Methodology & Formula

ROAS (Return on Ad Spend) is calculated by dividing the total revenue generated from an advertisement by the total cost of that advertisement.

Formula: ROAS = Revenue / Cost

A ROAS of 1.0 (100%) means you are breaking even on your ad spend. Most businesses aim for a ROAS of 3.0 to 4.0 to cover other operating costs and generate a net profit.