ROAS calculator
Break-even ROAS is one divided by gross margin. At a 40% margin you need 2.5× just to stand still, so a 5× campaign is genuinely profitable. At a 15% margin, break-even is 6.67×, and that same 5× campaign is losing money on every sale despite sounding excellent. Any ROAS target quoted without a margin behind it is a number without a meaning.
ROAS is revenue divided by ad spend. Five thousand from a thousand is 5×. Whether that is profitable depends on margin: break-even ROAS is one divided by gross margin, so a 40% margin needs 2.5× and a 15% margin needs 6.67×.
How to calculate ROAS
ROAS and ACoS are the same relationship inverted: ACoS is ad spend over revenue, ROAS is revenue over ad spend, and which one you see depends on the platform rather than the maths. The deeper issue with both is attribution: a 5× ROAS reported by an ad platform counts every sale it can claim, including ones that would have happened anyway. Incrementality testing, where you turn a campaign off in some regions and compare, is the only honest way to know what the ads actually added.
Questions
Anything above your break-even, which is one divided by gross margin. There is no universal figure.
ACoS is one divided by ROAS, as a percentage. A 4× ROAS is a 25% ACoS.
No, only ad spend. That is exactly why break-even ROAS depends on margin.
Treat it as an upper bound. Platforms claim sales that would have happened anyway; incrementality testing measures what was actually added.
ROAS for varied order values, CPA when every conversion is worth about the same.