Formula
ROAS = revenue / ad spend
Why it matters
A ROAS of 4 means four dollars of revenue per dollar spent. It ignores product cost, so judge it against break-even ROAS, not in isolation.
Glossary // R / Accounting
What is Return on ad spend (ROAS)?
Definition
Return on ad spend is the revenue earned for each dollar spent on advertising, calculated as revenue divided by ad spend.