Break Even ROAS Calculator
Free break even ROAS calculator — find the minimum ROAS your ads need before they lose money after product costs. Enter margin and AOV (or lead value) for an instant floor you can use in Google Ads Target ROAS or Meta. No signup.
Quick answer
Use this free break even ROAS calculator to find your minimum profitable ROAS from margin and AOV. Break-even ROAS is the minimum return on ad spend where contribution margin equals ad spend — the floor below which campaigns lose money after product costs. Enter your inputs below for an instant Target ROAS floor.
Break-even ROAS = AOV ÷ [(AOV × gross margin %) − fixed cost per order]
Break-even ROAS
Break-even ROAS formula (quick)
Break-even ROAS = AOV ÷ [(AOV × gross margin %) − fixed cost per order]
With no fixed per-order costs, this simplifies to 1 ÷ margin%. A 50% margin means you need at least 2.0× ROAS to break even. For step-by-step examples and lead gen math, see how to calculate break-even ROAS.
Worked example
- AOV = $100
- Gross margin = 40%
- Fixed cost = $0
Contribution = $100 × 40% = $40
Break-even ROAS = $100 ÷ $40 = 2.5×
Platform ROAS at 2.0× still loses money. You need 2.5× just to cover contribution margin.
Dropshipping break-even ROAS
Dropshipping margins are often thin once product cost, shipping, and payment fees are included. A generic “3× ROAS” target can still lose money. Use this break even calculator for dropshipping by entering your real landed margin and per-order shipping.
- Product sell price (AOV) = $25
- Gross margin after product cost = 20%
- Shipping + payment fees = $4 fixed cost per order
Contribution = ($25 × 20%) − $4 = $5 − $4 = $1
Break-even ROAS = $25 ÷ $1 = 25×
At that margin, ads must return $25 of revenue for every $1 of ad spend just to break even — which is why low-margin dropshipping rarely works on paid traffic without raising price or cutting costs.
Quick break-even ROAS by margin
| Gross margin | Break-even ROAS |
|---|---|
| 25% | 4.00× |
| 30% | 3.33× |
| 40% | 2.50× |
| 50% | 2.00× |
| 60% | 1.67× |
| 70% | 1.43× |
Full table: break-even ROAS by margin table.
Frequently asked questions
What is a break even ROAS calculator?
A break even ROAS calculator turns your margin and AOV into the minimum ROAS ads need before they lose money after product costs. This page is the free tool — enter inputs and get an instant floor.
How do I use this break even ROAS calculator?
Enter average order value (or lead value), gross margin %, and optional fixed cost per order. The calculator returns contribution per conversion and break-even ROAS you can use as a Target ROAS floor.
How do I calculate break-even ROAS manually?
Divide value per conversion by contribution per order. Contribution = (AOV × gross margin %) − fixed cost. With no fixed costs, break-even ROAS = 1 ÷ margin. For a full walkthrough, see How to Calculate Break-even ROAS.
What is break-even ROAS at 50% margin?
At 50% gross margin with no fixed costs, break-even ROAS is 2.0×. Shipping and payment fees raise that number.
Is this calculator free?
Yes. Ad Breakeven’s break even ROAS calculator is free, with no signup. Results are shareable via URL.
Can I use this as a break even calculator for dropshipping?
Yes. Enter your product sell price as AOV, real landed gross margin, and shipping or payment fees as fixed cost per order. Thin dropshipping margins often need a much higher break-even ROAS than a generic 3× target.
Is a 3× ROAS always profitable?
No. Whether 3× is profitable depends on margin. At 40% margin with no fixed costs, break-even ROAS is 2.5×, so 3× is profit. At 20% margin, break-even is 5×, so 3× loses money on every sale. Use this calculator with your real margin instead of a generic 3× target.
Does break-even ROAS include shipping and fees?
Yes, if you enter them as fixed cost per order. Contribution is (AOV × gross margin %) minus that fixed cost. Leaving shipping and payment fees out understates the floor. With no fixed costs, the formula simplifies to 1 ÷ margin.
Should I set Google Ads tROAS at break-even?
No. Break-even ROAS is the floor, not the bid target. Set Target ROAS above break-even so there is room for profit, returns, and attribution gaps. Use the Target ROAS Calculator for that number: /target-roas-calculator