# ROAS (return on ad spend)

> ROAS is the revenue your ads brought in divided by what you spent on them.

Canonical: https://use-addy.site/glossary/roas
Last updated: 2026-10-26

Also called: return on ad spend

**Formula:** ROAS = revenue from ads ÷ ad spend

**Example:** $2,000 of spend that drove $7,000 in sales is a ROAS of 3.5x.

A ROAS of 3 (often written 3x or 300%) means every $1 of ads returned $3 in revenue. ROAS ignores product costs, so a 3x ROAS can still lose money on a low-margin product. The break-even ROAS is 1 ÷ your gross margin: at a 40% margin you need 2.5x just to break even on the first order.

## Related

- [ROAS calculator](https://use-addy.site/tools/roas-calculator)
- [ROAS vs CPA](https://use-addy.site/blog/roas-vs-cpa)
- [CPA (cost per acquisition)](https://use-addy.site/glossary/cpa)
- [AOV (average order value)](https://use-addy.site/glossary/aov)
- [MER (marketing efficiency ratio)](https://use-addy.site/glossary/mer)