Break-even ROAS Calculator
Before you judge a campaign, know your finish line. Enter your gross margin to see the exact ROAS that breaks even — and the ROAS you need to actually hit your profit target.
Why this is the number that matters
A "good" ROAS isn't universal — it's set by your margins. Break-even ROAS is 1 ÷ gross margin: below it you lose money, above it you profit. To leave a specific profit margin, the math becomes 1 ÷ (gross margin − target profit margin). ACOS is just the same picture flipped — your break-even ACOS equals your gross margin.
Set this as the line your campaigns must clear, then let the winners scale and cut the rest.
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Frequently asked questions
What is break-even ROAS?
Break-even ROAS is the return on ad spend at which your ad-driven revenue exactly covers the cost of goods plus the ad spend — you make no profit and no loss. It equals 1 divided by your gross margin.
How do I calculate break-even ROAS?
Divide 1 by your gross margin expressed as a decimal. If your gross margin is 40% (0.40), your break-even ROAS is 1 ÷ 0.40 = 2.5, meaning you need $2.50 in revenue for every $1 of ad spend.
What is ACOS?
ACOS (advertising cost of sale) is ad spend divided by revenue — the inverse of ROAS, shown as a percentage. Your break-even ACOS equals your gross margin: spend any larger a share of revenue on ads and you lose money.