Enter your numbers to see the result and what it means.
How this calculator works
Enter your gross margin — revenue minus the cost of delivering the product or service, as a percentage. The calculator returns the ROAS at which advertising breaks even. Anything below it loses money on every sale.
The formula
Break-even ROAS = 100 ÷ gross margin percentage. A 50% margin needs 2.0x, a 25% margin needs 4.0x, and a 10% margin needs 10.0x before a single dollar of profit appears.
Worked example
At a 40% gross margin, every $100 of revenue leaves $40 after product costs. To cover $1 of advertising you need $2.50 of revenue, so break-even ROAS is 2.5x.
How to read your result
This is the floor, not the target. Hitting break-even exactly means the advertising paid for the goods and nothing else — no overheads, no salaries, no profit. Most businesses need meaningfully above it.
Questions
Should I use gross margin or net margin?
Gross margin — revenue minus the direct cost of delivering what you sold. Net margin already has advertising deducted, which would double-count it.
What if my margin varies by product?
Use a blended margin weighted by sales volume, or run the calculation per product line. A single average can hide a loss-making range.
Does this account for repeat purchases?
No. If customers buy repeatedly you can justify a lower first-purchase ROAS, but that is a lifetime-value decision made deliberately rather than by accident.
Proof this works
An ecommerce account where the maths actually held up at scale — 12x attributed ROAS across the period.
If you would rather we handled it
We run paid advertising with profitability as the measure, not impressions.
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