The three numbers that matter
ROAS = ad sales ÷ ad spend
ACoS = ad spend ÷ ad sales
break-even ACoS = your margin before ads
ROAS and ACoS describe the campaign. Break-even ACoS describes your product. Comparing them is the whole point: a 25% ACoS is great on an item with a 40% margin and a money-loser on an item with a 15% margin. Without your margin, the ad dashboard can't tell you whether you made money.
Worked example
$400 × 30% = $120 profit before ads, minus $100 in ads. Profitable, but only $20.
Now drop the margin to 20%. Same campaign, same 4x ROAS, but $400 × 20% = $80 before ads, and after $100 in ads you've lost $20. The ad dashboard looks identical in both cases.
Break-even ACoS by margin
| Margin before ads | Break-even ACoS | Break-even ROAS |
|---|---|---|
| 15% | 15% | 6.67x |
| 20% | 20% | 5.00x |
| 25% | 25% | 4.00x |
| 30% | 30% | 3.33x |
| 40% | 40% | 2.50x |
| 50% | 50% | 2.00x |
This is also why ads on low-margin items are so dangerous. At a 15% margin you need almost 7 dollars in sales for every ad dollar just to break even. I learned that one the expensive way, which I write about in ROAS and ACoS explained.
What the calculator can't see
- Returns. If 8% of ad sales come back, your real ad revenue is 8% lower. Subtract expected returns before entering sales.
- Organic lift. Ads can push an item up in organic search, which brings sales the ad report doesn't credit. TACoS helps you see that over a few months.
- Attribution windows. Amazon credits sales within 7 or 14 days of a click depending on ad type, so the last few days of a report always look worse than they'll end up.
Questions people ask
What's the difference between ROAS and ACoS?
They're the same ratio flipped. ROAS is ad revenue divided by ad spend (4x means $4 in sales per $1 spent). ACoS is ad spend divided by ad revenue (25%). Amazon reports ACoS, Walmart and Google usually report ROAS.
What is break-even ACoS?
It's your profit margin before ads. If you keep 30% of the sale price after the item, fees, and shipping, you can spend up to 30% of ad revenue on ads and still break even. Above that, every ad sale loses money.
What is TACoS?
Total advertising cost of sale: ad spend divided by all your sales, not just ad-attributed ones. It shows whether ads are building organic sales over time. A falling TACoS while sales grow is a good sign.
Is a high ROAS always good?
Not always. A very high ROAS can mean you're spending so little that you're missing sales. Many sellers aim slightly above break-even on new products to build sales history, then tighten up.
Rates last checked October 2026. Read how we check our numbers.