Break-even ACOS and ROAS calculator
Work out the highest ACOS you can afford from your real fee stack, plus break-even ROAS, maximum cost per click and the ACOS ceiling for a target margin.
Break-even ROAS of 2.35×
Enter your ad spend and ad sales above to see where you sit against the ceiling.
| Step | Working | Result |
|---|---|---|
| Profit before adsEvery currency unit of this is available to buy a sale. | $17.00 | |
| Break-even ACOSSpend above this and the campaign is buying sales at a loss. | 17 ÷ 40 × 100 | 42.5 % |
| Break-even ROAS | 2.35 × | |
| Clicks per order | 100 ÷ 10% | 10 |
| Break-even cost per clickBid above this and you lose money on the campaign at this conversion rate. | 17 ÷ 10 | $1.70 |
| ACOS ceiling to keep a 15% margin | (17 − 6) ÷ 40 × 100 | 27.5 % |
Step 4 of 4 — I am selling on a marketplace
What is left after the platform takes its cut?
Your console reports ACOS. It cannot tell you what you can afford
Every advertising dashboard shows what your ACOS is. None of them knows your cost of goods, your referral rate, your fulfilment fee or your return rate, so none of them can tell you whether that ACOS is profitable. That depends entirely on the fee stack sitting underneath the sale, and it is the gap this fills.
Break-even ACOS is your profit before advertising divided by your selling price. A $40 product making $10 before ads has a break-even ACOS of 25% and a break-even ROAS of 4. Spend above that and each advertised sale loses money; spend below it and each one makes some.
Why a low ACOS is not automatically good
An ACOS far below break-even usually means underspending. You are leaving volume, search rank and organic momentum to competitors who are willing to buy them. Launch campaigns frequently run deliberately above break-even to buy sales velocity, because rank earned early is cheaper than rank bought later.
The number to watch over time is TACOS — total ad spend against total revenue, including organic sales. A falling TACOS alongside rising revenue means organic rank is carrying more of the load and the advertising is compounding rather than renting. A flat TACOS with rising spend means it is renting.
From ACOS to a bid you can actually enter
Break-even ACOS is a percentage, and a bid is an amount, so the conversion needs your conversion rate. Divide profit before advertising by the number of clicks it takes to produce one sale: at a 10% conversion rate that is ten clicks, so $10 of profit supports a $1 maximum bid. Bid above that and the campaign buys sales at a loss no matter how good the ACOS looks in aggregate.
Questions people ask about this
Answers written from the published rules, not from other people's summaries of them. Every figure quoted below is listed with its source at the foot of this page.
Every formula on this siteWhat is break-even ACOS?
The advertising cost of sale at which your profit becomes exactly zero. It equals your profit before advertising divided by your selling price. If a $40 product makes $10 before ads, break-even ACOS is 25% and break-even ROAS is 4.
Is a low ACOS always better?
No. An ACOS well below break-even usually means you are underspending and leaving volume, rank and organic momentum on the table. Launch campaigns often run deliberately above break-even to buy sales velocity. The number to watch over time is TACOS — total ad spend against total revenue — because a falling TACOS with rising revenue means organic rank is taking the load.
How do I find my maximum CPC?
Divide your profit before advertising by the number of clicks it takes to make one sale. At a 10% conversion rate that is ten clicks, so $10 of profit supports a $1 bid. Bid above that and the campaign buys sales at a loss.
Should organic sales be included when I judge a campaign?
For the campaign's own break-even, no — that calculation is about whether an advertised sale pays for itself. For the business decision, yes, which is what TACOS is for. Advertising frequently drives sales velocity that lifts organic rank, and the organic sales that follow are a return on the same spend even though the ad console does not attribute them. Judging a launch campaign on ACOS alone understates it; judging a mature campaign on TACOS alone flatters it.
Does break-even ACOS change with price?
Yes, and not proportionally, which is why it needs recomputing after any price change. Raising the price increases profit per unit but also increases the percentage fees charged on it, so profit before advertising rises more slowly than price does. The net effect is usually a higher break-even ACOS, but the size of the move depends on how much of your cost base is fixed per unit versus percentage-based. Recompute it rather than assuming the old ceiling still holds.
Further reading
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Where these numbers come from
This calculator uses arithmetic rather than published rates — every figure comes from the values you enter. See the methodology page for the formulas behind it.
Page updated . Spotted something out of date? Tell us — corrections are published with the date they were made.
More on the working: every formula on this site, the full source register, what the terms mean, and how we decide what to publish. What an estimate here can and cannot support is set out in the accuracy notes.