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POAS calculator

Work out your profit on ad spend, the version of ROAS that accounts for margin, so you scale what is actually profitable, not just what looks efficient.

$
%
$
POAS
2.8×
GROSS PROFIT
$28,000
ROAS (for contrast)
4.0×
Above break-even - each ad dollar returns more than a dollar of profit.

Runs in your browser. POAS uses gross profit (revenue × margin), so it falls below ROAS by exactly your cost of goods. Break-even on ad spend is a POAS of 1.0, before overhead.

How POAS is calculated

Profit on ad spend answers the question ROAS can't: after cost of goods, did these ads make money? It is gross profit per ad dollar, not revenue per ad dollar.

  1. Enter revenue from ads. The revenue attributable to the spend you are measuring.
  2. Enter your gross margin. Your margin after cost of goods sold, as a percentage.
  3. Divide gross profit by ad spend. POAS = (revenue × margin) ÷ ad spend. $40,000 at 70% margin on $10,000 spend is a POAS of 2.8.

POAS vs ROAS

ROAS is revenue per ad dollar; POAS is profit per ad dollar. Two campaigns with the same ROAS can have very different POAS if their margins differ, which is why optimizing to ROAS quietly scales low-margin products at a loss. For the full definitions, see POAS and ROAS in the glossary, and check whole-account efficiency with the MER calculator.

FAQ

POAS (profit on ad spend) is the gross profit generated per dollar of ad spend: gross profit divided by ad spend. Unlike ROAS, which uses revenue, POAS reflects what you actually keep after cost of goods.

POAS of 1.0 is break-even on ad spend (before overhead). Most brands target a POAS above 1.5-2.0 to cover fixed costs and profit, but the right number depends on your margin and payback tolerance.

ROAS is revenue per ad dollar; POAS is profit per ad dollar. Two campaigns with identical ROAS can have very different POAS if their margins differ, so POAS keeps spend pointed at what is actually profitable.

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