What Is ROAS? Formula, Benchmarks & How to Calculate (2026)
ROAS (return on ad spend) is the revenue your ads generate divided by what you spent on them — it measures how much revenue each $1 of ad spend brings back. The formula is: ROAS = ad revenue ÷ ad spend. A ROAS of 4.0 means every $1 spent returned $4 in revenue. It's the most common ad-efficiency metric, but a high ROAS doesn't automatically mean profit — that depends on your margin.
To find the ROAS you need to break even, use the break-even ROAS calculator; to work out costs and profit, use the profit calculator.
The formula
ROAS = ad revenue ÷ ad spend
It's the inverse of ACOS: ROAS = 1 ÷ ACOS. ROAS is a multiple of revenue returned; ACOS is spend as a share of revenue.
To judge profitability, compare ROAS against your break-even ROAS (BEROAS): BEROAS = 1 ÷ contribution margin.
Worked example
A campaign spends $500 and brings in $2,000 of revenue. ROAS = 2,000 ÷ 500 = 4.0. That looks good, but if your contribution margin is only 20%, break-even ROAS = 1 ÷ 0.20 = 5.0 — a 4.0 falls short of 5.0, so the campaign is actually losing money. If instead your margin is 50%, break-even ROAS is just 2.0 and a 4.0 is very profitable.
A "good ROAS" depends on your margin
| Contribution margin | Break-even ROAS | ROAS to profit |
|---|---|---|
| 50% | 2.0 | Above 2.0 |
| 40% | 2.5 | Above 2.5 |
| 30% | 3.3 | Above 3.3 |
| 20% | 5.0 | Above 5.0 |
There is no one-size-fits-all "good ROAS": the same 3.0 is profitable on a high-margin product and a loss on a thin one. Always benchmark against your own break-even ROAS.
Frequently asked questions
What is a good ROAS? There's no universal answer — it depends on your margin: any ROAS above your break-even ROAS is profitable. A 2.5 is fine at a 50% margin, while a 4.0 can still lose money at a 20% margin.
What's the difference between ROAS and ACOS? Two views of the same thing. ROAS is a multiple (revenue ÷ spend); ACOS is a percentage (spend ÷ revenue). ROAS = 1 ÷ ACOS, so a ROAS of 5.0 equals a 20% ACOS.
Is ROAS the same as ROI? No. ROAS uses revenue and ignores costs; ROI (return on investment) uses profit, after deducting COGS, fees and so on. With a high ROAS but a thin margin, ROI can be negative. ROAS measures ad efficiency; ROI measures actual profitability.
Why is my ROAS high but I'm still not making money? Because ROAS only looks at revenue, not costs. If your margin is thin, your break-even ROAS (BEROAS) is high, and falling short of it means a loss. Always judge ROAS against your own margin.
To place ROAS inside a full per-product profit model, see the TikTok Shop fees and profit-margin breakdown.
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