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ROAS and ROI Calculator: Return on Ad Spend and Break-Even ROAS

Enter spend and return to see ROI, annualised ROI and ROAS, and work out the break-even ROAS for your margin before you scale ad spend.

Calculator

ROI

$
$
Time is in
ROI60%Gain: $600.00
26.49%Annualised ROI
1.6×Money multiple

At this yearly return your money would double in about 2.9 years.

ROAS (ads)

$
$
%
ROAS4.2×Break-even ROAS at 30% margin: 3.33×
$52.00Profit after ad spend
ACoS (ad spend as % of ad sales)
23.8%
POAS (profit per 1 of ad spend)
1.26×
Ad sales needed to break even
$667

Amounts are in USD (United States selected). Change country or currency in the header. Exchange rates are approximate, from a static table updated 2026-10-25 — not live and not for transactions.

Estimates for planning only. Not tax or financial advice. Last verified: 2026-10-25

ROAS & ROI calculator: how it works

Return on investment compares what you gained with what you put in. If you invest 100 and end up with 150, the gain is 50 and ROI is 50%. Because a 50% return over one year and over ten years are very different, the calculator also gives an annualised rate: the constant yearly growth that would turn the amount invested into the amount returned.

ROAS, return on ad spend, is a related measure for advertising: ad revenue divided by ad spend. It tells you sales per unit of spend, not profit. To know whether a ROAS pays off you need your gross margin. The break-even ROAS is 100 ÷ gross margin %, and any ROAS below that loses money after the cost of the goods.

Formula and assumptions

Formula

  • ROI % = (returned − invested) ÷ invested × 100
  • Annualised % = ((returned ÷ invested)^(1/years) − 1) × 100
  • ROAS = ad revenue ÷ ad spend

Assumptions

  • ROI uses total amount invested and total amount returned over the period.
  • Annualised ROI assumes compounding over the years entered.
  • Break-even ROAS = 100 ÷ gross margin %. It ignores other overheads.

Worked example

Investment and an ad campaign

  1. Invest 1,00,000 and get back 1,50,000 after 3 years: gain 50,000, ROI = 50%.
  2. Annualised = (1.5)^(1/3) − 1 = 14.47% per year.
  3. Ad campaign: spend 20,000, ad revenue 80,000 → ROAS = 4.0×.
  4. With a 25% gross margin, break-even ROAS = 100 ÷ 25 = 4.0×, so profit after ads = 80,000 × 25% − 20,000 = 0.

Result: ROI 50% (14.47% a year); the campaign's 4× ROAS is exactly break-even at a 25% margin.

Limitations

  • ROI treats the amount invested and returned as two lump sums. It does not handle regular contributions or withdrawals; use IRR or XIRR for that.
  • It ignores taxes, fees, inflation and risk, which can turn a positive nominal return into a loss in real terms.
  • ROAS uses revenue, not profit, and says nothing about returns, discounts or customer lifetime value.
  • Attribution is imperfect: ad platforms may credit sales that would have happened anyway.

Frequently asked questions

What is the difference between ROI and ROAS?

ROI measures profit relative to the amount invested. ROAS measures revenue relative to advertising spend. ROAS ignores product cost; ROI normally includes it.

What is a good ROI?

It depends on risk and time. Compare the annualised figure with realistic alternatives such as a bank deposit or index fund, rather than judging the raw percentage.

Why does the calculator show annualised ROI?

A return earned over five years is smaller per year than the headline number suggests. Annualising lets you compare investments of different lengths.

What is break-even ROAS?

It is the ROAS at which the gross profit from ad-driven sales exactly pays for the ads: 100 ÷ gross margin %. At 25% margin it is 4×; at 50% it is 2×.

Can ROI be negative?

Yes. If you get back less than you invested, ROI is negative. The annualised figure is also negative then.

How do I calculate ROAS?

Divide the revenue attributed to your ads by the amount spent on them. If $1,000 of ad spend brings $5,000 of revenue, ROAS is 5, often written as 5x or 500%. ROAS ignores product cost, so compare it with the break-even ROAS for your margin before deciding whether the ads are profitable.

What is a good ROAS?

A good ROAS is one comfortably above your break-even ROAS, which is 100 divided by your gross margin percentage. At a 40% margin the break-even is 2.5x, and at 25% it is 4x. Any fixed 'good' number ignores your margin, shipping and returns, so work it out from your own figures.

How do I calculate ROAS in Meta or Google Ads?

Both platforms report a purchase or conversion value divided by spend. Make sure conversion value tracking is set up, and remember that platform-reported ROAS depends on the attribution window and can differ from the revenue in your own sales records. Enter your real spend and revenue in this calculator for a cross-check.

Sources

Calculator data last verified: 2026-10-25. Estimates for planning only; not tax or financial advice.

What next?

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