Cloud Ten / POAS calculator
What does your reported ROAS actually leave you?
Work out your true profit on ad spend. Enter revenue, margin, fees and returns to see what your reported ROAS actually leaves you.
Contribution profit after ad spend: £0 per month. This is the number your P&L sees.
What is POAS?
POAS is profit on ad spend — the gross profit your advertising produced, divided by what you spent to produce it. ROAS divides revenue by spend. POAS divides profit by spend. On a 30% margin product those two numbers are wildly different, and only one of them can pay salaries.
Why ROAS flatters you
A 6x ROAS on a 25% margin product is a 1.5x POAS before you have paid for shipping, payment processing or returns. Scaling on ROAS pushes budget toward whichever products convert cheapest, which are usually the least profitable ones.
What good looks like
A POAS above 1.0 means paid media is contributing gross profit. Whether that is enough depends on your overheads — most brands need 1.5x to 2.5x for paid to genuinely fund growth rather than just cover itself.
Frequently asked
What is a good POAS?
Anything above 1.0 means paid media produced more gross profit than it cost. Most brands need 1.5x to 2.5x for advertising to genuinely fund growth once overheads are covered.
What is the difference between POAS and ROAS?
ROAS divides revenue by ad spend. POAS divides gross profit by ad spend. On a 30% margin product a 5x ROAS is roughly a 1.5x POAS before shipping, fees and returns.
How do I calculate POAS?
Take revenue, subtract returns, apply your gross margin, subtract shipping, fulfilment and payment fees, then divide the result by ad spend.
Does POAS account for incrementality?
Not by itself. POAS still assumes the platform caused every sale it claims. A holdout or geo test is the only way to establish how much of that revenue would have happened anyway.