $2,500 of ad spend, giving a ROAS of 4.0. With a 60% gross margin and a 10% platform fee, your effective margin is 50%, so the break-even ROAS is 1 / 0.50 = 2.0. The profitability multiple is 4.0 x 0.50 = 2.0, meaning your ROAS is twice the break-even level and the campaign is solidly profitable. If margins were thin enough that break-even ROAS rose above 4.0, the multiple would drop below 1.0 and the campaign would lose money.
Frequently asked questions
What is a good ROAS for a profitable ad campaign?
There is no universal number because the threshold depends on your margins. The break-even ROAS equals one divided by your effective gross margin: a 50% margin needs a ROAS of 2.0 to break even, while a 25% margin needs 4.0. A ROAS that looks impressive can still lose money on thin margins. This calculator converts ROAS and margin into a single multiple where anything above 1.0 is profitable, so you do not have to memorize a target ROAS.
How do I calculate break-even ROAS from my profit margin?
Break-even ROAS is one divided by your effective margin expressed as a decimal, where effective margin is your gross margin minus any platform or payment processing fees. For a 60% gross margin and a 10% fee, the effective margin is 50%, so break-even ROAS is 1 / 0.50 = 2.0. Any campaign with a ROAS above that figure is contributing profit, which is exactly the comparison this calculator performs.
Why should ROAS account for gross margin and platform fees?
Revenue is not profit. Only the gross margin portion of ad-driven revenue actually contributes to covering ad spend, and advertising platforms and payment processors skim a percentage off the top. Ignoring these makes a campaign look more profitable than it is. By subtracting the platform fee from the gross margin and scaling ROAS by that effective margin, this calculator shows true profitability rather than a flattering top-line return.